Richard Barry: "IT's Like This..."
Published: 04 Dec 1998 16:26 GMT
We all love to hate IBM. It's big and awkward, some might say it doesn't know how to execute a decent plan... look at OS2. But the Big Blue is now working on a secret project that could affect the way we pay for our music. Richard Barry hopes it doesn't mess up.
Ask IBM what the Madison project is and you'll be put through to corporate communications in the US who'll politely tell you that the company ‘has nothing to report'.
Nothing to report means ‘we're working on something that's really pretty cool, with some very touchy partners, who by the way, are quite prepared to litigate in order to protect their interests. Oh and by the way if we pull it off, it could change the way the entire world listens to and pays for music'.
A hell of a mouthful for one of the world's clumsiest IT firms and so, for the time being, everything you hear about Madison is based on pure speculation.
The project was first mentioned in the UK by Music Week a month or so after Alan McGee - who brought us Oasis - pissed off the entire music industry with an article in NME predicting the demise of high street retailers at the virtual claws of the Net.
McGee's technology vision wasn't bad for a music meister- if you like a tune, get online, download it and pay the artist direct. On paper it sounds great. Everyone wins; the consumer gets cheaper music because there's no middle man and the artist assumes total control over his/her creation. Only problem with this scenario is there's no marketing guru sitting in the middle soaking up a percentage to pay for the new Ferrari.
Harsh? Not so.
The middle men in the music industry exert an iron grip on the performers and they're not about to lighten up just because the Internet phenomenon is making life a little tricky. Concerted efforts are being made behind closed doors to come up with a distribution model that keeps up with modern trends and ensures the fat cheques continue to satiate the middle man's appetite for fast cars and fashionable labels.
IBM's secrecy may keep us guessing precise details but an announcement is not far away according to sources in the music industry who believe the Big Blue may finally earn itself some street cred. by its association with the industry's heavyweights - that's Sony, Warner, EMI and Universal.
A reported $20m (£12m) has been injected into Madison, to stem the flow of revenue that began seeping out of the industry when the MP3 format was born. As MP3 geeks logged onto the Net those well dressed muzos went into a quiet panic. Quiet because they couldn't be seen to be panicking. They had always been fairly adept at dealing with pirates, why should they be worried about this new generation?
But the MP3 posse isn't simply a new generation of pirate, it's a whole new breed. More intelligent, far more cunning and infinitely better connected. "They literally had no clue how to deal with either MP3 or any of the other formats that have come along since" says one source who doesn't want to be named. "MP3 came along and all of a sudden people could get albums off the Web without paying anyone."
And there's the problem.
Like it or not, aspiring Michael Jackson's have, in the main, little or no knowledge of MP3 and very little business competence. For them to set up a Web site that distributes music and collect payments for that music securely is highly improbable, even laughable.
The pouting artist readying herself for a career singing ballads on MTV isn't interested in building a secure web shop to sell her wares. That's the middle mans' job.
In an article in last week's FT it was suggested that the music companies are looking to ‘bypass retailers' to increase profits with Madison.
This is unlikely.
The issue here isn't that people are just threatening the music companies. With enough piracy the artists themselves would be effected because there would be nothing in the pot to promote them. No tours, no TV specials and most important of all, no album sleeves. It's all very well having a copy of the latest Madonna album but people want all the goodies that go with it. Collectable sleeves and CD covers. Coloured vinyls, and limited edition freebies. It's part of the magic and it's what retailers do best.
Madison is important. Without it the consumer could allow his inherent gluttony for free stuff to cripple the music industry. We'd be left with a hotch potch of second rate artists all vying for space on an increasingly difficult to navigate Internet.
I for one hope IBM gets this right. The end result will undoubtedly be a more direct method of getting music to the consumer which in turn will mean less cost. We'll still have the middleman, but his days of charging extortionate fees are over, or as our source said: "The Gods have finally had their temple rumbled. Everyone knew change was coming and now the Internet is forcing the most radical change in music delivery this planet has ever seen. I don't think the Net will kill off the industry, but it will force it to adapt and sharpen its focus, so in the end the consumer will benefit and that's not a bad thing, is it?"
Take me to the MP3 debate.
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