Digital Home Thoughts: The Music Industry Is Playing a New Tune

"...It remains to be seen if the recording industry has what it takes to thrive amid Internet distribution, but it is clearly on the right track, says former musician Jeffrey Babin, India global country manager for the Wharton Global Consulting Practicum. "The recording industry is doing what it should." A few examples: 1) EMI Music announced on July 6 that it would back a yet-to-be-named record label, started by a management company called The Firm, that abandons the recording industry's traditional royalty payment system for what EMI terms a more "artist-friendly" profit sharing scheme. Instead of paying artists upfront and taking the bulk of the profits later, The Firm will split profits with artists signed to the venture. In theory, this arrangement should lower the risk and upfront costs of finding new talent and encourage more innovative promotion... 2) Vivendi's Universal Music Group on July 5 announced a three-tiered pricing system for CDs that targets everyone from consumers who want no-frills music to those willing to pay more for fancy extras included with the music tracks... 3) On July 19, Sony BMG and Yahoo began offering a new Jessica Simpson single for $1.99 without digital rights management (DRM) software restricting how and where the music can be played. Instead, the song will be distributed as an "open" MP3 file and is available personalized with the buyer's name in the song (assuming the purchaser's name is among the pre-set list of several hundred names available). As a previous Knowledge @ Wharton story noted, most DRM schemes have been widely criticized by industry analysts. Indeed, Yahoo Music's blog noted that "DRM doesn't add any value for the artist, the label ... or the consumer. The only people it adds value to are the technology companies interested in locking consumers into a particular technology platform."

An interesting article outlining the various experiments the music industry seems to be performing or late. Will the experiments prove successful? Only time will tell of course, but I can only cheer this new direction the industry's taking. More purchase options can only be a good thing as far as I'm concerned. And DRM-free music downloads? Count me in - it's the main reason why I don't download music in the first place. Too bad it's Jessica Simpson. :roll: