Mehan Jayasuriya's blog

Yesterday's New York Times featured an interesting article on the current state of the music industry. In it, the Times reveals that Atlantic Records has become the first major American record label to derive the majority of its revenue from digital, rather than physical sales of music. Apparently, digital sales--including sales of ring tones, ringback tones, MP3s and royalties from satellite radio and subscription music services--now account for some 51 percent of Atlantic's revenue. It is believed that Atlantic is the first major label in the U.S. to hit this milestone--data from Forrester Research suggests that the recording industry as a whole won't reach this point until 2011. “That’s very high," Forrester Research digital music analyst David Card told the Times. "No one is near that.”

This news might be a bit stale (in Internet terms, at least) but given the fact that we pointed directly to Radiohead's In Rainbows release strategy in our section on alternative methods of distribution, I think it's still quite relevant. At the “You Are in Control” conference in Iceland last month, Warner Chappell’s Head of Business Affairs, Jane Dyball, released a report containing sales data relating to In Rainbows, Radiohead's seventh studio album. As you will recall, In Rainbows was initially self-released as a pay-what-you-want download in October 2007, at which time Radiohead were not under contract to a record label. The album was later sold both as a deluxe "discbox" though Radiohead's online store (W.A.S.T.E.) and on other formats (MP3/CD/Vinyl) through various labels around the world. So, what were the results of the experiment?

Last week, Wired's Threat Level blog ran a great feature, which takes a close look at the RIAA's ongoing legal campaign against filesharers on the fifth anniversary of the first RIAA suits. Since then, the RIAA's campaign has expanded to include a whopping 30,000 lawsuits, nearly all of which have been or will be settled out of court. While the Copyright Act allows for statutory damages of up to $150,000 per infringement (i.e. per song), the RIAA has been generous enough to settle most cases out of court for a few thousand dollars--thereby ensuring that most defendants choose a quick cash settlement over costly legal fees and months of litigation, regardless of guilt. Obviously, the RIAA has managed to raise quite a bit of money for its own pursuits through this legal campaign (not a single cent of which has gone to the artists the RIAA claims that it's working to protect, mind you). But what else has the music industry lobbying group accomplished during the last five years?

While there are a seemingly infinite number of ways to share and discover new music, few are as mythologized as the mixtape. From Nick Hornby’s romanticizing of the format in High Fidelity to Library of America editor-in-chief Geoffrey O’Brien’s assertion that the mixtape is “the most widely practiced American art form,” no other amateur medium commands the same level of respect from fans and critics alike. While the general principles of mixtape making continue to live on in even the post-iPod era, with the exception of a few purist holdouts, most mixtape curators stopped using magnetic audiotapes long ago, in favor of the more convenient CD-R. Recently, however, even more advanced tools have emerged on the web, allowing would-be mixtape traders to widely disseminate their tastes while easily tapping into those of their friends.

One such site, Muxtape, allows users to upload, sequence and stream 12 MP3s in order to create virtual mixtapes. Web radio services like Pandora, meanwhile, allow users to discover new music--as mixtapes once did--based on their existing tastes. And social music sites like Last.fm allow users to broadcast their tastes automatically, by generating radio stations based on the user’s listening habits. All of these technologies provide fans with new ways to interact with and discover music and have the potential to generate quite a bit of excitement for both independent and major label artists. That last fact seems to be lost on the recording industry, however, which, as usual, is too busy trying to stuff the genie back into the bottle to know a good opportunity when it sees one.