DMW: Digital Music W...

Did the music industry do alright in 2005? It depends who you ask. It seems that our friends across the pond did a lot better on music downloads as well as performance in general. One only needs to look at the latest Top 50 list of anybody's year end music list and for the most part, bands from the UK have dominated. All I had to do was look at my CD and iTunes purchases for the year and 90% of the titles I bought were UK-based acts.
To ask the same question to the big four music companies - Sony/BMG, Universal Music Group, EMI and Warner Music Group - their answer would be, "Eh..." They are being subpoened by NY State Attorney General Eliot Spitzer for price manipulation of digital downloads. On top of that, their current business model of promoting music through conventional streams (radio) is badly outdated and needs a complete shakedown. The industry's constant hunt for illegal downloaders has strayed the industry away from serving the public entertainment to serving the public legal papers. The rootkit that Sony/BMG proudly touted several months back became a blowback to the industry on their constant fight against illegal copying. And lastly, the music industry just doesn't give a crap about the listeners or their artists.
There was an article in The New York Times about the state of indie record labels and they are faring somewhat better than their behemoth counterparts. The only difference, really, is their open-minded attitude towards using the Internet as a real marketing tool and not some digital alleyway where people get virtual blowjobs.
If there is anything the music industry should learn from 2005, is the fact that they are losing grip of their own assets. The power resides among the listeners and that is scary to the big four music companies. What should the music industry do in 2006? For starters, re-think and re-shape your business model. CDs are or will be phased out sooner than later (think Blu-Ray, MagicGate, kiosks, portable players). The days of the physical CD are numbered. Just look at the automotive industry. What's being outfitted in cars? Satellite radio and CD players that have MP3 playback capability. What's next? I can tell you. iPod connectors will be the next standardized equipment. And make room for memory cards. Yeah, laugh. But you know things will head that direction.
And for the love of God, use the Internet, don't handcuff it. If music companies really want to see profits, they should allow listeners to access music catalogs online. Allow your bands/musicians to have their full album available for limited download or have the entire album online and trust your listeners. If they like it, they will buy it. Look at Jane Siberry. At least she's trying and giving listeners a chance to prove to the industry that not every downloader should be treated as a criminal. Show a little respect and you get the same in return.
I know that sounded a little caustic and somewhat berating, but the bottom line is, the big four music companies are at a crossroads in digital music. They are still working off of a very, very old business model and it is time for them to re-write that business model to reflect the changing of tastes and technology. What can they use as a model? Uh, the cable industry.