By Tess Taylor
President of NARIP

In spite of staff cuts at every major label and many independent labels over the last year we’re seeing a surprisingly strong job market. But we’re also seeing many of the same positions that were eliminated now being filled at lower salary grades. Staff cuts have made it increasingly difficult for mid- to senior level executives who have lost their jobs to find re-entry into the market at salaries commensurate to the ones they had. Cuts have also affected all the major trade publications, with some of them virtually going extinct as advertising dollars from major labels dry up. Transformation of the radio landscape has also affected the record business as concentration drives up the cost of marketing new music. Most significantly, we see a brain-drain of executive talent occurring – talent that is not resurfacing in the marketplace as many of these executives go to competitor industries.

The good news is that no matter how the industry shakes out there is an ongoing need and high demand for marketing expertise and investment capital. Online retailers are becoming more aggressive, many are seeing a steady climb in sales and there has been a welcome effort for some peer-to-peer (P2P) services to become legitimized.

But what is affecting the music industry the most, in my opinion, is the undervaluing of
music itself – now available for as low as $.49 - $.88 per song – and this is destroying an entire industry. These price points acquiesce to the demands of bootlegging and to outright theft. Our industry is taking its lead from merchants who use music to sell other things like computers, advertising, soda and iPods.

As one of the finest inventions of mankind, the music that civilization has created over centuries is all there to delight, amaze, entertain and satisfy listeners. It’s an art form with high and enduring value, and it’s a shame to see it relegated to play the low-level role of a sales-inducement so a merchant can sell you something else. Other businesses now routinely use music to sell products with little or no intrinsic value -- to draw people to a Web site, to attract consumers so they can buy mediocre or inferior products. And those – not coincidentally - are often the very same people who advocate that no one should have to pay for music as a product, and who use false First Amendment arguments to justify intellectual property theft. An underclass of otherwise lawful and honest people have been seduced by self-interest into believing that music theft is OK if you can get away with it.

Intellectual property needs to be respected. That’s the law, and it’s also the right thing ethically and morally. The copyright industries collectively have been America’s biggest export economically, but lack of respect and compensation for copyright is destroying our economy. This is not just about people you don’t know and don’t care about losing
their jobs, it has a material adverse effect on our entire economy. Theft occurs daily and we in the entertainment industry all need to be concerned because if we don’t stop it now, our business may cease to exist. And if anybody thinks this can’t apply to television programming and motion pictures, they’re wrong.

Making great music is not something everybody can do, and even if they can do it a little bit, it’s extremely hard to be successful. In every other field of endeavor, when someone succeeds, he gets the benefit of it. In the music industry, when you succeed, increasingly you get less. Now there are those who pat an artist on the back and say, “Ah, but you can always tour and sell T-shirts to make up for it.” I say this argument is rubbish!

Fortunately, some people are still prospering and there’s still money to be made. Entrepreneurism is growing and new companies are forming and staffing up. Independent labels are experiencing a resurgence and are gaining marketshare, snapping up artists dropped by major label house cleaning during downsizing. Domestic music sales are up as record companies become leaner and more focused in their marketing. Major labels are seeing increases in their digital download sales. People with ingenuity and creativity can still succeed. In spite of the press reporting mostly negative angles, there is still much opportunity, intelligence and good judgment in the record industry – and reasons to believe that the challenges we face can be overcome.

Those of us at the National Association of Record Industry Professionals (NARIP) wish to provide a platform to convey insights and perspectives on improving our business. We want record professionals and executives to get a fair shake and that the quality of their lives and contributions (as well as those of creators and those who invest in them) are respected and valued.
 

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