Somewhere along the way, record companies figured out
that it’s a lot more profitable to control the distribution
system than it is to nurture artists. And since the
companies didn’t have any real competition, artists had no
other place to go. Record companies controlled the promotion
and marketing; only they had the ability to get lots of
radio play, and get records into all the big chain store.
That power put them above both the artists and the audience.
They own the plantation.
Being the gatekeeper was the most profitable place to be,
but now we’re in a world half without gates. The Internet
allows artists to communicate directly with their audiences;
we don’t have to depend solely on an inefficient system
where the record company promotes our records to radio,
press or retail and then sits back and hopes fans find out
about our music.
Record companies don’t understand the intimacy between
artists and their fans. They put records on the radio and
buy some advertising and hope for the best. Digital
distribution gives everyone worldwide, instant access to
And filters are replacing gatekeepers. In a world where
we can get anything we want, whenever we want it, how does a
company create value? By filtering. In a world without
friction, the only friction people value is editing. A
filter is valuable when it understands the needs of both
artists and the public. New companies should be conduits
between musicians and their fans.
Right now the only way you can get music is by shelling
out $17. In a world where music costs a nickel, an artist
can “sell” 100 million copies instead of just a million.
The present system keeps artists from finding an audience
because it has too many artificial scarcities: limited radio
promotion, limited bin space in stores and a limited number
of spots on the record company roster.
The digital world has no scarcities. There are countless
ways to reach an audience. Radio is no longer the only place
to hear a new song. And tiny mall record stores aren’t the
only place to buy a new CD.