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Is music a product or a service?
Written by: Chris Castiglione
Is music a product or a service? At the moment it is both - and I think that is where the problems lies. When a product can be transmitted as information via the web it is no longer necessary for it to embody the packaging it may have once thrived inside. In the case of music, distributing music over the web is here to stay because it is much more efficient.
This same transformation has already occurred with newspapers and hand written letters. So it would be easy to argue that music has now become an internet service similar to The NY Times Online and Gmail.
One of the side effects having content on the internet is that it can be used by others without the creator’s permission. It becomes a public good. Just like the roads we drive our cars on, it is difficult to restrict something we all have access to.
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I don’t think that the traditional definition of a service applies to music, or arts in general. The definition of service tells us that on a high level, a service is something that helps or assists someone. Sure, music helps us on a deeper level, but to classify it as such seems to cheapen it, reduce it to a level held for plumbers or electricians. Those trades offer services. Sure, there are a lot of WEB services out there today, such as the NY Times & gmail, but those aren’t what I would call artistic endeavors. When should artists charge something? Should art be free? To me, it’s worth something. Saying that touring & merchandise would make up for loss of cd sales seems to be a cop out.
further, I don’t think the average person appreciates the work that goes into creating music. Nor do they realize the cost.
“Service: A service provision is an economic activity that does not result in ownership…it is intangible” - wikipedia
Isn’t Netflix a service for movies? And the radio (FM, XM etc) a service for music? The arts certainly can coexist as a service without being cheapened.
Right now music is legally streamed - as a service - for free all over the internet on sites like seeqpod.com, myspace.com and last.fm.
@Dan - I agree that most people may not be aware of the costs that go into music. But I’d like to say that in my own defense, I used to work at a recording studio/label in New York City and I’ve spent years writing and recording music.
What’s the point of the question? NYT and GMail were always services free or not, and have no value without content(the product) of interest to its users. These services and content production have costs which are covered, at least the providers hope, by means other than direct payment by its users. Those services are free because:
1. distribution costs (storage, computers, bandwidth) are quickly approaching zero
2. users are providing something more valuable than money to the service providers(e.g. eyeballs for advertisers, data for targeted advertisement, etc.)
Music in digital form, as is all IP, has always been a public good. It’s just that, as you say, it’s really really difficult to control access to it. But it has to be paid for, and also some IP rights need to be respected for two reasons: creators need incentives to share their creations, and more importantly this sharing benefits the public good, which is why governments allowed limited monopolies on IP in the first place.
Maybe we should create download licenses. People pay for them and download all they want. I think someone figured something like $50/yr would more than support the music industry, probably pretty handsomely if the industry slims down and eliminates inefficiencies. We could create some other type of machinery to figure out how to divide the royalties amongst the creators. People could send in digital media returns(ala tax returns) or something. If you get caught downloading without the license, you could pay a nominal fine plus your license fee and move on your way. Now this opens a lot of cans of worms about privacy and enforcement amongst other things, but it’s just a thought exercise.
Netflix is a service yes, but you pay for it via a monthly fee. XM isn’t free, you pay for it. Artists recieve royalties (small ones) from ASCAP. My point is the existing model and the Free one you propose don’t do much good for the artist in the end.
The ‘Free Model’ you propose would have any artist give away their creations for free in exchange for what? Should George Lucas be paid zero for Star Wars just so he can make money from the merchandise? This is what you are pretty much proposing. Any media/data that is creative should be given away for free, in exchange for the right/obligation to make money elsewhere. ? Is this what you propose?
The artist will always be allowed to choose their preferred distribution method. I’m not suggesting that George Lucas should ‘have to give away’ his movies, rather that for some artists there are higher incentives for doing so.
And in the case of someone as established as George Lucas, he should continue to make money from box office sales (the experience), DVD Box Sets (the physical product) and merchandise (externalities). The problem comes from Hollywood and the music industry attempting to control and limit digital copies.