No wonder the Recording Industry is troubled +Shocking Quote from Universal Music CEO

Kaosaur

Kaosaur

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http://nymag.com/daily/entertainment/2007/11/universal_music_ceo_doug_morris.html

When Morris is asked why the music business didn't work harder, in the early days of file-sharing, to build its own (legal) online presence, there's this exchange:

"There's no one in the record industry that's a technologist," Morris explains. "That's a misconception writers make all the time, that the record industry missed this. They didn't. They just didn't know what to do. It's like if you were suddenly asked to operate on your dog to remove his kidney. What would you do?"

Personally, I would hire a vet. But to Morris, even that wasn't an option. "We didn't know who to hire," he says, becoming more agitated. "I wouldn't be able to recognize a good technology person — anyone with a good bullshit story would have gotten past me."
Click to expand...

If I were their shareholders right now, I would be asking for his head. How can you have any confidence in an executive that doesn't know how to hire people. One of the most important qualities of even the lowest level manager is the ability to hire people who know how to do what you don't/can't. This man is responsible for running an empire...and now I seriously doubt that he even has any clue at all.

They held on to (and are still holding on to) a failing, inflexible business model for far too long. Folks...it's too late.

EDIT: check the linked article here as well: http://www.wired.com/entertainment/music/magazine/15-12/mf_morris
 
Kaosaur said:
If I were their shareholders right now, I would be asking for his head. How can you have any confidence in an executive that doesn't know how to hire people. One of the most important qualities of even the lowest level manager is the ability to hire people who know how to do what you don't/can't. This man is responsible for running an empire...and now I seriously doubt that he even has any clue at all.
Click to expand...

I think the biggest problem wasn't that he (and others) didn't know WHO to hire, but more that they weren't able to identify the problem at first. It's like if you feel like you have a cold for a while, but you aren't sure if it's just something temporary or something serious and you don't go see a doctor about it. Then suddenly it's really serious and it's too late to do something about it. You might curse yourself for not having called the doctor at first, but you didn't see the problem as being serious enough back then to actually do so. The question is: would you call (and pay for) a doctor if you were just having a cold - or would you wait till you saw it evolving into something serious? I guess most of us would save the money and just see if it would pass on it self.
 
They are making so much money off ringtones right now, that they didn't really miss it.
 
Claus / Intromental said:
I think the biggest problem wasn't that he (and others) didn't know WHO to hire, but more that they weren't able to identify the problem at first. It's like if you feel like you have a cold for a while, but you aren't sure if it's just something temporary or something serious and you don't go see a doctor about it. Then suddenly it's really serious and it's too late to do something about it. You might curse yourself for not having called the doctor at first, but you didn't see the problem as being serious enough back then to actually do so. The question is: would you call (and pay for) a doctor if you were just having a cold - or would you wait till you saw it evolving into something serious? I guess most of us would save the money and just see if it would pass on it self.
Click to expand...

Problem is they went way past a common cold and waited until they had coughed up a lung to try to fix the problem. Now they're bed ridden and on life support. Personally I think it was simply arrogance. They had done it one way forever and they were too stubborn to change and embrace the new technology.

Now, I fully endorse buying the artists products, but what was the labels reaction to all this...sue their customers. Instead of realizing they were way behind and needed to get out in front of this, they sued the people who they wanted to buy their product...sound business strategy there. They botched this from the very begining and have no one to blame but themselves.

Just my opinion...and I'm not all that bright really, so....:loco:
 
Cheiron said:
They are making so much money off ringtones right now, that they didn't really miss it.
Click to expand...

You're right. The market for rap/hip-hop ringtones is amazing. I can't believe the amount of money the labels make on just ringtones:

"In 2005, tones pulled in $600 million, 20% ahead of estimates and more than double the 2004 take. The year's leader, 50 Cent's Candy Shop, sold 1.9 million downloads, more than the top-selling digital song: Gwen Stefani's Hollaback Girl, with 1.2 million."

http://www.usatoday.com/life/music/news/2006-01-25-ringtones_x.htm

With that kind of demand for just one ringtone, it makes me wonder, why isn't there a problem with illegal downloading of ringtones (or is there?). It would seem technically possible, but I'm certainly not a ring-tone expert. I just haven't heard anyone in the industry stating that illegal downloads of ringtones cuts into legit ringtone sales, and it's hard to imagine a ringtone selling 1.9 million copies if it could be downloaded at no cost from a torrent or other internet source where full songs are downloaded illegally.
 
Cheiron said:
They are making so much money off ringtones right now, that they didn't really miss it.
Click to expand...

lol exactly. That whole exchange from Universal is such bull! These major labels spend millions of dollars trying to be as "hip" and "trendy" as possible. I've even read an article saying that many major labels will purposely hire younger people as A&R reps so that bands can easily relate with them. In reality, the "A&Rs" are just as naive as the bands! Anyways my point is if these labels could spend so much time, effort, and money on being as current as possible, they could give a few bucks to college kids and get on the inside. Duh.

The real reason is that they simply could not have stopped file sharing. Nobody could have- and they still can't. Obviously labels aren't going to say that because it would come off sounding even worse.
 
The Fiddler said:
You're right. The market for rap/hip-hop ringtones is amazing. I can't believe the amount of money the labels make on just ringtones:

"In 2005, tones pulled in $600 million, 20% ahead of estimates and more than double the 2004 take. The year's leader, 50 Cent's Candy Shop, sold 1.9 million downloads, more than the top-selling digital song: Gwen Stefani's Hollaback Girl, with 1.2 million."

http://www.usatoday.com/life/music/news/2006-01-25-ringtones_x.htm

With that kind of demand for just one ringtone, it makes me wonder, why isn't there a problem with illegal downloading of ringtones (or is there?). It would seem technically possible, but I'm certainly not a ring-tone expert. I just haven't heard anyone in the industry stating that illegal downloads of ringtones cuts into legit ringtone sales, and it's hard to imagine a ringtone selling 1.9 million copies if it could be downloaded at no cost from a torrent or other internet source where full songs are downloaded illegally.
Click to expand...

I own 10 phones just to hold all the illegally downloaded ringtones I have LOL.

Personally I cannot see the point of ringtones...but to each his own I guess.
 
The only thing the labels could have done was instead of fighting P2P, they could have immediately started looking for ways to make things such as iTunes, Walmart's, Rhapsody, emusic, etc... to work better for them.

I mean seriously. Do any of you think 'hey i'll download an album to stick it to those nasty guys in the music business that went after Napster!' If so you must be on crack.
 
Greykiller said:
I own 10 phones just to hold all the illegally downloaded ringtones I have LOL.
Click to expand...

I don't even own a cell phone, so bear with me - I'm just asking for a bit of enlightenment - not a downloading debate. ;)

Is the only way to download a ringtone to download it directly to your phone, or can you download them to your hard-drive and then upload the ringtone to your phone (like you download an .mp3 and upload it to your .mp3 player)?

I'm just trying to figure out the nature of ring tone files that makes them less appealing for illegal downloading than individual songs.
 
The whole problem with the music industry is that it is run by business people, not technology people. These are the bean counters who see only one side of the picture. They don't understand the technology behind it. Ask these CEOs how a CD works - they have no effing clue.

I think their problem is that they don't understand the delivery of the music on something other than a tangible product - vinyl, cassette, CD, etc. Once you've left that realm, they don't know how to make their business model work.

Technology has passed them by. Most of them just don't understand how to make it work. iTunes is by far the most successful of the legal ways to deliver music electronically - which is now the most perferred delivery method of music.

Of course we've all discussed this to death about illegal downloads and the reasons behind them. These music (record) companies must realize the desires of the listening public have changed substantially. They need to change marketing strategies. The ways you marketed things even 10 years ago don't apply now. They need to get their heads out of the sand. Figure out how to make money while still delivering the goods.

Several simple methods can work - charge by the song, the album, or streaming. People want to listen first, then buy. Let them sample the music online. And them make it easy for them to buy. Don't push a CD unless the customer really wants it. I still like CDs, but many people have abandoned them. So don't force them down their throats. Even the illegal Russian MP3 sites let people sample the music before they buy. Record companies must do the same. Its competition folks - they need to compete in ways they are not comfortable in doing.

You have to change with the times, and changes are coming faster and faster. But this move from the tangible to the electronic is a pardigm shift that the music industry still doesn't know how to handle. Time to get people who understand the technology in there. Bean counters need to let the technology people work out a solution. "Shift happens" - get used to it. They must leave their comfort zone in order to stay competative.

My 2 1/2 cents.
 
Diamond45 said:
The whole problem with the music industry is that it is run by business people, not technology people. These are the bean counters who see only one side of the picture. They don't understand the technology behind it. Ask these CEOs how a CD works - they have no effing clue.
Click to expand...

I do agree. However, I don't know of any technology that can make $0.99 = $0.00 or $15 = $0.00. The need for the industry to embrace technology and do better marketing is talked about a lot on this forum. It would certainly help the revenue streams (and the money available to songwriters) to an extent in regards to the honest consumers who purchase what they sample. But as long as the industry's competition is offering the same product to keep for free with no obligation to buy later, it's hard to imagine how better marketing or a better understanding of technology will change the fact that free is free.
 
Diamond45 said:
Some carriers, like Verizon, lock their phones so you can't upload your own ring tones...

Unless you know the workarounds..... :devil:
Click to expand...

Thus presenting an example of an industry that was awake, aware, and in full possession of a lobbying force of damn near epic proportions to help perpetuate its business model - and even they're not going to be able to hold out forever.
 
The Fiddler said:
I do agree. However, I don't know of any technology that can make $0.99 = $0.00 or $15 = $0.00. The need for the industry to embrace technology and do better marketing is talked about a lot on this forum. It would certainly help the revenue streams (and the money available to songwriters) to an extent in regards to the honest consumers who purchase what they sample. But as long as the industry's competition is offering the same product to keep for free with no obligation to buy later, it's hard to imagine how better marketing or a better understanding of technology will change the fact that free is free.
Click to expand...

Most people don't download music simply because it's free. People download music because it is more convenient. Yes, price happens to be a major factor in determining convenience. What the labels needed to do was to provide a way for people to get their product that was MORE convenient than going online and getting it for free. This is not impossible. Higher speed downloads? Guaranteed availability of content? Extra content/privledges? Deals on concert tickets? The list goes on.

Downloading has two big things going for it: 1) It's free. 2) You can get it without having to leave your house or (usually) wait on line.

For you downloaders though, especially those with tastes in music as strange as us: How many times have you gone online looking for an album that you simply couldn't find? Now think about if you had seen that album in a store at a reasonable price... You would have bought it, right?

People who download music because it's free will only get their music for free. They are simply put, not customers. They are like the people who go to a bar that offers $1 drinks on an off night and for two hours only. They go there only on that night, get drunk and leave. These people are not ever going to do anything to help your business no matter what you do. Thankfully, these people are the extreme minority.

At this point, iTunes has proved that people are willing to purchase downloaded songs (we can save the DRM issues for another argument) if there is a convenient platform in place to support it. It is exactly what the record companies should have supported from the very beginning.

People who make it a point to only get music when they can get it for free are, simply put, thieves. They should not be considered in the business models whatsoever...and the music companies should have every right to go after these people (and it should be just these people) with every legal option available to them.
 
I'm waiting for Google (or somebody else... if such a model could work..) to have their own music distribution which is free for listeners and paid for by advertisements.
 
The Fiddler said:
I do agree. However, I don't know of any technology that can make $0.99 = $0.00 or $15 = $0.00. The need for the industry to embrace technology and do better marketing is talked about a lot on this forum. It would certainly help the revenue streams (and the money available to songwriters) to an extent in regards to the honest consumers who purchase what they sample. But as long as the industry's competition is offering the same product to keep for free with no obligation to buy later, it's hard to imagine how better marketing or a better understanding of technology will change the fact that free is free.
Click to expand...

You like to harp on that point. Getting music "for free" still requires a lot more work for the *average* consumer than going to Amazon.com and buying it. Had the business been awake and morphed its business model instead of sticking its collective head up it collective ass, they'd have taken a hit, but would be in far better shape, IMO, going forward.

Free is only free if it's convenient and easy for the mass market. File sharing isn't quite *that* easy, no matter how it's painted.

You can't control the illegal downloading market, so while it's existence is a relevant fact, it's not a particularly useful one. You *can* control your legal distribution presence, and the majors basically chose not to pay any serious attention to it - and they still don't.

What kind of idiocy does it take to see people all over (insert urban area here) with iPods and not realize that you need a digital distribution presence?

To use an example: My wife uses a computer every day, and she'd never bother to visit a torrent site (which, BTW, I never visit either) to download something. However, if she could download something quickly, easily, and cheaply from Amazon (to use a common portal example) to put on her iPod without fear of having to buy it over and over, she'd do it. I'll bet there are a lot more consumers like her out there than like me, just from "armchair analysis".
 
The Fiddler said:
I don't even own a cell phone, so bear with me - I'm just asking for a bit of enlightenment - not a downloading debate. ;)

Is the only way to download a ringtone to download it directly to your phone, or can you download them to your hard-drive and then upload the ringtone to your phone (like you download an .mp3 and upload it to your .mp3 player)?

I'm just trying to figure out the nature of ring tone files that makes them less appealing for illegal downloading than individual songs.
Click to expand...

Downloading ringtones and getting them on your phone is at about the same teck level as getting songs off the net and playing them on your pc back 1997 or so. You can do it, but you have to have the right equipment and a tiny bit of geek knowledge.

I have a verizon phone, and all I had to do was pull out an old camera cable and download some free software, and I was able to put whatever ringtone I want on my phone. I hate ringtones and cannot have them on in the office, so it was never a priority to have them--but even a teck noob like I can do it.

Phone teck is advancing so fast though, I predict even people like my wife will be uploading ringtones before I know it.
 
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