This belongs in the Gear forum because 50% of being a musician (or any endeavor) is knowing business. It is a long read, but damn well worth it. I included the links to the "History Repeats Itself: How The RIAA Is Like 17th Century French Button-Makers"
This is my latest post in the ongoing series of posts about economics when scarcity is removed from certain items. Two weeks ago, in my post about the 17th century button makers and how they were quite like the RIAA in many ways got plenty of attention, and that kicked off a fun discussion. Many people (phew) saw the connection, but a few did not, and claimed that the situations were entirely different. The button makers, they claimed, were trying to stop anyone else from making buttons, while the RIAA has no problem with anyone else making music. Of course, this ignores the specific similarities (crying out for government help to defend a business model, treating customers like criminals, wanting to invade people's private homes, etc.) that were pointed out in the post -- but more importantly, it highlights one of the biggest problems that many who are in industries threatened by disappearing scarcity face: they don't actually understand the market they're in.
It's interesting to note that it wasn't horse-drawn carriage makers who became successful automobile companies. No, they ended up going out of business, because they too narrowly defined their markets as being the horse-drawn carriage market, rather than the road-based transportation market, or just the transportation market. Of course, that was something the railroad businesses could have claimed as well -- but they also were too narrowly focused on being in the railroad business (and, some say, were the inspiration behind passing certain anti-automobile laws early on in the automobile's history). The horse-drawn carriage makers, however, very much should have realized they were in the transportation market, and should have been always looking for ways to step up to provide better and better systems for local transportation. People weren't buying horse-drawn carriages because they were horse-drawn carriages, but because they could use them to more easily get somewhere. Thus, when automobiles hit the scene, the smart horse-drawn carriage maker wouldn't have looked at it as a threat, but as an opportunity to provide a better transportation system to his customers. But, that only works if he correctly defined the market.
In the case of the RIAA, contrary to the complaints in that button-maker post, they are not actually "making music." The musicians make the music, and the RIAA hardly represents the musicians. The RIAA is the "recording industry" and they represent the interests of the record labels who, while ...
Read the full article -> http://www.techdirt.com/articles/20070125/004949.shtml
History Repeats Itself: How The RIAA Is Like 17th Century French Button-Makers -> http://www.techdirt.com/articles/20070110/004225.shtml
It is a few years old, but a great reread.
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