Monday, 21 September 2009

Why doesn't the music industry have answers to the big questions?

It will not have escaped your attention that for the past two weeks the UK music industry has been ‘debating’ (in public, via the press) the Government’s latest proposal to clamp down on file-sharers by forcing ISP’s to issue temporary suspension notices to persistent file-sharers.

Lord Mandelson announced the move, got mixed reviews but industry-wide support from BPI, PPL and HMV, underlined his position vaguely in The Times, but then the FAC (together with BASCA & MPG) – waded in with various comments amounting to ‘serious reservations’. The main thrust of their argument being summed up by Dave Rowntree as “taking a sledgehammer to crack a nut”. UK Music (how many music-based associations are there?) has stepped in to try & broker common ground.

It’s good to see artists voice their opinions in the debate, with Lily Allen blogging and writing an op-ed in The Times against the FAC, followed by Matt Bellamy from Muse chipping in with the ‘solution’ of the compulsory collective licensing of music for digital platforms.

Having read a bunch of press about all this I have at least one observation and it’s this:

What’s happened to the facts?

Where’s the established evidence – empirical & researched – that clearly benchmarks the position that file-sharing has damaged the music industry in terms of sales, artist development, investment in new artists & creativity, and jobs? In the various articles I haven’t seen a single figure, specific or contextual. The work just hasn’t been done. Or if it has, it hasn’t been well communicated.

No wonder it’s proving difficult to get unified agreement. Some members of the FAC have wheeled out the old adage that ‘file-sharers are also music buyers’ – an established fact, sure, until the issue of causality is considered, until the changing nature of that relationship is explored.

Now it’s easier said than done, I know. I’ve had enough experience, in music and other industries, to know that when you do work to try & know something (as opposed to a quick & dirty bit of lazy desk research to try & back-up a PR position) you open up a can of worms. People will argue over costs, methodology, timing, objectivity & god knows that else. You must be ready for that debate – and the facts, the evidence, the methodology, is what makes you ready.

It’s not a luxury. It’s necessary to try & research – from multiple sources if you have to – some kind of impact analysis that can form the basis of debate, policy and decisions. The music industry doesn’t have a great track record in this area however, due to the sheer complexity of the industry value chain, but also due to the lack of will and resources when it comes to factual, evidence-based understanding.

There shouldn’t be any room for debate left about the impact of file-sharing on the music business. But the press, academics and sizeable elements of the artist community and music consumers, remain unconvinced or at best sceptical.

It’s partly a symptom of legacy. Home taping didn’t kill music – that particular relationship was badly communicated and poorly understood and still leaves a bad taste. But the music industry has never had a good handle on other major relationships, like radio airplay and record sales (i.e. overall record sales not just for those artists on heavy rotation). Like singles and albums (it’s never been concluded whether singles promoted or cannibalised album sales). More recently, we seem to have no real analysis of the substitution effects of music streaming services (to be fair, it’s a little too early to say, but I know what my hypothesis would be).

As the current ISP & file-sharing enforcement debate moves on (hopefully soon) in the direction of alternative solutions, we will again be revisiting the idea of the collective license and whether that is a viable solution for the music industry.

I’m a sceptic of this solution – directly because of the analytical work I’ve done in this area – on a couple of separate occasions working with different parts of the industry. But that was over two years ago and things have moved on since then, what with ad-funded streaming, ISP mooted solutions and a dangerous slowdown in digital music growth.

Soon might be the time to look at collective licenses again. But once again, who is now developing the methodologies and gathering the objective facts and evidence to understand the impact for artists, music providers, ISPs, consumers and the Government?

It needs work – a budget, a methodology and a consultation process. Maybe the Government could facilitate the music and ISP industries to collaborate on doing that?

This blog asks a major question of the industry each day this week. Tomorrow's big question - Why didn't In Rainbows open the music industry floodgates?


Anonymous said...

I note your CV says you were Director of Strategic Research & Analysis st IFPI 2000-2006.

That title suggests to me that you above most would have more factual insight into the impact on the business?

I only need to look around at the redundancies to many of my colleagues the business to know how massive the impact is

Keith Jopling said...

Indeed I was, and made the best I could with gathering, analysis, consultation & presentation of a lot of data in this area, during that particular era. But there's a more urgent need now - to engage with a lot of new associations and players in the digital music business. It's a lot more complex & messy than it was a few years ago. I don't come across many clear objective facts or insights in the debate in what I read these days. I agree with you about the job losses, but many don't - seeing these as detached from the impact of file-sharing, or at best indirectly related. I don't think the industry would have anything to fear from an objective, authoritative study into this area.