Nobody heard him, the dead man,
But still he lay moaning:
I was much further out than you thought
And not waving but drowning.
Poor chap, he always loved larking
And now he's dead
It must have been too cold for him his heart gave way,
They said.
Oh, no no no, it was too cold always
(Still the dead one lay moaning)
I was much too far out all my life
And not waving but drowning.
Stevie Smith, Not Waving But Drowning
The Australian record industry has experienced a constant decline for much of the last decade, and last year the sale of its plastic product fell off a proverbial cliff.
According to wholesale sales figures released last month by the Australian Recording Industry Association (ARIA), the sale of CD albums fell by 21 per cent last year alone.
This, we're told, is apparently good news but exactly how this could be a positive result is not made clear in the accompanying ARIA media release.
What is clear is that the decline of the Australian recording industry has accelerated to the point where its future can now be measured in years rather than decades.
These charts have been prepared using wholesale sales figures for units and value, extracted and compiled from statistics published by ARIA:
Despite claiming to represent more than 100 members, ARIA is predominantly a front for the four largest labels operating in Australia, namely EMI Music Australia Pty Ltd, Sony Music Entertainment (Australia) Pty Ltd, Universal Music Australia Ltd and Warner Music Australasia.
None of these four companies are listed on the Australian Stock Exchange as each is a wholly-owned subsidiary of a foreign multinational corporation.*
It's impossible to distinguish between the four major Australian labels as ARIA's figures are aggregated, but it's conceivable that Sony (due to the enormity of its back catalogue) is selling the most in the way of plastic product, but probably only at Christmas.
This could explain why ARIA failed to publish its first half figures last year, despite a bi-annual publishing model in operation since at least 2004.
(Instead, Ed St John quietly 'relinquished' his role as ARIA chair following 'his decision' to step down as President and CEO of Warner Music Australia. Enough said.)
It might also help explain the difficulty you have doubtless experienced when trying to obtain plastic product released elsewhere in the world without local distribution.
Licensing deals aren't the problem; it's that nobody still working in the rapidly emptying Sydney head offices of the 'big four' labels can be bothered keeping the Australian market up to date.
No one's buying the plastics anyway; they're not even buying digital albums. Sure, stick the single on iTunes and it'll sell, but the labels aren't making any money out of that, so who cares?
As bad as these results are, the situation is even worse than it appears on these charts.
The big four have been falling from an annual wholesale turnover of around $600 million on plastic product since as recently as 2003. Even according to their own figures, they've gone from raking in $10.75 for every CD album to a mere $1.15 for each digital track download.
(In fact, an interesting statistical adjustment ARIA quietly made last year to previously published figures for album and single downloads points to the possibility that iTunes may be paying them less than 25 cents a throw.)
Worse still, these numbers are only for Australian sales; the same phenomenon is occurring simultaneously around the world. Little wonder, then, the labels are desperately looking for someone to blame.
In the accompanying statement, ARIA chairman and Sony Music Entertainment (Australia) Chief Executive Denis Handlin described the 'illegal consumption of music' as a constant challenge, further stating the industry continues, "to work with government and ISPs to address this matter".
Really Dennis? I suppose you'd also say NATO is working with Muammar Muhammad al-Gaddafi to address the matter of his dictatorship in Libya?
In reality, the same foreign multinational corporations which own the majority of the Australian recording industry, and employ Dennis in his dual roles, are among those which have spent the last two years fighting a forlorn campaign to wrestle a favourable result out of the Australian legal system namely, Roadshow Films Pty Ltd v iiNet Limited.
So far, it's two-nil against.
After 19 days of hearings in the Federal Court, Justice Cowdroy last year told the 34 applicants in the case (see below) they had failed to even mount a legal argument:
"The law recognises no positive obligation on any person to protect the copyright of another." Neither does it, "necessitate or compel, and can never necessitate or compel, a finding...merely because it is felt that ‘something must be done’ to stop the infringements".
Instead, the judge found that the Australian Federation Against Copyright Theft (AFACT), another front organisation acting for the applicants, had unlawfully attempted to bully and bluff the respondent, internet service provider iiNet, into bullying and black-listing its customers on the applicants' behalf.
The applicants immediately appealed the judge's decision to the full bench of the federal court and lost. Last week they announced their intention to seek an opportunity to appeal their case to the High Court.
We wish them well.
In chasing the 'pirates', the industry invariably claims to be motivated by anything but self-interest. Indeed, its feigned concern about the impact of piracy on emerging artists is probably the most appalling piece of sophistry of all.
But, as the charts above demonstrate, the piracy issue is a complete red herring.
The big labels aren't losing money to 'illegal downloads'. They're bleeding cash because their business model was based on the exorbitant profits generated by forcing consumers to purchase albums full of filler songs, to which no one really wanted to listen.
Neither has digital music created piracy; plenty of people used to tape albums rather than buy them.
No, digital music has freed consumers from the monopolistic dictates of the record companies by allowing them to purchase only those tunes they want.
That's why the 34 applicant corporations have kept, and will keep, losing their big test case every time they trot out another appeal: they have no one to blame but themselves.
So what does a struggling but earnest artist do to succeed in this new environment?
Your choice is stark: continue to walk in the footsteps of the major labels on their journey towards oblivion or strike out on your own.
After a century of monopolistic control, it's little wonder the music and recording industries have become synonymous in the minds of so many artists.
But if you can imagine a future without recording labels, you can imagine a future for yourself as an artist and performer.
It's not as hard as it might sound:
- Give the consumer what they want rather than try to force them to buy what they don't: the current legal and political campaigns being run by the labels against 'pirates' and ISPs are simply extensions of their monopolistic mind set;
- Forget national and international distinctions: these are artificial constraints imposed on consumers by record companies to create further monopoly market opportunities for themselves;
- Go viral: Online personal communication technologies have freed consumers from the record companies; those same consumers now stand ready to be mobilised.
Most importantly, always bear in mind the words of Eleanor Roosevelt:
"Learn from the mistakes of others. You can't live long enough to make them all yourself."
---
The 34 applicants in Roadshow Films Pty Ltd v iiNet Limited:
1. ROADSHOW FILMS PTY LTD
2. UNIVERSAL CITY STUDIOS LLLP
3. PARAMOUNT PICTURES CORPORATION
4. WARNER BROS. ENTERTAINMENT INC.
5. DISNEY ENTERPRISES, INC.
6. COLUMBIA PICTURES INDUSTRIES, INC
7. TWENTIETH CENTURY FOX FILM CORPORATION
8. PARAMOUNT HOME ENTERTAINMENT (AUSTRALASIA) PTY LTD
9. BUENA VISTA HOME ENTERTAINMENT, INC.
10. TWENTIETH CENTURY FOX FILM CORPORATION (AUSTRALIA) PTY LIMITED
11. UNIVERSAL PICTURES (AUSTRALIA) PTY LTD
12. VILLAGE ROADSHOW FILMS (BVI) LTD
13. UNIVERSAL PICTURES INTERNATIONAL B.V
14. UNIVERSAL CITY STUDIOS PRODUCTIONS LLLP
15. RINGERIKE GMBH & CO KG
16. INTERNATIONALE FILMPRODUKTION BLACKBIRD VIERTE GMBH & CO KG
17. MDBF ZWEITE FILMGESELLSCHAFT MBH & CO KG
18. INTERNATIONALE FILMPRODUCKTION RICHTER GMBH & CO KG
19. NBC STUDIOS, INC
20. DREAMWORKS FILMS L.L.C
21. WARNER BROS INTERNATIONAL TELEVISION DISTRIBUTION INC
22. TWENTIETH CENTURY FOX HOME ENTERTAINMENT INTERNATIONAL CORPORATION
23. WARNER HOME VIDEO PTY LTD
24. PATALEX III PRODUCTIONS LIMITED
25. LONELY FILM PRODUCTIONS GMBH & CO KG
26. SONY PICTURES ANIMATION INC
27. UNIVERSAL STUDIOS INTERNATIONAL B.V.
28. SONY PICTURES HOME ENTERTAINMENT PTY LTD
29. GH ONE LLC
30. GH THREE LLC
31. BEVERLY BLVD LLC
32. WARNER BROS ENTERTAINMENT AUSTRALIA PTY LTD
33. TWENTIETH CENTURY FOX HOME ENTERTAINMENT LLC
34. SEVEN NETWORK (OPERATIONS) LTD
* EMI Music Australia Pty Ltd is part of EMI Group, acquired by Maltby Capital on 17 August 2007. Maltby Capital is owned by funds managed by Terra Firma and advised by Terra Firma Capital Partners Limited.
