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The Future of Music Book and Podcast

The Future of Music – by Dave Kusek and Gerd Leonhard

The Future of Music book is available in various forms.

future of music

 

You can buy the book on Amazon.

 

You can purchase the audiobook from Audible.

 

You can listen to the book on iTunes as a podcast for free. Go to the iTunes store and search “Future of Music” podcasts and subscribe.

Here are a few of the reviews.

Publishers Weekly
Two innovators in music technology take a fascinating look at the impact of the digital revolution on the music business and predict “a future in which music will be like water: ubiquitous and free-flowing.” Kusek and Leonhard foresee the disappearance of CDs and record stores as we know them in the next decade; consumers will have access to more products than ever, though, through a vast range of digital radio channels, person-to-person Internet file sharing and a host of subscription services. The authors are especially good at describing how the way current record companies operate – as both owners and distributors of music, with artists making less than executives – will also drastically change: individual CD sales, for example, will be replaced by “a very potent ‘liquid’ pricing system that incorporates subscriptions, bundles of various media types, multi-access deals, and added-value services.” While the authors often shift from analysts into cheerleaders for the über-wired future they predict – “Let’s replace inefficient content-protection schemes with effective means of sharing-control and superdistribution!” – their clearly written and groundbreaking book is the first major statement of what may be “the new digital reality” of the music business in the future.

5.0 out of 5 stars THE FUTURE OF MUSIC IS NOW
Gian Fiero (Hollywood, California)
This book is so brilliant that it makes the vast majority of music industry books that are being published seem irrelevant. It discusses in detail, the reasons why the future of the music industry is headed into the digital/mobile entertainment era. It also provides statistical information that professionals, marketers, entrepreneurs, and educators can use constructively. Both Dave and Gerd (the books co-author), have their fingers firmly planted on current music industry activities and trends. They also possess and display a clairvoyant eye toward the future that offers beneficial insight and foresight to those who may not be aware of what this whole digital (i.e. independent) revolution is about, and most importantly, what it will entail to prosper in it. The book is easy to read, easy to understand and simply brilliant. If you buy just one industry book this year, this should be THE one. Buy it now!

5.0 out of 5 stars Indispensible
Stephen Hill “Producer, Hearts of Space” (San Rafael, CA USA)
A stunningly candid source of concentrated, up to date insight about the music business and its turbulent transition into the digital era. This book tells it straight and will make the dinosaurs of the music industry very unhappy.

Like Martin Luther’s ’95 Theses’ nailed to the door of Wittenberg Cathedral, Kusek and Leonard drive nail after nail into the sclerotic heart of the old-fashioned music business. Their rational vision of the future of music rests on the idea of unshackling music from the hardcopy product business in a yet-to-be-realized era of open content licensing, facilitating sharing and communication among users, and growing the business to its full potential.

It provides as clear a vision of the future of the music industry as you will find, from two writers with a rare combination: a solid grounding in the traditional practices of the music business, an up-to-the-minute knowledge of the new technologies that are changing it, and the ability to think through the consequences.

I’ve dreamed about a book like this, but thought it would be impossible in today’s hyperdynamic environment where every week seems to bring a breakthrough technology, device, or service. But by digging out the underlying trends and principles Kusek and Leonard get under the news and illuminate it. Along the way they provide a brilliantly concise history of the evolution of digital media.

I can’t think of any book more important for artists to get the full re-orientation they need to survive and prosper in the digital era. It’s no less critical for members of the music and broadcasting industries who need to consolidate their thinking into a coherent roadmap for the future. In a word: indispensible.

Other things to do from here:

We have a wide variety of blog posts and articles on the music business and the future of music. Please click on any of these links to read more.

How to Promote Your Music

How to License Your Music

How to get your Music on Spotify Playlists

How to book bigger and better Gigs.

Instagram for Musicians

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Visions of the Future

Here are two visions for the future, one from Corning and one from me.  The Corning video is from earlier this year and shows their vision for a visually connected communications environment.  This is not unlike the future that Gerd Leonhard and I described in the Future of Music in 2005.

Can you imagine organizing your daily schedule with a few touches on your bathroom mirror? Chatting with far-away relatives through interactive video on your kitchen counter? Reading a classic novel on a whisper-thin piece of flexible glass?

The video depicts a world in which interactive glass surfaces help you stay connected through seamless delivery of real-time information – whether you’re working, shopping, eating, or relaxing.

Does the world showcased in “A Day Made of Glass” seem like something out of a fantasy movie?  Just a decade ago, pay phones, VCRs, and film cameras were also commonplace. Today, we’re accustomed to movies streaming on demand to a 60-inch television hanging on the wall and to video calls on notebook computers, essentially for free.

What might this mean for music? Well, today we have Spotify and Rdio and Mog all providing on demand music for free or nearly for free. Listen to this vision for the future and see how far we have come in the past 5 or 6 years from our book on the Future of Music.

https://player.soundcloud.com/player.swf?url=http%3A%2F%2Fapi.soundcloud.com%2Ftracks%2F29101326&show_comments=true&auto_play=false&color=ff7700

Check out the Future of Music book here.

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Change or Die

A friend just sent over this post on how the newly elected Chairman of the Entertainment Retailers Association,  said that illegal P2P filesharing is the greatest challenge facing entertainment retailers and urged members to lobby Government for a crackdown on a problem he said “is bleeding our industry dry”.

Speaking at the association’s annual general meeting, Quirk said, “Too often the debate over illegal filesharing is portrayed as an ideological battle, but for us this is a commercial matter. Illegal filesharing is damaging our businesses, both physical and digital, on a daily basis, and the Government needs to tackle it swiftly and decisively in order to protect jobs, businesses and investment.

“First the filesharers targeted the music business and the Government did nothing. Now the filesharers have come again for TV and movies. Unless action is taken the filesharers will come for computer games, books, in fact anything which can be digitised and what will be at stake will be not just the entertainment industry but huge swathes of the UK economy. We need action now.”

Read more of this insanity here at Mi2N

Well now…

I was visiting with my Dad last weekend and thought of an interesting parallel between digital music and encyclopedias.

When I was a kid, my father had a summer job going door to door selling Comptons Encyclopedias.  He would carry a couple of these huge books under his arms and try and get the husband or wife to buy the complete Comptons collection for the kids.  This was big business and my dad made a healthy living during the summer.

Well, over the years the encyclopedia book business began to dry up.  To start it all off, Comptons put their entire encyclopedia library on a CD-ROM and sold it via a new company they formed, called Comptons New Media.  They put the CD-ROM in a chipboard box and sold it at Comp-USA,  Software Etc and other retailers for $200-$300.  It became big business for a while in the early 1990’s, and Comptons New Media flourished and was eventually purchased by the Tribune Co for a lot of dough.

It didn’t take long before some hackers cracked the CD-ROM and then pirated versions of the whole enchilada began making their way into stores and online outlets.  By now, of course, the multi-volume Comptons Encyclopedia Book business had gone the way of the dinosaur, and countless pavement pounding salespeople were no longer going door to door selling encyclopedias – and the entire book business basically went away.  Gone in a matter of a few years.  I think they still sell some to schools somewhere.

The same thing soon happened to Comptons New Media as digital competitors emerged, from Microsoft “Encarta” and others, and soon price competition and the internet gave way to this information moving online for free.

Now we have something called “Wikipedia”.

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The information contained in the encyclopedias is still being researched and published and edited by now, tens of thousands of people who put it online in a living, dynamic format.  By and large, no one is getting directly paid to do this work, yet no-one can dispute the fact that society in general is benefiting from Wikipedia and other community-based information resources.  You might even notice that there is a lot more information being produced and updated and cross referenced than ever before.  This is all without the infrastructure of the past (ie Comptons) being in-place anymore, and almost no money changing hands.

Just like Comptons, the record industry digitized all of its assets and put the entire thing out there for the public to enjoy.  And just like Comptons the record industry in now suffering from price erosion, shifting formats and piracy.  They can try and hang in there and bash the problem away with legislation, or they could seriously consider other methods of delivery and renumeration, or they could sell off their remaining assets and shut down.  No matter what, the game they have played is over, caput.  Time to face the music and change.

There are no guarantees in business that things will remain the same.  Indeed, the only real constant is change and businesses that try and hold onto the past will be crushed by their own weight and failure to adapt, or in some cases, to just shut down.  Nothing is forever except change.  People should stop complaining about it and start working on creating a future that benefits us all.

Do I know exactly what that future is going to be?  Of course not.  I wish I could say with certainty but I can’t – for now.  But I think it will look a lot more like wikipedia than comptons encyclopedia sets.

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Gerd Leonhard Interview at Rollo & Grady

Gerd Leonhard

My co-author and friend Gerd Leonhard was recently interviewed by Carter Smith of Rollo & Grady. Here is the interview:

R&G: How did you become interested in writing about the future of music?

Gerd: I was involved in various online ventures during the Internet years, in the late 90s. I was trying to reinvent the music industry, so from 1998 through 2001 I ran a company called licensemusic.com. It was a real dotcom venture. Because of the work I had done, I saw what was going on. While I was recuperating from the dotcom craziness, I figured that since I had looked at it so deeply that I might as well write about it. I wrote “The Future of Music” from 2003 to 2004, and it was published in 2005. Ever since then I’ve written and blogged about the future of music, the media business and the content business in general.

R&G: In the book, you focus on the concept of music being like water. Can you describe that?

Gerd: I had a co-writer, Dave Kusek, who you might know. He teaches at Berklee College in Boston. The concept of Music Like Water wasn’t entirely ours. David Bowie once said in an interview with The New York Times that music would become like water, flowing freely. That stuck with us and we built this whole theme around it, saying that digital music needs to be as available as water. In other words, there has to be a licensed pipeline, just like licensed connections for water or electricity. Everybody pays for electricity and water, but nobody feels it’s a big effort to do so. Of course, people are up-sold with Evian, Pellegrino, or filling the swimming pool. It is very much the same logic. You have a license to use. You’re all in. Then you do an up-sell towards other variations. The principle fits pretty well with the idea of content distribution on digital networks. It’s a blanket deal – a big deal rather than a unit sale.

R&G: Is that similar to the labels backing Choruss? [Note: Choruss is a proposed plan that would build a small music-royalty fee into university tuition payments, allowing students to legally access and share music.]

Gerd: Yes, totally. A friend of mine, Jim Griffin, is doing that. Jim and I have talked about this for the last ten years, pretty much since Napster came to light. It’s a very similar idea, even though they’re thinking of this as more of a “covenant not to sue.” I don’t think that is taking it far enough. One has to be realistic. I think that the major labels are reluctant to give up control of the ecosystem in a flat out strike, so they will probably take a bit longer to get used to this.

R&G: If I understand this correctly, it’s a university tuition tax?

Gerd: It’s not so much a tax as a way for universities to say, “Whatever people do here, we can legalize it.” It’s fighting against the criminalization of sharing, which is great. And for the students it’s not a tangible expense. It’s wrapped into their tuition. It’s like 911 calling on your phone bill; nobody is going to complain about it. Then, I think a completely new ecosystem could pop up that would essentially be part of the way to access and up-sell to people. I would be against any such tax, levy, or any of those things, but if it can be made to feel like it’s free, which is what it is, I think that is an ideal solution that gets the ball rolling.

R&G: Once a digital network customer pays a fee, how are funds distributed to the artists?

Gerd: It’s very much like traditional radio. Every action on a digital network is monitored. Whether it should be is a different question, and, of course, there are privacy issues. But whatever action people are doing on the network, it’s captured in some anonymous way and then the revenues are paid pro rata. When you click on a song and share or download it, whatever network you’re on can say, “Okay, this was downloaded. This was streamed.” Artists are paid out strictly by popularity. So if your band is busy doing lots of gigs, you’re very popular and you get 100,000 people following you on Twitter, they will click on the song, download it, and you get more money. It’s just like radio.

R&G: Can the labels regain the trust of “people formerly known as consumers?”

Gerd: They may not be able to, and this is the Number One problem. I think it’s a very tough road. The only chance they have – and that goes for everyone, not just the majors, but also the indies – is to drastically open up, put their cards on the table and start doing business like everybody else. This means being transparent, sharing, putting deals on the table and making them public. They need to create real value rather than pretend to do so.

R&G: You’ve previously mentioned that music blogs are the new record labels.

Gerd: Yes. Music blogs have enormous power because people trust the blogs not to pitch them stuff that they’ve been paid to pitch. If they can keep it up, they will be the next BBC. When you look at mechanisms like Twitter or Facebook or FriendFeed, these people become the default recommenders for us. They are the ones who say, “You should pay attention to this band, to this artist.” That’s what radio used to do.

R&G: Serving as filters.

Gerd: Yeah. You have to keep in mind that the biggest problem we are having is not that music isn’t available, because even though it’s not legal it is available. The biggest problem is that once the legal issues are solved, everything will become available. Our problem will be that we have to pick, and nobody has time to pick through 62 million songs. That’s the total universe of currently published music, and it’s going to increase. We don’t really need to solve the distribution problem. We have to solve the attention problem. That’s what Amazon does for books.

R&G: You’ve talked about how the record industry should adopt Twitter. Can you elaborate?

Gerd: Twitter is a mechanism of micro communication, like RSS feeds. Therefore, it becomes something that is completely owned by the people who are doing it, rather than by the people who are making or receiving it. It’s a completely viable mechanism that is cost-neutral, at least to us. It becomes a very powerful mechanism for peer response and viral connections. That is the principle of what music is all about. It’s word of mouth, connecting, forwarding and sharing. A musical version of Twitter would be a goldmine. It already exists to some degree in blip.fm, but the music industry should use that mechanism to broadcast directly to fans. They’re starting to do that, but the problem is that many music companies perceive their primary mission as gatekeeper for the artists rather than getting the music out. That is a big problem today, when you’re in an economy where everybody wants a snack before buying a sandwich.

R&G: What other technologies do you think are necessary for the do-it-yourself artists and managers of the new music world?

Gerd: Widgets and syndication have made YouTube the world’s leader in video. 60% of videos are not played on YouTube.com but on blogs and other people’s sites. Music has completely overlooked that very powerful tool. That is this whole idea of syndication – getting people to transmit music to each other and then reaping the attention on the other end.

R&G: Many of the kids who grew up with Napster are now in college. They’ve never owned a physical CD and only know how to click and download music. They think music is supposed to be free.

Gerd: Yeah, and it can be free in the sense that it’s not as painful as paying per action. The question is not so much about the payment or the fact that people may not be willing to pay right away. It’s about controlling the marketplace. Who gets to listen to what, where, when and how much money do I get? We have to get back on the same page we were on a hundred years ago. We’re all on the same boat. Everyone wants an audience. Until we have that, we have nothing.

R&G: When do you foresee the end of the CD?

Gerd: I think we have another 18 months maximum for CDs to become a Step Two rather than a Step One. They have a 25% decline for 2008 pretty much around the world. How much steeper can they drop? In 18 months, the CD isn’t going to be the cherished moneymaker anymore. And this year people in the music business are going to be forced to say, “Okay, what is the next model? Do we have to loosen up to actually participate in this, or are we standing in our own way?”

R&G: Are you saying they need to recognize any revenue stream they can generate from their content? Sell CDs, subscriptions, etc.?

Gerd: The flat rate is the next CD. Its simple mathematics. If you charge or indirectly earn one dollar from each user of a network, that dollar can be ad-supported. It can be supported by bundling, so the user won’t feel it, so to speak. If you look at the total number of people who are active on digital networks, which is somewhere in the neighborhood of 3 ½ billion people, they’re not all going to pay a dollar because they’re in different countries. But the money that comes in from such a flat rate is humongous.

R&G: You are currently working on a new book, “End of Control.” When is it coming out?

Gerd: I’m working on it right now, and it’s kind of a painful process because it’s always changing. The first couple of chapters have already been published at endofcontrol.com, and people can download those. It’s a free book, so I’m working on various ways to make that more powerful. The control issue is key. It used to mean that if you had more control you would make more money, especially in the music business. You control distribution, radio stations, marketing, everything. Now all that is completely falling apart. Artists are going direct. Radio becomes useless to some degree. It’s all on the web now. People are doing their own thing. Control is a thing of the past. The question is, “What is the next business model?” That’s what I’m working on.

R&G: Who are the current music business visionaries?

Gerd: This is one of the most unfortunate things. There aren’t very many. I always say we need an Obama of the music business, or at least a Steve Jobs, even though Steve is kind of egomaniacal, but brilliant. I see a couple of people, like Terry McBride from Network Records in Canada. I firmly believe, however, that the biggest innovation will come from people who are not in the music business.

R&G: Is this the year we will see considerable change within the music industry?

Gerd: I thought it was going to be 2008, so I’m quite disappointed. I think we’ll see new things emerge in 2009 that will be completely disruptive, like the iPhone and mobile applications of music, new kinds of broadcasting, people sharing stuff through mobile networks and high-speed, broadband, wireless Internet. I think 2009 will be a key year because the current economic crisis will make it worse. People will stop buying content the old-fashioned way.

Read more great interviews here at Rollo & Grady

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Dave Kusek Interview at Rollo & Grady

Future of Music Book

I was recently interviewed by Carter Smith of Rollo & Grady on The Future of Music.

R&G: What was the reason behind writing “The Future of Music?”

Dave: Gerd [Leonhard; co-author] and I became friends at Berklee. He did a few projects with the music business department, which is how we got to know each other. We started talking and found that we had a lot of common ideas about what was happening in the music business. I ran Berklee Press, so I had a way to publish the book. We just started putting ideas down on paper. There wasn’t as much blog action then as there is today. It was probably 2002 or 2003 when we really started to write the book, so we figured, ‘Okay, we’ll publish it in book form.’ Our motivation was, ‘How can we help people understand what we think is going to happen?’ Both Gerd and I had done lots of panels and music shows – South by Southwest, all the digital music ones, Billboard and many gigs like that. We thought, ‘How can we pick some of these ideas and package them in a form that would be digestible and widely available to people at a reasonable price point?’ That was the genesis of it all. Honestly, it all happened so quickly that I kind of wish we could do it all over again. It was fun. It was a very condensed period of time. There were a lot of things that obviously were changing and happening, and there were a lot of things that weren’t so obvious. For example, I don’t think there was an iPod when we first wrote the book. That happened during the publishing and editing process. There was no iTunes music store, no MP3 blogs to speak of and no Amazon.com selling downloads. eMusic might have been there. It was all so early. Everything was happening so rapidly. We just tried to gather up as much as we could that was obvious and make some stabs as to what might happen.

R&G: Can you discuss the process of writing the book?

Dave: I learned a lot from Gerd during the process. I was more on the ground with the musicians. My whole career has been helping musicians and artists create their art, take their art to market and most recently teaching them about it. Gerd was more in the consulting end of things, talking to the likes of Nokia, Apple and Sony. I learned a lot about what was going on in the corporate world that I hadn’t been exposed to. I think we pushed each other because I would often argue that, ‘Man, we’ve got to talk to the artists and writers and managers, not to your consulting clients, because most of these people aren’t going to understand what the hell you’re talking about.’

R&G: “Music Like Water” the David Bowie quote meaning music becoming a utility. Do you still believe in that?

Dave: I think it’s inevitable. Music has always been free. It started off as a live performance. You’d go to a party, to a friend’s house, to a show, to the theatre or an event and music would be there. You’d be dancing and laughing and happy and singing. There was no idea of a business other than maybe the performers wanting to get paid. Throughout the technological phase of the last seventy or eighty years, there was always a free form of music, such as radio. The single most influential technological phenomenon in music was radio. It brought music to everybody, and it was free. Now we have gone through this pre-packaged, packaged phase of music, with vinyl, cassettes and CDs. That was a way for labels to control distribution and squeeze profits out of people wanting copies of the stuff they heard on radio. But once that leapt into the Internet, music became free again.

R&G: By free, do you mean file-sharing and uploading CDs onto your computer hard drives?

Dave: Both. People have been trading files for years. It started out on Usenet, which predated Napster. You remember Apple’s “Rip, Mix, Burn” campaign? It was really all about enabling the digitalization of music and unlocking it from the plastic that it was bound to. I don’t see it as a big deal that music is free again and in a higher quality format that is randomly accessible to the file-sharing networks or the services that we have now, some of which are “legitimate” and some aren’t. It’s not a very big deal to me. It just seems normal. The utility idea already exists on your TV. I have Comcast service here on the East Coast. We have Music Choice, which is essentially digital radio on your TV. There are 30 or 50 channels of music that are programmed and streamed to my house constantly that I pay for on my cable bill every month. I’ve been doing that for fifteen years. I have no choice about it. I just do it. It comes with HBO and the basic cable service. So there already is a music utility that millions of consumers in the U.S. have paid for many years. Why can’t that service just get a little bit better? If you add a random access mechanism where I can select what I listen to at a finer level than just picking the channel that Music Choice gives me, the service becomes better. I think it’s inevitable. I don’t understand what all the teeth gnashing is about. That’s a personal opinion.

R&G: What role will labels play in the future business models?

Dave: The major labels are going to be able to sign new artists, so they will have influence. But I think the indie labels and the no-labels that artists are forming – their personal labels – are going to be just as influential. If you get a super-hot band that decides they’re going to help pioneer a new format or a new distribution vehicle, and people love the band, they’re going to pick that up. They’re going to inherit that into their life. If enough new bands do that and connect with their fans, that will matter way more than what the four big record labels do. Eventually, they’re going to come around and say, ‘Oh man, we’ve got to get on this bandwagon,’ as opposed to doing it deliberately. You can see in the last four or five years, and particularly in the last two years, that labels are willing to abandon DRM, experiment and take a little bit more of a risk in how their music is put out there, which they absolutely, categorically refused to do four or five years ago. The rest of the music world is pulling them along. The fans and the new music are pulling the bigger labels into the future, as opposed to the big labels setting the pace. I think those days are over.

R&G: The majority of people I talk to feel that the next killer app is a filter that will enable users to find music they enjoy.

Dave: I think that’s certainly a critical element of whatever system of music delivery we evolve into. Findability, discovery are going to be critical features. I don’t know that there’s going to be a technological solution to that problem. Again, various forms of word-of-mouth have driven the popularity of all music through the years. So, to the extent that we can supercharge that word-of-mouth that’s happening in blogs like yours and services like Last.fm and Pandora that are kind of aggregating the opinions of others, uncovering and making those available, I think that’s going to be very important. But again, I don’t see how that’s any different than my telling friends in 1963 that I heard this cool band on the Ed Sullivan Show. It’s the same thing.

R&G: What do you think of blog aggregators such as The Hype Machine and Elbows?

Dave: I frequent The Hype Machine. Elbows, I’ve looked at a couple times. I think it’s a great thing. The more somebody can make it easier for people to find music they’re going to like, the more value that entity will gather. I don’t know that a computer-based search is going to be the ultimate winner. I tend to doubt it. I think it’s going to be more in the mobile space. It still blows my mind that people sit in front of their computers and listen to music on these absolutely shitty little speakers. They’re listening to crappy files in an uncomfortable chair. When I grew up, having a killer stereo was all that mattered, other than a car and a girlfriend. The stereo/audio business has completely gone away and been replaced by shitty ear-buds from Apple and MP3 files. It blows my mind that people tolerate that. I think it’s impacted the experience of listening to music, how you listen to it, how you enjoy it. So I’m not sure that a computer-based model is going to get enough traction to supplant other ways of acquiring, listening to and finding out about music. I think it needs to be easier, better sounding, portable and more integrated into your life. It needs to get outside of your bedroom or den.

R&G: I read on your blog that Douglas Merrill, President of EMI Digital, said he agreed with data that suggested file-sharing is good for the music industry. I found that interesting, but he also came from Google and didn’t have any experience in the music business. Do you see a trend in technology guys coming to the labels and figuring out how they can make this work; a technology guy versus the old-school music guy?

Dave: Not necessarily. I think the great labels of the past were run by music people who understood what the artists were all about and how to create great product, great songs and how to put great people together. I don’t think we can wave a wand and put a bunch of techies in the driver’s seat, and everything will suddenly be good. You need educated people that understand the technology, the music, the creative process, the marketing and the relationships with fans. As those skill sets get implanted in the people running the companies that matter – not just labels, but publishers, touring companies, marketing companies and distribution companies – then things will get better. I’m pretty confident of that, but I don’t see technology solving the music industry’s problem.

Read more great interviews here at Rollo & Grady

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Spin Magazine Book Club Pick – The Future of Music

From SPIN.COM

MC Lars, a self-proclaimed “post-punk laptop rapper,” may be best-known for his fast-talking rhymes about Hot Topic stores and hipster girls, but the Bay Area musician is notably literary, and therefore a fitting participant in our ongoing series of musicians talking about their favorite books. Not only has MC Lars penned songs about Moby Dick, Edgar Allen Poe’s “The Raven,” and Hamlet, he’s also published a book of his own poetry called Bukowski In Love.

For his SPIN.com Book Club pick, Lars veers away from iconic works of literature, instead choosing a practical tome for anyone making music these days: The Future of Music: Manifesto for the Digital Music Revolution, authored by two veterans of pop music who outline the music industry’s digital future.

SPIN: Why did you pick this book?
MC Lars: I studied English literature in college, but in a few years I want to do a PhD in media studies, so I’m always reading books about music technology and the digital music revolution and the evolution of content and new media economics. I read this book because one of the authors, Dave Kusek, is a professor at Berklee College of Music and he’s a really smart guy [who actually was one of the co-developers of MIDI technology, a revolutionary development in electronic music]. It’s really influenced my philosophies on technology and media and it’s also really influenced my business model as a guy with a label.

How many times have you read it?
Three times. It’s a good one.

Do you reread the whole thing or do you just have sections you go back to?
What happened was I read it casually and then I read closely and then I read it again because I wrote a song that was inspired by it. I took some of his philosophies and made it into lyrics. It’s called “Download This Song.” The author heard my song, and on the website for the book they did a little piece about how the song reinforced those philosophies. It was really cool to have this author I really love like the song I wrote about his book.

Read the Spin Article here.

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Music 2.0 – new book from Gerd Leonhard

Music2.0 is a hard-hitting, provocative and inspiring collection of essays and blog posts on the future of the music industry from my co-author Gerd Leonhard. The book continues and expands on the ideas and models presented in our book “The Future of Music”, which has become a must-read work within the music industry, worldwide, available in English, German, Spanish and Italian.

Music2.0 describes what the next generation of music companies will look like and the new principles that will define the next iteration of the music business.

Music2.0 presents the best of Gerd’s writings from the past four years. As you move from 2003 to 2007 in the book, the evolution of various ideas and expressions can clearly be observed.

Check out Music2.0 here!

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The End of Control

My co-author Gerd Leonhard has just published a new work entitled “The End of Control”. Here is an excerpt from the introduction. Enjoy.

“This book is about the most important issue the media business is facing as it tries to move forward: control.

In my work as speaker and advisor, the tough issue of control emerges, again and again, as the key contention point within TV companies, publishers, record labels, and broadcasters: How can a commercial venture that is based on so-called “intellectual property” thrive and prosper in an environment that seems to continuously and progressively remove control from the creators/owners/providers of content, and hands it over to the people formerly known as consumers (aka the users), effectively making them more powerful every single day?

But the reality is that every click inadvertently makes another case for the consumer’s ever-increasing rise in importance. Within all the conversations I have had about things like commercial content versus shared content, about the read-only or the read-write web, and about copyright versus Fair Use, the crucial question always seems to boil down to WHERE IS THE CONTROL HERE, i.e., questions such as “Who will control this new media universe” and “How much control do I need to run a revenue-generating business?”

Network_to_networked

Ever more devices, ever faster broadband, more channels, more platforms, faster processors, endless storage, better search — and still, we have only 24 hours in a day. The real barrier is attention! For many content creators or providers, it may often seem that one’s power to monetize stands to be inadvertently diminished every time some geek in some garage publishes a new piece of code. Today, those digital natives (i.e., the 10–25 year olds who were born as the Net Generation) increasingly self-assemble or pull media, controlling and sharing their own collections — and thereby making the companies that usually purvey their mass-media less crucial in the process.

Seven years after the explosion of the dot-com bubble, the future of media once again seems to be up for grabs. Bloggers and Web 2.0 entrepreneurs; social media and UGC (user-generated content) startups; mobile filesharers and P2P software developers; teenage inventors; hungry telecoms; operators and cellcos; mobile phone makers; worried governments and industry organizations; exasperated venture capitalists and their latest and greatest offspring, search engines and online communities — they all want a nice, juicy piece of the anticipated $ 1.6 trillion entertainment economy of 2010. And they all are hell-bent to take control away from the people who used to have it: the studios, and the titans of content.

This book will offer a counter-intuitive theory of we will get there: Give Up on Control.

Old-media veterans, be they music moguls or newspaper, radio, or TV executives — those who have cherished and at all cost maintained their absolute control over the marketplace — are now howling with disgust as those People Formerly Known as Consumers are becoming their de-facto bosses. They have suddenly lost their Monopoly on Attention. Yes, it’s happening everywhere, in all industries, but it is in media where we are most awestruck by its implications: We will now have to work much harder at getting people’s attention, and to gain and keep trust, rather than just use distribution monopolies to send more stuff they should watch down the pipeline.

What’s more, convergence is no longer just an idea, or a PowerPoint tagline. It’s naked reality for every media company, discussed in every boardroom. And many convergent products are relying on a substantial loss of control by all involved parties. Can we offer converged media services without giving up control? Highly unlikely.

The bottom line is that in the future, we will need to learn how to live and prosper with relative control.

Let’s face it: in a world where digital content is ubiquitously created and made readily available to everyone, everywhere, anytime, we simply will not generate enough revenues by attempting to control the copies (or the access to those copies). Throttling distribution and monetizing scarcity — an operating mode that most media conglomerates have enjoyed since the invention of the printing press, the phonograph, the TV, and the CD — is no longer a viable option. Rather, access to media content will simply be a universal, default, built-in status — and therefore, media will first be a service and only then a product.

Value will be generated by being and remaining the trusted context (formerly known as being ‘the networks’ but now becoming known as ‘being networked’); by becoming the unique purveyor of a particular media experience; and by providing added values, again and again, every time the user shows up — real-life, virtually, or both.

Here and now, the people formerly known as consumers are becoming fully empowered Netizens, and it is the Net Generation that will quickly become the default audience for our content, rather than an aberration. The Digital Natives are taking over everywhere, and they will not play if they, in the aggregate, don’t feel like they control the game, or if they get even the slightest whiff that the game may be rigged.

Social networks are quickly becoming the new radio and stand to have more influence over music trends (and commerce) than MTV ever had; (digital) radio is fast turning into a music retailer and distributor; and smart, software-based taste-making agents are set to become a standard in digital music. Mobile phones are becoming powerful media players, and remix devices, and super-distribution nodes — by default. Ubiquitous Wi-Fi and Wimax will soon mean that online and offline cease to be meaningful terms of distinction.

All of this can be summarized in one conclusion: It is now becoming utterly impossible to control the people formerly known as consumers. Instead, they control the media purveyors — by virtue of millions of mouse-clicks and the power of their combined click-streams.”

End of Control

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Interview on the Future of Music

New Formats

In a recent interview with Doug Dixon, David Kusek argues that the industry needs to develop new formats for music
distributed in physical formats. "Dual Disc is certainly a pointer in the
right direction," he says. "You need to create something that has
great value in order to continue to compete."

For example, in the movie A Clockwork Orange, says Kusek, "even
before CDs were out, they played music on a disk that was a little bigger than a
silver dollar. It reminds me of the idea that perhaps there are other formats
that could be developed, nontraditional formats, from what we have seen so far.
If you had a recordable format that was more convenient than CD, and held more
data, and was faster to record, then perhaps you could have a system where the
recording could be inside the stream of commerce."

The other critical trend, he says, is that "the price of these physical
products needs to come down. I’m encouraged that Dual Disc seems to be priced
around $18 to $20, and discouraged that CDs continue to hover in the $15 to $18
range. I don’t know how much control the manufacturers have over this, but to
the extent they can encourage their customers to be more realistic about pricing
CDs, the longer they will be able to stay in business. I really do believe the
price point for an audio CD is south of $10 at retail."

Music Commerce

But isn’t piracy destroying the industry? "There are two forms that are
currently labeled piracy," says Kusek. "You have the wholesale
replication of CDs and DVDs. To me, that’s counterfeit products and is obviously
not to be tolerated. It is certainly evil and criminal, and bad for
business."

"But the other kind of behavior that is labeled as piracy — downloading
files and trading files with your friends — I’m not sure that I would put that
in the same camp. Often there is no profit margin, there’s no distribution
network, other than yourself and a handful of people that you know. Generally,
you are not selling files to your friends."

"You can measure wholesale piracy and replication in many billions of
dollars, whereas for downloading and file sharing, it’s hard to quantify whether
it has had any negative impact at all in terms of real sales. I actually think
that is good for music, as painful as it may be for to the record
companies."

"I don’t think that file sharing and downloading of music is going to
stop," says Kusek, "until there is something easier, and better, and
cheaper, and more appealing. So as I argue in the book, why not embrace that
behavior, license and tax it, and somehow derive money from it? Make it easier
to find music, improve the quality of the files, and make it easier to record,
instead of trying to fight it. It seems a completely losing battle; People are
never going to stop doing it as long as the price of CDs is too high. So why not
go with the flow and embrace it?"

Investing in the Future

Says Kusek, "by and large the record companies are not in touch
with their customers at any significant level. They thought that their customer
was Wal-Mart. They are out of touch with their ultimate customer, and their
customer shifted away from them. They are still selling a ton of CDs, but the
whole file sharing thing was off their radar screen until someone told them
about it. So then they decided, let’s just go sue all these bastards."

"That bothers me as well," he says. "I ran the numbers, and
somewhere between 30 and 40 million dollars is being collected in the
settlements from the RIAA. But none of that money is going to the artists or
songwriters. It is going to the attorneys and the courts to process the papers,
and whatever is left is going to fund more lawsuits. It’s incredibly wasteful.
The numbers I see show file sharing growing on a monthly basis, ever since they
started the lawsuits, so it is not working. Imagine if they took $40 million and
invested it in a new way of delivering music that is attuned to the way people
want to buy."

To help people in the industry examine these options, Kusek runs an online
course on "The Future of Music and the Music Business" through the
Berkleemusic.com online extension school. "The course is for people at any
level of the music business," he says, "from artists, songwriters,
managers, record company, publisher, promoter, venue. We have had a lot of
people sign up from those areas trying to figure out what am I going to do in
the future: I own a record label, and how I get into this digital thing, or I am
a manager, and I can see that the labels are not really servicing my clients
anymore, so how can I grow my business in an appropriate way. A lot of the work
we do in the class is class projects or personal projects where you apply what
we are talking about to your situation and try to figure out what the next step
might be."

From his classes and consulting work, Kusek also sees differences in the
music business across the global economy. "One of my online students runs a
CD and DVD manufacturing company in India," he says. "They’re finding
that sales are actually quite healthy because the computer thing has not taken
off in the way it has in other parts of the world. I think there are many areas
in the global economy where there are lots of legs left to the existing physical
media, and those folks have more time to figure out alternatives."

Read the complete interview here at Manifest Technology.

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Nightly Business Report on the Business of Music

Watch this week’s Nightly Business Report on NPR and Public Television to see a special series on the Music Business, featuring Dave Kusek and Gerd Leonard.

"On December 6th, 1877, Thomas
Edison shouted a nursery rhyme into his new talking machine. The recording
industry was born.

Over more than a century, the technology evolved from wax cylinder to
shellac platter to long-playing vinyl to cassette tape to compact disc.

But the business model remained the same: The artist recorded to the
label`s satisfaction, the label did the manufacturing and handled the
distribution, and the consumer could take it or leave it.

That changed in the mid-1990s, when personal computers got the ability
to make digital compact discs. Unlike analog, digital recordings are
simply computer data files, and the tools need to create, capture and
manipulate digital music are inexpensive, high quality and widely
available.

Now, consumers can use the recording industry`s compact disc to create
their own compilations, re-edit to produce derivative products, and yes,
make perfect copies.

When the cost of the blank needed for a copy fell to pennies, the
industry`s business model fell apart.

If the ability to easily copy compact discs was a problem for
the recording industry, Napster and other file-sharing systems were a
disaster. Created in 1999, Napster let consumers freely trade the computer
files of songs with others over the Internet. The artists, publishers and
recording companies never saw a dime.

Nearly 40 million people were said to be using Napster when
it shut down. And for every Napster that was shut down, another method to
share files sprang up.
The industry`s trade association sued thousands of people, mostly
college students, to stop the practice. The lawsuits, tens of thousands by
some counts, continue today."

More info here.

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KCRW audio interview: The Politics of Culture

The Digital Age and The Future of Music.

It’s no secret that the music industry is challenged on multiple fronts. Now that we’re in the digital age, how can they change their outlook? Celia Hirschman, KCRW’s music industry commentator, speaks with Gerd Leonhard, co-author of The Future of Music: Manifesto for the Digital Music Revolution.

Listen to the Interview (Real)

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Atlas Plugged Interview Part 2

Held back by fear, you are.

The music industry can’t preserve its current model of total control. Rather, it must embrace P2P and other new technologies because consumers won’t accept anything less than full freedom. In the future,preventing customers from doing things they have grown used to will equal a quickly executed death blow. For the music business, this means that any innovation that will be offered to the marketplace must be without any catches. It must be flat-out in synch with what the consumer will accept and wants, and its integration into the daily lives of the average music consumer must be unobtrusive and effortless.  In other words, keep it simple and give customers what they want.

As Yoda might say, “Held back by fear, you are. To the Dark Side, your stubbornness will lead.” It’s a
fate the music industry may want to avoid.

Read the second part of the interview here.

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Let’s Get Digital – Radio Show

New York – WFUV Presents – If the new world of mp3 blogs, mash-ups, downloads and ringtones boggles your mind, tune in to Let’s Get Digital as host Jen Guerra takes a musical look at all things online.  The New Yorker Pop Music Critic Sasha Frere-Jones, CDBaby.com Founder Derek Sivers, Berklee College of Music Vice President David Kusek, Creative Commons Executive Director Glenn Otis Brown, Analyst Phil Leigh and others join Guerra for an hour-long program examining how the race to get online affects not only musicians, but music fans and the music business in general. 

Let’s Get Digital can be heard on WFUV (90.7 FM) www.wfuv.org and streaming online.

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Atlas Plugged – Interview

"Like modern  plumbing, the music industry could operate almost as a  utility—with copyright holders able to meter usage down to  how many people listened to particular songs at particular  times. In such a world, the industry could live off of micropayments flowing seamlessly back to the owners of  content rather than rely solely on the disjointed and  inefficient distribution of CDs to retailers. Artists, meanwhile, would have unprecedented access to new listeners  as their songs spread virally into vast musical networks  that fans can access literally anywhere. As the most  accessible artists find their audiences, those artists would  enjoy increased concert attendance, new forms of merchandise  and countless other opportunities to connect with fans like  never before."

Read part one of the two part interview

Part two is here

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Keepin’ it Reel to Reel: The Future of Music

To The Best of Our Knowledge

Seven hundred million people get their music from the Internet. More than 10 million people own iPods. Does this mean that compact discs and record companies are going the way of the gramophone and eight-track tapes? In this hour of To the Best of Our Knowledge, we’ll look at this digital music revolution…as we explore the future of music.

Check out this program from Wisconsin Public Radio

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Forbes – Music Like Water

Forbes_80_100

People should pay for their music the way they pay for gas or electricity.
Forbes Article 2005

More people are consuming music today than ever before, yet very few of them are paying for it. The music recording industry blames file sharing for a downturn in CD sales and, with the publishing companies, has tried its best to litigate this behavior out of existence, rather than try to monetize the conduct of music fans. These efforts are fingers in a dike that is about to burst. Digital media are interactive, and people want music that they can burn to CDs, share and use as they wish. The music industry should instead look at turning this consumer phenomenon into a steady stream of cash–lots of it.

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About the Authors

Kusek
About David Kusek

David Kusek is a musician who has been inventing the future of music for the past twenty-five years. He was one of the first to capitalize on the commercial potential of computers and music. As an early synthesizer and electronic music pioneer, Dave cut his teeth on innovation.

At the age of nineteen, he co-invented electronic drums at Synare, which helped ignite the disco era. In 1980, he founded the first music software company, Passport Designs, which made it possible for musicians to record and produce their music at home with its award-winning software.

Kusek is also a co-developer of the Musical Instrument Digital Interface (MIDI) standard that opened up electronic music to literally millions of people. His efforts, along with others, set the stage for the desktop music market that we have today. In 1993, Kusek, with A&M Records, designed and developed the first commercially available enhanced CD that connected audio CDs to a personal computer. He also produces interactive DVDs for BMG Music, Windham Hill Records, and Berklee Press.

Today, David Kusek innovates at Berklee College of Music in Boston, Mass., the premier school for aspiring professional musicians for over half a century. Dave is Vice President of Berklee Media, the continuing education division of the college. In that capacity, Dave oversees some of the college’s most visionary projects. These include: the college’s online extension school Berkleemusic berkleemusic.com, a major initiative to expand music education worldwide; Berklee Shares berkleeshares.com, a venture that taps the potential of digital networks and music content licensing by making a broad selection of Berklee’s curriculum free and universally available online; and, Berklee Press berkleepress.com the publishing arm of the college. Kusek also provides strategic consulting and advisory services to companies and individuals involved in the music and entertainment industries.

Kusek has written for or been quoted in Billboard, Boston Globe, New York Times, Wired, Christian Science Monitor, Associated Press, and San Francisco Chronicle, Forbes, NBC-TV, Nightly Business Report, NPR, Corante, The Deal, Inside Digital Media, the Financial Times.  Kusek has been interviewed by over 25 radio stations nationwide. He has been a speaker and lecturer at Berklee College of Music, MacWorld, Comdex, PC World, NAMM, AES, and California State University.

Dave lives near Boston and can be contacted at dkusek@digitalcowboys.com.

Gerdleonhard_1
About Gerd Leonhard

Gerd Leonhard is a respected music futurist and oft-quoted visionary, a well-known music industry executive and music business entrepreneur, a sought-after strategic adviser and music industry super-node and still a performer (guitar), writer, and producer. A native of Germany, Gerd has spent more than twenty years in the U.S. music, e-commerce, and entertainment technology industries, and is equally at home in the U.S. as well as in Europe.

During the dot.com days, Gerd was the founder and President/CEO of LicenseMusic.com, a company that revolutionized music licensing, reducing the average transaction time for music licenses from six weeks to two hours. LicenseMusic, Inc. served thousands of clients from 1996-2002, including Disney, Paramount Pictures, and Fox TV.

He is the Founder and CEO of ThinkAndLink (TAL), a boutique advisory agency based in Basel, Switzerland and San Francisco. TAL connects people, ideas, companies, and resources in the converging sectors of entertainment and technology, and catalyzes their development. As CEO of ThinkAndLink, he serves as Senior Advisor to Media Rights Technologies, BlueBeat, and ShareTheMusic Networks. Gerd sits on the Advisory Board of Musicrypt, Inc., and works with dozens of startups and new ventures in the entertainment and technology industries in Europe and the U.S.

Gerd served as the Executive Producer of the pan-European talent event EuroPopDays, as Expert Advisor on the Cultural Industries to the European Commission in Brussels in 1993-1996, and as Senior Strategic Adviser to Rightscom Ltd. (London). Gerd graduated with a diploma in Jazz Performance (Guitar) from Boston’s Berklee College of Music (1987), and won the college’s highly acclaimed Quincy Jones Jazz Masters Award. His performance credits include touring internationally, including opening engagements for major acts such as Miles Davis.

Gerd has been quoted in Billboard, Variety, Hollywood Reporter, San Francisco Chronicle, Business2.0, Wall Street Journal, and Wired, and continues to speak, moderate, and/or present at the music industry’s biggest events. He publishes his music business visions at MusicFuturist and you can visit his Web site at gerdleonhard.com.

Gerd currently resides in Basel, Switzerland and can be contacted at gleonhard@gmail.com.

Contact

The authors can be contacted via snail mail at:

David Kusek
Berklee College of Music
1140 Boylston Street
Boston, MA USA 02215

Press contact:

Lori Ames
212-620-4080 x12
lori@wesmanpr.com

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