I apparently had better things to do this weekend than hear the latest self-righteous, all music is free, the Web changes the fabric of reality post about the music business, this time from Michael Arrington of Techcrunch. The title is intended to get a rise out of people. (”These Crazy Musicians Still Think They Should Get Paid For Recorded Music.” Uh … thanks?) But tracking through links, I came upon this quote:

Recorded music is nothing but marketing material to drive awareness of an artist. Websites that bring that music to listeners are doing artists a favor. In fact, they’re doing them a favor that they should (and will) be paid for.

Now, regular readers know CDM is all about new business models for music, all about ditching DRM, not at all about archaic royalty schemes. And certainly I can’t think of a good argument for the prompt for Arrington’s piece, which was that Billy Bragg thinks artists are owed money retroactively by a site to which they’ve already uploaded their own music.

Here’s my answer to that:

Recorded music has value to consumers.

There are two phenomena right now on the Interweb. One: access to self-distribution (for artists and small labels) means artmakers can explore new models for the business that supports their work. Two: an open market for ideas (the blogosphere, namely) means if you can come up with some pithy something or other, you can achieve overnight fame. Of course, the former is considerably tougher than the latter. And don’t make that idea too complicated or nuanced, because you’ll lose the link-happy bloggers impatient for you to help topple the conventional Record Industry.

Latest case in point: Kevin Kelly posits the notion of 1,000 True Fans as the magic number you need to support yourself as an artist:

I think Hank Shocklee’s contribution to Public Enemy, as a producer and co-founder, had a deep influence on the approach to sampled sound and digital sound ever since. In Brisbane, Australia in December, I got to sit in a room full of students at the Art of Record Production conference and listen to Shocklee walk through the album "Fear of a Black Planet." I realized it was a bit like needle-dropping Sgt. Pepper with George Martin.

Shocklee describes his role with Public Enemy as a kind of teacher, helping Chuck D, poet, meet digital production technology. In the years since, he’s expanded that teaching role to include young people around the world, and he’s got some strong opinions about the importance of learning the craft of recording and music in general.

Fittingly, we sat down for a few moments in a classroom.

Interview: Hank Shocklee, Pt. I - On music making from cdm tv on Vimeo.

What a lot of people may not know about Hank Shocklee is that beyond being a Public Enemy veteran, he’s also been deeply involved in the music industry. Unlike so many armchair industry quarterbacks, Shocklee has worked with the major artists (from Madonna to Peter Gabriel) and had a significant stint as Senior Vice President for Universal MCA Records. That means when Shocklee criticizes the industry as musically illiterate, he speaks from the perspective of someone who’s been on both the inside and outside of the majors. (He’s now producing and scoring music independently, and drove his entrepreneurial spirit into his own Shocklee Entertainment.)

Criticizing is one thing — but Shocklee had advice for how artists can guide the direction of their own career. He talks about the limitations of the industry, how the music community can grow beyond it, and how visual media could finally become a serious domain for musicians. (We agree with that.)

Interview: Hank Shocklee, Pt. II - On music business from cdm tv on Vimeo.

Universal CEO Doug Morris makes an easy target for the blogosphere. This is the old-school record industry executive who called iPod owners thieves and wanted broad legal enforcement against piracy — enforcement that, in the end, seems to pale in comparison to the revenue generated by actually offering online sales. So, now that Morris has gone up against Wired, the blogosphere can easily see him as a dinosaur.

Universal’s CEO Once Called iPod Users Thieves. Now He’s Giving Songs Away. [Wired News]

But as artists, all of us face a fundamental problem: how do you put value on something that’s ephemeral? It’s an age-old issue that has faced musicians explaining to their parents why they don’t want a real job, and artists to their patrons when affixing a price tag. (And as we’ve seen from veteran software developers and the BanPiracy debate, software “artists” face the same challenge.) Sure, people love to talk piracy, because it’s easier to talk in those terms. Piracy is theft, theft is crime, and crime is bad — including making a mix tape for a friend. Or all music should be free, and never mind that artists need health insurance and rent money. They’re black and white extremes, entirely couched in moral/philosophical terms, neither of which contend with how to solve the actual real-world problem (at least, not if you stop there).

And then I came across this quote from Morris in the interview:

“Really, an album that someone worked on for two years — is that worth only $9, $10, when people pay two bucks for coffee in Starbucks?” Morris sighs. “People never really understand what’s happening to the artists … If you had Coca-Cola coming through the faucet in your kitchen, how much would you be willing to pay for Coca-Cola? There you go,” he says. “That’s what happened to the record business.”

Wait a minute… a liquid that comes out of your faucet for free, but is also sold, in bottles, at retail. How much would you be willing to pay? Hmmm… this sounds familiar.

It’s called water.

And how much are people willing to pay for the privilege of packaging, control over subtle variations of taste, and mobility? Quite a lot, as it happens. More than Coke.

Several readers have observed this quite eloquently, but let’s summarize: laws around music are complicated, messy, and confusing. If they don’t seem that way to you, you’re either a lawyer or you haven’t done your homework. That said, without question, proposed changes to streaming music licensing fees would be devastating to Internet radio, because not just top 40 music requires license fees — even many indie labels are RIAA members and participate in SoundExchange. But here’s the key: they’d be devastating as proposed. And suddenly, at the eleventh hour, SoundExchange seems to be backpedaling. (Their strategy, evidently: push as hard as possible until the last conceivable moment, then find a deal that works for them — while they retain the upper hand at the bargaining table. Surprise, surprise.)

If you want to hear more about the eMusic saga from the company itself, they’ve started a new blog called 17 dots. (For more, see their defense to Ars Technica. Their argument remains simple: people want to pay less for music. Sales are declining; eMusic is the cure. Hypebot has some terrific coverage of the saga of label departures and what it might mean for eMusic. The short story, though eMusic says the departures are amicable, is that a few key labels have left (Victory, Ultra Indie), others are thought to be on the way out (Red House, Silva America, Tzadik), and others are rumored to be leaving. There’s really not a max exodus yet, as some reports might have you believe; the issue seems to be that labels are unhappy at the (distant) #2 online music store.

There are far better people than me to analyze sales data, and if you’ve seen anything intelligent, please send it along. But I think the most important question for musicians to ask is what the underlying trends mean. And there are quite a few unanswered questions about sales in general. You can read the record industry’s market data at the RIAA site. Here’s what I notice people haven’t been asking:

Why talk about the “decline” of music sales while ignoring online sales growth?