Windowing Music – Helping Artists Monetise Music

The sales of CDs and records has been falling for years. When iTunes arrived and online sales of music took off; for a brief period of time it seemed as if a messiah had arrived who would put an end to the troubles of the music industry. It was not to be.

The troubles for the music industry began with the increasing penetration of internet. It has nothing to do with how the distribution took place. Around the mid 80’s music started going digital. By the mid 90’s it was truly digital. More music was being distributed on CDs rather than on tapes or records. The real trouble for the music industry began when copying became possible.

Vinyl records could not be copied. Cassette tapes could be, but involved a lot of work. I remember having to spend hours playing each cassette that needed to be copied. At times it was just not worth it. CDs made copying a lot easier. I could be done with copying a CD in a matter of minutes and the quality was  also as good as the original. I am from the Tape Cassette generation and I used to have to go to my friends place and get the Cassette or CD from him and record or rip at home. I was constrained by the distance that I could travel and the fact that all this consumed time.

The geographical constraints and time constraints diminished the injury that copying caused to the industry.

Internet changed all of that. The internet made the distribution of the ripped content easy. I could suddenly send across a song that I loved to a friend as a attachment on e-mail. Unintentionally, I was killing the music industry. When a music file was available for free, there was no further reason to buy it.

The dial up internet was constrained for speed. It made distribution of large number of songs still quite difficult. Every year after 2000, internet speeds have been gradually rising up. As the internet speeds increased, sharing larger and larger files became ever easier and piracy became the way to go. When I can get music easily for free, why should I bother paying for it? Then came along torrents (peer to peer sharing) taking internet distribution to a ‘Pro’ level. Today, it is possible to get the entire discography of any artist on any torrent site. The entire exercise of finding the torrent and downloading the file would take less than 10 minutes.

Streaming is one format that got around the problem of downloading by not permitting the users to download the song at all. Songs, Spotify, Pandora, Beats and many other are taking varied approach to allow listeners to consume music. The issue with this format is that it does not have the strength to generate revenues the way downloading does. So the content gets consumed millions of times at a fraction of the revenue that downloads generate. Artists have been getting paltry cheques from the streaming companies and it does not make any sense to support this format.

For a solution the Music Industry needs to look at the Film Industry. They are also content creators whose content is equally susceptible to piracy and hurt by the advent of the internet. You can just as easily find any movie on any torrent site. Why is it that the Film Industry does not seem to be in a state of turmoil?

The Film Industry uses this thing called ‘Windowing’.

A movie makes its money from various ‘Windows’. The first window is the Box Office, then the Cable Rights and then finally the rights to Internet and CD distribution. By the time the box office is done, the producers have recovered the production cost along with a sizeable profit, so the monetary losses that they take due to the copying and piracy of the digital format is not as hurtful to them.

The Music industry needs to come up with a format that allows them to rapidly monetise the initial buzz and excitement surrounding the release of their songs. They must not immediately make it available in digital format for everyone to download. It should be controlled through a Window that does not allow for easy copying. The moment digital content is downloaded, its as good as free. (Even Walter Issacson’s recent book ‘The Innovators’ is not available in e-book format).

Taylor Swift recently pulled her music from streaming site Spotify and netted a neat $12 Million in sales, causing a stir. I feel streaming is unfair to the artists, but letting people download is no better. Agreed, it allows for cash to flow in but the music is copied as quickly as well.

One possible format could use an event based release for the songs, where the musicians have control over the channel of release and listeners pay per use. Once the initial 6 months are monetised through such a channel, the next step can be to allow downloads before finally allowing streaming to take place. The essence of success is to delay the inevitable availability of the content in digital format. That is the best way to ensure that the content would be paid for and the artists can monetise the content that they have worked on.