Monday, August 21, 2006

Another Step Down for the RIAA?

The main reason I'm very anti-RIAA is that, in their misguided attempts to shore up their obsolete business model, they are fighting for legistation that will run up the general cost of electronics and have other adverse, unforeseen legal effects. (The DMCA is their worst exhibit to date, but look out for their "broadcast flag" and "analog hole" laws.) I won't bore you with my other reasons.

But I am pleased to tell you about a problem I think the RIAA will face in a few years. The RIAA represents most of the major music publishers, and these publishers represent the bands whose music Apple sells to its iPod users. Apple gives a large cut of that $.99 per song to the publishers (I hope some of that gets back to the musicians). I think that from Apple's point of view, the publishers are just a middleman nuisance that owns access to the bands. Pretty soon I expect Apple to start signing up musicians on its own and cutting out the RIAA publishers. Apple can afford, I think, the investment to grow a few hit bands.

Microsoft will be competing with Apple, in the unlikely event that their anticipated "Zune" really competes wih iPods. Both companies will like the idea of cutting csts by eliminating the music publisher middlemen. Between this battle and the development of open source music, the RIAA's influence will inevitbly weaken. I hope.

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