p2pnet news view | P2P | Music:- Warner Music has invested a lot of time, money and effort in its Choruss licensing project, declaring it’s something the academic world simply can’t do without.

Under it, students would be expected to pay Warner $5 a month for music downloads, said p2pnet recently, continuing TechDirt`s Mike Masnick was, “one of, if not the, first to criticise it, saying the Warner Music Choruss licensing scheme amounts to a Bait-And-Switch operation”.

Jim Griffin, hired by Warner to make it happen and convince people it should, told p2pnet Masnick’s story was “factually incorrect in every respect“.

But Platinum Blue co-founder and Huffington Post contributor Mike McCready (right) believes ultimately, perception will cripple Choruss, saying people are, “increasingly done paying” if they think they’re “paying the man”.

“Given easy aternatives they won’t do it,” he says, going on »»»

Choruss must overcome that perception and I just don’t see how they can do that.

If paying is compulsory people will find workarounds. If it’s voluntary most won’t volunteer.

I understand that the major content owners need to prolong the time during which they can extract payment. Clearly, the only viable shot is to bundle the payments into other services you can’t live without but that just comes across as sneaky. So even if it is packaged with other services it will be itemized out and I can’t see that going over well.

People may want to pay artists but they do not want to pay “the man”. Again, it’s going to mainly be a problem of perception.

I respect the guys behind this initiative and I believe Jim is absolutely sincere in his thinking that this is the best solution.

I don’t have an agenda in advancing the opinion that it will fail. I am one of the few entrepreneurs in the digital music space who has never tried a business model that works in detriment to, excludes or circumvents the labels and publishers. I have no agenda in their demise.

In fact, most of what I’ve done over the last 9 years that I’ve been in the digital music space has been in an effort to help them create better efficiencies, optimize processes and marketing dollars and sell more of their product their way.

But so many of the legacy organizations stopped thinking about how to benefit their customers and instead focused on “extracting money”. A problem that contributes to the negative perception of Choruss is that it doesn’t start from the question, “How can we benefit the consumers?” It is again the question, “How can we extract the revenue that is rightly ours?”

Here’s what I believe will happen with Choruss:

1. ISPs and universities will support it because they don’t want to get sued and in some cases are interested in the learning.
2. Signed artists will support it because they want to get paid.
3. Labels will support it because they want to get paid.
4. Publishers will support it because they want to get paid

But:

1. Millions of unsigned artists will not support it. They don’t believe enough in the long tail to think it will make any difference to them and they’ve grown very resentful of “the man”. They will try to boycott it and will rail against it.
2. Millions of fans will try to boycott and rail against it. They’re done paying “the man”
3. If it ever makes it past the universities in some sort of compulsory model non music consumers will try to boycott and will lobby against it. They will say, “Why should we pay for something they don’t consume?”
4. Lots of emerging businesses will try to boycott it and will lobby against it. They will say, “This creates market friction, benefits monopolistic parties and limits our opportunity to “provide a scarce, complementary service to something that is getting ubiquitous and cheap”. Also, an increasingly larger percentage of content is not owned by companies but rather by individuals. Their content will increasingly compete with the major content owners as technology enables the individuals to increase the quality of their content and increase their ability to level the playing field for attention-getting and distribution.

Finally, even the publishers and nonperforming songwriters that today will be proponents of Choruss will shift their support as soon as business models that compensate them fairly under a new model emerge. And those will emerge. They will emerge with more difficulty if their customers feel like they’ve already paid a Choruss fee and then have to pay again under the emerging business model.

I think there are lots of ways large content owners and labels can optimize their businesses, eliminate inefficiencies and return to revenue growth. It’s so hard to understand why they don’t adopt any/many of them.

Mike adds:

“Technologies that have disrupted the space can be harnessed by the very businesses that have been disrupted without the need to be perceived as ‘extracting’ money.”

Stay tuned.

(Thanks, Mike)

Choruss licensing project – Preaching to the Choruss, March 18, 2009
p2pnet – Say No! to Choruss, says Ray Beckerman, March 20, 2009
TechDirt – Choruss` Music Tax Plan: Bait-And-Switch, March 18, 2009
actually incorrect in every respect – TechDirt Choruss story `factually incorrect`, March 19, 2009

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This entry was posted on Saturday, April 11th, 2009 at 11:57 am and is filed under Music, P2P. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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