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Reeperbahn Campus: The geeks are here to stay – where next for the music business?

By | Published on Saturday 25 September 2010

Artists and labels need to think more about user rights, develop a more global outlook and get a geek on their team. These were the key conclusions at a debate on the impact of all things digital on the music business in 2010 at the Reeperbahn Campus in Hamburg yesterday afternoon, under the title ‘The Geeks Will Kill Creativity’.

Shying away from discussing the fight against file-sharing – except to agree that it should probably stop before the point you’re suing teenagers directly, something the German record industry has enjoyed doing in recent years – the panel quickly refuted the panel’s title, deciding that, while the geeks had certainly made things difficult for the traditional music business, if anything they’d made it more creative.

Taking part in the panel, CMU Business Editor Chris Cooke, mused: “The geeks haven’t killed creativity, but they have seriously shaken up the industry behind the musical community. In many ways this is good thing; by the late 1990s that industry had become very predictable and systematic, and was controlled by a handful of big players who new the system best. Those systems are collapsing, which makes the whole music space more exciting, and more creative. There are ever more ways to monetise music: artists and labels, large and small, just need to work out what they are”.

“There are lots of revenue streams out there for artists and labels to tap into”, Robert Britz of brand entertainment company Casino Royale agreed. “My area, branded entertainment, is one, but only one. The secret, I think, is to look at all the opportunities on the table – digital or otherwise – and work out which combination works best. And think globally. Many music companies outside the UK and US focus too much on their local market, when those opportunities I mentioned may be elsewhere in the world. And the internet, of course, makes these things easier to grasp”.

But given many of those commercial opportunities will still be based around the intellectual property that exists in music, are current copyright systems fit for purpose?

“Yes and no”, reckoned Wolfgang Schulz of the Hans-Bredow-Institut, the legal expert on the panel. “Just because the copyright system is 200 years old doesn’t mean it is totally redundant in the internet age. Does it need enhancing? Yes. And the law hasn’t been very good at this process so far, partly because in Europe were constrained by European harmonisation laws that take years to change”.

“But some interesting reforms are happening in some territories”, he continued. “And I think each country should look at what its neighbours are doing to inform any honing of their own copyright systems. Rights holders should probably also invest more time into considering other users’ rights. Copyright reforms get a bad name because they are seen to benefit the rights holders over everyone else. In the long term, those rights holders would benefit from considering what user rights should be solidified in law too – whether those users are broadcasters, digital firms or music fans”.

Legal reform will always be slow, of course, while the digital market is growing and developing fast. With so many new opportunities out there, the industry should focus on new business models more than copyright reform, the panel felt.

“For the industry the biggest challenge is sorting out the future of its new talent investment model, not reforming or strengthening copyright law, though that’s not to say such reform should be ignored completely”, Cooke said. “But the real issue is this: for all its sins, the basic record label model, where commercial organisations have a commercial incentive to invest in brand new talent – traditionally secured on sound recording rights, of course – is at its core a good system. No other creative industry has a new talent investment model that good”.

“The challenge for the industry is this: it needs a total revamp to capitalise on all the new digital opportunities we have spoken of, opportunities which can become big earners despite file-sharing. But what happens to the new talent investment system during and after that revamp? It would be a real shame if we lost it along the way. Work is already being done on overhauling the way the industry, and new talent investment, works – some of it label driven, some artist management driven – though it’s too soon to tell how it will end up”.

Any advice in the meantime? Cooke concluded: “The digital world moves fast, you need to keep up. We’ve always told new bands, get yourself a manager as soon as you can. Now, as well as the manager, get yourself a geek on your team. He won’t kill you, rather, he’ll make you more creative, and possibly more profitable”.

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