U2's manager: how to save the music industry

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By Neil McCormick, The Telegraph UK

Bono's back. And so am I.

I've been on holiday and so (no doubt to the dismay of my personal Twitter parodist) missed the return of U2 to live action. I gather all is going well and that Bono's back problems have been sorted out: "rebuilt by German engineering" as the man himself said. Apparently his doctor told him he would "run further and faster in the future." Vorsprung Durch Technik and all that. I still say they could have saved a lot of money, disruption and heartache with the simple deployment of an ergonomic stool. It worked for Val Doonican.

Anyway, enough about the man who stands at the front of the U2 juggernaut. In the new issue of GQ, we hear from the man who stands behind it. Manager Paul McGuinness has written a fascinating article: How To Save The Music Industry.

There is no doubt this is a business in peril. Every economic quarter brings more bad news from the commercial frontline. Put bluntly, falling CD sales are not being matched by rising legal digital downloads, and all the mooted new revenue streams of sponsorship, sync deals and direct sales are not taking up the slack. Even the live scene, supposedly the last refuge for working musicians, is suffering, with major stars failing to sell out dates.

The battleground of the music industry (and, indeed, every creative industry) is copyright, and McGuinness has placed himself at the forefront of this campaign for several years.

At the Midem Festival in Cannes in 2008, McGuinness made a forceful speech calling on governments to compel internet service providers (ISPs) to introduce mandatory "three strikes and you're out", internet service disconnections of serial file-sharers. He accused Apple, Google, Yahoo, Facebook and others of "building multibillion dollar industries on the back of our content without paying for it" and of being "makers of burglary kits who have made a thieves' charter to steal music from the music industry". Strong stuff. Since his speech, governments in France and Britain Ireland, have introduced the "three strikes" law. And the music industry has continued to decline while the ISPs continue to flourish, shrugging their shoulders in apparent indifference to the fate of an industry on which they have fed for so long.

McGuinness's GQ essay is an interesting and well-informed attempt to define the problem and suggest possible solutions. McGuinness, at his most optimistic, envisages "a world of millions of micro-payments, paid daily and triggered by technology that will track every use of a song, identify the rights owner and arrange instant electronic payment. Music subscription will be the basic access route to enjoying tracks and albums, but by no means the only one. Households will pay for a subscription service like Spotify, or they will pay for a service bundled into their broadband bill, to an ISP such as Sky and Virgin Media. But many customers will also take out more expensive added-value packages, with better deals including faster access to new releases. There will also be a healthy market in downloads to own and premium albums. iTunes will be fighting its corner in the market, probably with its own subscription service. And a significant minority will still buy CDs, coveting the packaging, the cover designs and the sense of ownership:

In the future I envisage every piece of music will be licensed to be available at any time on any device. All music will be transferrable between computer and portable device. ISPs will be reporting significant revenues from their "content ventures." These are the added-value businesses that over time they must move into as their flat-rate broadband business reaches saturation point. This is not fantasy: an independent survey by Ovum recently predicted that ISPs in the U.K. could earn more than £100m in digital music revenues by 2013. In the beautiful future of my dream, every record label and every ISP will be joined in commercial partnership, sharing revenues and strategies to get their music to as many millions of people as possible.

I hope he's on the right track. Clearly, for the music business to survive with anything like its current abundance, someone needs to find a way to pay musicians and other copyright holders for their work. We may indeed be moving towards a global jukebox, where you can access any track at any time, effectively paying for your musical entertainment by subscription, licence fee or some kind of hardware levy (an entertainment licence fee levied on every mobile phone or computer, for example). This would require a next generation technological leap, new kinds of business alliances between hardware makers and creative industries and a global political agreement on copyright. Perhaps ISPS need to take on the roles of record companies and invest in creative talent, instead of just exploiting it? Imagine the power of Apple computers united with the Beatles old Apple music label.

But I think there are other possibilities, and one (though few in the music business really want to contemplate it) is that the age of mass market music is truly coming to an end, and the music business will dramatically shrink to more historically consistent (and possibly localised) proportions.

We live in the age of the amateur. Music (like all forms of artistic self expression) is an innate human talent, and the internet (along with the cheap and easy recording technology provided by computers) has unleashed a tsunami of self-expression. In human history, there has never been more music made by more people (and made available to be heard) than there is right now, even if few can make a living out of it. But in all this abundance of music, where are the geniuses to rival the all time greats? Is music getting more interesting? Or just more ... everything? Do we really need all this music?

Maybe music will be something people do for a while and then move on, a Myspace site and YouTube video being the 21st century equivalent of being in a band at college. For people who make music just to have fun making music, times have arguably never been better. As the economic benefits of the music business shrink, there's a good chance that ever fewer dilettantes will get involved for that most 20th century of motivations, "fame and fortune." And as it gets harder and harder to make a living, only the truly vocational will persist. With this, the talent base may shrink but the greatest (or at least most driven) talents should still, like the cream, rise to the top. Maybe the future of music will be a huge field of free amateur music and a much smaller but genuinely exceptional base of professional musicians.

Such an outcome would probably not be particularly appealing to most people involved in the music business today. But the survival of the mass market music business is not a given. The internet is changing everything. I have a lingering suspicion that the music industry's future shape will be dictated by technological developments and social and economic changes we can't even foresee at the moment. There is only one thing of which I think we can be certain. There may not always be a music business. But there will always be music.

© Copyright of Telegraph Media Group Limited 2010

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1 Comment

You want my dollars, put out live content on CD; not DVD - CD. I, and many others, would eat it up.

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This page contains a single entry by Jonathan published on August 18, 2010 8:27 AM.

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