American Express-SavingsTerry McBride, CEO of the Nettwerk Music Group, which manages such best-selling acts as Avril Lavigne, Barenaked Ladies and Dido, told the CES conference today that the music industry needs to "let go it's control and let consumers own their music" in order to survive.
The industry, McBride says, has been "hitting a glass ceiling" in terms of sales. It won't grow beyond that, he says, until the industry gets rid of Digital Rights Management and drastically drops the price of downloads.
"I believe there is a tipping point where price will compete with free," he said. "Right now our metric of measurement is iTunes at 99c [per track], but that represents only ten per cent of the marketplace. The other ninety per cent of the marketplace is [downloading music] free."
"I would say then have to say that the value of a song is not 99c but more like 10c," he said. "Imagine if we were to drop the price to 25c and capture 50 per cent of marketplace? With music and movies, the perception is that the cost is too high. It needs to come down."
The music industry needs to let go of control, he said, because "the concept of copyright law only exists to the music industry, not to the consumer."
McBride has good reason to believe that a loosening of controls can boost record sales. One of the bands his company manages, Barenaked Ladies, was signed to major label Warner for the release of six albums until 2003. Offered a "multi, multi-million dollar cheque" to re-sign with the label to produce more music through traditional channels, the band opted instead to go it alone and try a few alternative means of distributing music.
Barenaked Ladies now record every single concert they perform and allow fans to purchase the recorded tracks on a USB stick or via download within minutes of the concert ending. They even offer downloads of the band's studio bed tracks (individual multi-track recordings of each instrument) to those fans that might want to remix tracks or create mixes with instruments left out to jam along to.
The decision, McBride says, "paid off handsomely." Last year was the band's second biggest ever from a financial standpoint.
"They have made the same amount of money as they would have if they sold five million albums," he said. "The music industry has a real issue with control," he said. "All the band needed to do is let go of that control."
But that was precisely the atmosphere in Las Vegas tonight as he both opened this year's CES conference and closed a final chapter of his career.
Thousands of journalists and technologists queued for some four hours in snake-like lines that wound around several floors of the Venetian Hotel and Casino to hear him give his tenth and final CES keynote.
In just under six months, Gates will retire from full-time work with the software company to devote his time and energy to his philanthropic project The Bill and Melinda Gates Foundation, which aims for global equity in healthcare and education. As several Microsoft devotees said during the long wait to see the show, Gates' last CES keynote is a significant event. This was the man that revolutionised desktop computing and in the process influenced the career opportunities for millions of IT support workers around the globe. And for the very dedicated few among the 140,000 people in Las Vegas for this year's CES, it is likely to be the last time they will see him talk.
Gates isn't a dazzling stage-performer by any stretch. His squeak of a voice has nothing of the immediacy or intensity of some of his peers (Cisco's Chambers comes to mind), and he hardly appears the rock n' roll type with his daggy blue sweater and slacks.
Microsoft Chairman Bill Gates adrresses CES 2008
(Credit: CES)Thankfully there were plenty of stars at hand to liven up the event.
Early in the address, Gates was treated to a pre-recorded tongue-in-cheek send-off that included appearances by presidential candidates Hillary Clinton and Barack Obama, former vice president Al Gore, U2's Bono, Hollywood director Steven Spielberg and actor George Clooney, all joking at Gates' expense as to what he might get up to upon retirement.
Among the frivolity, there was the business. Gates discussed the next "digital decade" as being one in which high definition content will be pushed to all manner of devices. He then touted the further development of the natural/human user interface - making an example of Microsoft's touch-based 'Surface' Table Computer, but not mentioning the Nintendo Wii or the Apple iPhone, both pioneers in the field.
Gates predicted that PCs will again grow this year at double digit growth rates, and announced that Microsoft's latest Vista operating system now has some 100 million users. He also announced that broadcaster NBC will be offering some 3,000 hours of footage from the Beijing Olympic Games online using Microsoft's Silverlight and Live software technologies.
In gaming, Gates' colleagues announced that the company has shipped some 17.7 million X-Box games consoles, claiming that more cash is spent on XBox games than games for both Nintendo Wii and Sony Playstation put together.
The company also showcased new innovations in the digital home and for the portable music player Zune and demonstrated ways in which Microsoft technology can be used to improve the communications and entertainment experience while driving in a car.
There would be no major product announcements, nor any emotional farewell.
Instead his keynote closed, as perhaps the long wait to see Gates speak deserved, with some real rock n' roll royalty - a live Guitar Hero jam-off with Guns N Roses guitarist Slash.
Microsoft Chairman Bill Gates summons Slash for a Guitar Hero duel
(Credit: CES)Then Gates, unassumingly, walked off the CES stage for the last time.
- prev
- 1
- next
