The Numbers Behind the Copyright Math

There is a fundamental shift in the underlying business models. (Thank goodness)

a) No longer is the only source of getting a song, buying an album. Now, if you like a song, you buy the song for 1.29, rather than the album for $20 from HMV or wherever.
b) Social media and word of mouth trumps advertising and corporate presentation. It's much harder to convince your audience to spend the $20 for the album with 1 mediocre song, and it's much easier for your audience to talk amongst them selves and realize that the album isn't worth it.

c) Thanks to the digital age, the industry is shrinking. Same for newspapers.

A large portion of the size of the industry was the overhead necessary to distribute physical media. I'm not sure what %, but I'm certain it was significant. This business value is gone and/or going now. What you're left with is the value of the purely creative side, some marketing, some overhead.

If the value of a newspaper in 1990 was $100M, and $60M of that could be attributed to the capital & overhead required to actually produce and deliver the newspaper; now it's 2012, and after inflation the same company finds itself worth $40M because they've lost the need to maintain the infrastructure to do the physical delivery. The same is true for Music (tho not yet for movies, although coming) A very large portion of the value of a music distribution company was the distribution part. That's gone now, thank goodness.

We just need the industry to adapt to the new mode where creation is harder than delivery, because right now I feel like we're not being served well by record company A&R.

But that's just me

Source: http://rss.slashdot.org/~r/Slashdot/slashdotScience/~3/YtrVfooiFiA/the-numbers-behind-the-copyright-math

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