It's not too often you hear good things about record labels and the music industry. The people who dropped the ball on the digital era -- and who continue to send take-down notices to college students because of it.
But we still have a lot to learn from them.
Like all media industries there's more than a few similarities between music professionals and, say, journalists and librarians.
Don't know much about history
The music industry, by many accounts, was a bloated racket, where people were paid handsomely to find, support and market acts to a wide audience. While inefficient, this method was very profitable largely because the important place music holds in society. People were more than willing to pay to listen to music, either directly through physical sales or concerts, or indirectly through radio advertising.
This arrangement lasted so long because a single big hit could support the sunk costs of finding, supporting and marketing dozens of other bands.
Record companies played the role of gatekeepers. Musicians who wanted to create and sell an album had to get signed by a label. People who wanted to listen to music were dependent on music labels to give them new bands to listen to. As were record store managers who needed to stock their shelves or disc jockeys who needed to fill their airtime.
The long tail
Those days are long gone, of course. Bands no longer need to beg labels for up-front money to rent expensive studio time to produce an album when it can be easily done in a living room. Now that music is digital, customers are no longer dependent on purchasing physical items to listen to music. Not only have the record labels lost out on digital distribution (for many reasons), but so have other downstream channels like record stores. And, it's easy to see why: The best stores could hold 10,000 titles. But Myspace, estimates say, holds several million different acts.
The rise of digital formats certainly changed audience behaviors, often at the detriment of the labels. For obvious reasons, record companies were cut-out of users' peer-to-peer trading. Even as the record companies took legal action to shutter them, they missed out on the rise of legal digital services like iTunes and Amazon. Music streaming is now growing, and companies are tinkering with trying to bring in money through charging ads -- like YouTube or sites like Pandora or Spotify -- or charging for subscription fees, which YouTube may soon do or the Sony Music Service currently does.
When the music's over, turn out the lights
What does this have to do with librarians? Well, has the record company as gatekeeper been supplanted by the digital environment? Yes. But is there still a need for record companies? Some would say yes -- and this is where the other media professionals need to take heed.
Record labels can still provide a service to help users find new artists, cool acts, whatever. In fact, long-time music exec Mike McCready says finding and developing acts is such a time consuming process -- not to mention expensive -- that professionals have to do it. Labels still have the wherewithal to find, develop and produce new music. They understand audiences -- and how to market to them. The mass audience, for music, is probably not ever going to be the same. However, music fans have long grown accustomed to being sliced and diced into niches.
In a story for PBS Media Shift, Brenda Walker of Rebel Content said that smaller labels will be able to tap audiences--mostly, because they know they know how to market directly to certain consumers. They'll also use their talents in figuring out new ways to distribute music, which is probably the biggest hurdle facing the industry. (Especially with large forces like Google, Amazon and Apple now involved.)
Against the tide
Some labels are also learning to swim against the tide. NAXOS has long made headlines by circumventing the traditional means of creating and distributing classical music and going a different way. Instead of spending lavishly on recording stars, they began by giving fledgling performers the opportunities to record, but by paying them bottom-dollar rates. They drove down costs even more by refusing to spend money on art and other forms of marketing. This allowed them to sell music at rock-bottom prices, which has expanded classical music's traditional customer base. Interestingly, NAXOS marketed their music not as a lifestyle choice, but as great art. NAXOS has, overtime, increased its quality and production, which has allowed it to increase its catalog -- and prices.
NAXOS has also done a good job marketing to new audiences. Their digital services -- NAXOS Music Library -- has been pushed to schools and other institutions, where they can grab a new audience.
What's to learn?
1. Start by answering these questions: Is there still a need for some gatekeeper functions? Or, is there a need for creating new gatekeeper functions? Most other industries are still performing certain gatekeeper functions, but with considerably less authority. Think beat reporters and traditional library services. As counterintuitive as it sounds, people may still clamor for this work, especially when it is costly and time consuming. That's because no one else wants to do it, and in some cases, these can be needed functions. Libraries and media outlets need to lean on this authority, and make it work for them. The questions they should be asking themselves:
- Why are we doing this?
- And, who is it helping -- and how?
- Finally, you should ask What does it do for us?
2. Which means you need to think about marketing your services. If the music industry understands one thing, it's how to slice and dice an audience. But that's only half the job. You need to know their behaviors outside of your realm. To know some people prefer to crank in their car Lite Adult Contemporary more than Adult Album Alternative is one thing. But what they do with music -- any music -- the other 23 hours a day is also important. This is one area where some labels have failed. Understand the entire information environment your users are participating. If you can't know the entire stream -- which is very difficult -- understand as much as you can. And don't be afraid to change course because of what you learn.
3. Let's get back to traditional roles for a second. Ask yourself: Do we need to keep people doing our traditional work? My guess is people are still doing them whether your organization needs it or not. Library books still need to be processed; Ads still need to be sold and laid out. In what ways do these types of traditional services still benefit? How can these tasks still benefit people, even if fewer are using them? Can they be expanded? Changed? Grown? What other similar services are people looking for? The bottom line is that it may be time to have a come to Jesus meeting: Either the services can stand on their own, be expanded or be cut.
Cutting these services is, of course, easier said than done. They have the legacy effect, the importance of being a long-term task. Do not underestimate the power of repetition -- even with so-called knowledge workers.
4. Finally, get some people in your organization of work to think big picture. Allow others to move outside of the nuts and bolts of everyday tasks and dream big things. NAXOS made headlines by going against the grain. You have to understand what others are doing to see if it works for you. It's very hard to get people to stop what they're doing and look around. The questions you should be asking about any task:
- How do we do it different?
- And, more importantly: How do we do it better?
That takes understanding the environment you're working in.
Next up: What we can learn from musicians.