MP3 or Bust

“Apple”:http://www.apple.com/ yesterday announced a brand new music service that attempts to bridge the gap between Mac users and the record industry. We all know about “Napster”:http://www.napster.com/ and the Napster like services that have depleted the record industries profits in the last few years. We all know, because we’ve all tried them out. We all downloaded that Men at Work song we were too embarrassed to buy.

We all tried it out, because getting anything for free is the coolest thing ever, but then record companies got all upset because they said we were “stealing” the “Land Downunder” song and were ripping off the artists who needed the capital.

The Record companies went to their lawyers, the lawyers went to the government, the government said it was illegal, and Napster was eventually shut down. The record companies were, for the time being were happy, but just like a weed – the next week a dozen more “file trading services” sprung up and took Napster’s place. The record companies tried encrypting songs on the CDs to dissuade users from converting them into MP3s which enraged music fans.

Why?

Because music, contrary to popular belief, is owned by the music artist and the fan alike. Without the fan the artist is nothing and without the artist the fan has nothing to listen to. Songs become part of you. That Otis Redding song you and your wife love is yours, you even call it “our song”. No one can tell you what you can or can’t do with it. When you try to download it to your computer to use in a DVD about your wedding and it not only crashes your computer, but refuses to play at all, how are you going to feel? Cheated? Upset? Angry?

Where’s the solution?

The record companies in their ignorance, never asked the fans, the people listening to the music, what they wanted. Instead they pissed them off and tried to turn off their free music. The listeners immediately saw the record companies as the enemy and music sharing exploded. It became hip to use Napster and send the music industry that we were in charge. The fans wanted to bypass the record companies and support “the artists”. Unfortunately, in the world of mega-conglomerate-corporate-labels-America the artists could never promote, or distribute their music without the help of the Record labels. Which was evident when no recording artist, aside from Wilco, bypassed their record company or spoke out against them.

This is where the problem lays.

Where did the Record companies go wrong? Well, a whole lot of places really.

* The biggest error was that the record companies never fully realized that digital distribution of music was the future not a passing fad.
* They lost sight of the needs of their end market and treated them like criminals instead of treating them like frustrated music fans.
* They forgot that what makes people listen to music.
* They attacked fans and accused fans of committing crimes.
* Instead of creating special online only material, they created gimmicky DVD special editions of CDs which soon were criticized by fans for their low quality.
* They came up with no better alternatives and instead played catchup by releasing their own pay-for-music MP3 services and radio stations, which couldn’t compete with free MP3 services.

Where Apple’s service differs

Apple’s music service is touted as a music store, not a service. You buy the music, you download it, you own it. They do put restrictions on how many computers you can transfer files to, but deliberately don’t put encryption on their files which they rationalize as “If you want to thwart copyright you will and no amount of encryption will prevent it.” They have very specially positioned themselves between the record companies and the fans, not as the music company’s representative.

Apple have also moved away form the MP3 file format in favor of the much more robust and industry standard AAC (part of the MPEG 4 file format). This allows apple to offer audio that is “virtually indistinguishable from the original uncompressed audio source.” They have gone beyond competing with MP3 to surpassing it, which is very important for them to do to keep this service alive. No one can compete with free, no mater how illegal you make it, but you offer a better product at a cost people might decide to make the switch.

The new “AAC file format”:http://www.apple.com/mpeg4/ is amazing, at 128kbs it is truly indistinguishable from the original (and trust me, I wasted hours re-encoding “Yankee Hotel Foxtrot” to find differences). You don’t get washed out highs as you do with MP3 and there is a depth that AAC has that MP3 doesn’t have at 128kbs or at 160kbs. There is no watery crash symbols in AAC. No chirps or birps like downloaded MP3s. Plus added bonus, it takes less time encoding AAC files than MP3s.

Ultimately Apples new service appeals to Apple’s user base which are control freaks and would re-encode their entire music collection in AAC to get the fidelity enhancement. The service is still lacking some key features that will bridge the gap between music fans and record labels like a larger music selection (it only has 200,000 songs at the moment and is missing alternative music labels like Matador). Apple also needs more dynamic pricing, $.99 a song and $9.99 an album is still a little too high for most fans to allow for a huge migration over to the pay service. However, the Apple service feels right and is placed correctly in the market. Apple has consumer confidence, which would have killed a company like Microsoft doing the same type of service. I think Apple will make bigger waves than anyone in the press is predicting, I think Apple’s Music Store will be profitable and keep fans happy and will satisfy the bastards over at the record companies too.

UPDATE For more Information about Apple’s new Music service check out “This Fortune article”:http://www.fortune.com/fortune/technology/articles/0,15114,447333,00.html and this “New York Times Article.”:http://www.nytimes.com/2003/05/01/technology/circuits/01stat.html

Now get out into the beautiful weather!

Budding tree in prospect park

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