MUSIC BIZ INSIGHT #36

Power Reading for Busy Music Professionals

Hope you're hungry!

MUSIC BIZ INSIGHT is published for musicians, songwriters, managers, label reps, booking agents, entertainment attorneys, studio owners, music publishers, and all others involved in the music business. Its purpose is to help boost your business, find new markets, make the right connections, develop professionally, work smarter and improve your bottom line.

"As a general rule, the most successful people in life are those who have the best information." Benjamin Disraeli

Written and published bimonthly by Peter Spellman, Director of

MUSIC BUSINESS SOLUTIONS: Turning Music Business Data into Useful Knowledge.

Career-building books, articles, training, consulting and more.

P.O. Box 230266, Astor Station, Boston, MA 02123-0266, USA

Phone: 888-655-8335

Email: success@mbsolutions.com

Web site: http://www.mbsolutions.com

Please feel free to redistribute with above credit and copyright notice.

IN THIS ISSUE - MBI #36

• NEWS & VIEWS
• LAUGH IT OUT: COUNTRY SONGS THAT NEVER MADE IT
• THE BOTTOM LINE: $$$-SAVERS FOR THE SMALL BUSINESS

))) NEWS & VIEWS

EARWORMS It's a small world after all. There, now, you'll have that one branded on your brain for the rest of the day, at least. When you can't get a simple melody out of your head, it's called an "earworm," says Dr. James Kellaris, as reported by Jessica Kovler in The New York Times. The good doctor chose the word based on the German word, ohrwurm, and "says it conveys the parasitic nature of...unending tunes, which lodge too deep in the mental continuum to be easily ousted."

Who let the dogs out? We will, we will, rock you. Y.M.C.A. The lion sleeps tonight. Gimme a break, gimme a break, gimme a break of that Kit-Kat bar. The chords E and F, in that order. Petr Janata of Dartmouth University says the effect is more intense when sound is combined with motion. "When we put specific dance to the music -- like with the 'Macarena' or 'The Hustle' -- the whole body remembers the tune." The effect is also more intense among musicians, as "musical training leads to changes in brain function and structure in regions like the rostromedial prefrontal cortex." Okay, that explains it.

Take the last train to Clarksville. Some musicians admit they have taken their affliction all the way to the bank. Neil Diamond, for example, "says those repetitive notes that will not go away have spawned some of his biggest hits." Don't worry, be happy. He comments: "If I wasn't in the business of songwriting, I'd probably be seeing a doctor." I'm a pepper, you're pepper, wouldn't you like to be a pepper too? How to get rid of an earworm? "It's a familiar pattern of itching and scratching," says Dr. Kellaris. "The only way to 'scratch' a cognitive itch is to rehearse the start involuntarily, as the brain detects an incongruity or something 'exceptional' in the musical stimulus." In other words, just sing it out loud. All together nowÉ"

PHISH AND THE BUNNY Phish, the improvisational rock band, is using the Bunny, an impermanent FM radio station, to add both entertainment and information to its giant music festivals, as reported by Seth Schiesel in a New York Times article (that is nearly as long as one of Phish's shows). The article actually covers a whole range of ways in which Phish, http://www.phish.com, uses technologies "to create spectacular live concerts and phantasmagoric festival experiences that are more like computer-controlled theme parks than like the rock festivals of yesteryear." The show organizers make heavy use of walkie-talkies and wi-fi -- and, of course, both lights and sound are courtesy of some really brainy technologies.

But the main thing is that when you draw some 60,000 Phish fans to what used to be Loring Air Force Base in remote, Limestone, Maine, http://www.phish.com/it -- you've created a city, and "it's vital to have a mass communication system." So Phish leased a 100,000-watt FM station for the event. The Bunny, as the band dubbed the station, not only served up "an eclectic mix of funk, rock, jazz, folk and electronic music," but also "simultaneously broadcast Phish's live sets." Imagine that -- going to a live concert but listening to it on the radio. Perhaps most important, The Bunny kept the concert-goers informed, and dispensed important safety advice, such as "Please do not ride on top of your vehicle."

No mention of whether this station had commercials or sponsors. Hmmm. A little too busy worrying about illegal downloads, perhaps? Meanwhile, elsewhere at this event, almost 2,000 CDs were burned by fans who lined up for up to two-and-a-half hours to enter The House of Live Phish, http://www.livephish.com , "a next-generation Internet cafe," created in collaboration with Apple: "Using one of 20 iMacs, concertgoers could not only surf the Web and send e-mail, they could also burn free custom CDs from the 154 live Phish tracks that were loaded on each computer." Apple's hardware and software also were used by DJs to play music on the Bunny, although it was a "Windows laptop and Microsoft's Windows Media software" that put the station on the air. No sightings of Microsoft's legendary iLoo were reported at any time during the event, apparently.

DAVID J & EBAY He hasn't had a hit since 1989, but David J -- founder of "the influential British goth-rock group Bauhaus," http://www.bauhausmusik.com -- may have hit upon a new model for the record business, as reported by Chris Nelson in The New York Times. Unable to find a major record label willing to take a chance on his new CD, David financed its recording on his own -- by auctioning the artifacts of his stardom on eBay. He ran a total of three auctions, selling off a total of some 60 items -- "from concert set lists of handwritten lyric sheets to guitars from throughout his career."

David won't say how much he raised in total, but disclosed that the highest bid was $4,000, for the lyric sheet of one of his best-known songs, "Bella Lugosi's Dead". He also says the auction was good for his psyche. "Whatever pain was there was buffeted by the checks," he said, adding: "It was very cathartic, which I wasn't expecting."

One fan, who paid $115 for "a red silk handkerchief" used by David in a live solo performance, said his purchase was not entirely about the souvenir. "The fact that it was for the funding of the album definitely made it a lot easier to bid higher," said Kyle Burkhart, 32, of Framingham, Mass. The new record, called 'Estranged,' will be released by Heyday Records, an independent label, on September 9th (today). All of the winning bidders from the eBay auction are credited in the liner notes.

FILE-SWAPPER AMNESTY PROGRAM The Recording Industry Association of America (RIAA) will reportedly announce an amnesty program next week aimed at individuals willing to admit having downloaded and shared copyrighted music files. Those who sign the amnesty form--admitting their past activity and promising to delete copyrighted files and not to engage in future illegal file trading--would be shielded from prosecution by the RIAA (ahem...). The deal will not be available to any of the more than 1,500 people for whom the RIAA has already served subpoenas. Fred von Lohmann of the Electronic Frontier Foundation noted that because the RIAA does not represent all copyright owners, the agreement would not protect individuals from prosecution by other copyright holders. The amnesty offer, von Lohmann said, is "not the kind of agreement that most people's lawyers will embrace." (San Jose Mercury News, 5 September 2003)

AND ON THE OTHER HAND... The Electronic Frontier Foundation (EFF) has issued a statement warning users against accepting the recording industry's anticipated but unconfirmed plan to offer legal amnesty to those who admit to illegal online file sharing, cautioning that users could still face legal action. According to Wendy Seltzer, staff attorney for the EFF, "Stepping into the spotlight to admit your guilt is probably not a sensible course for most people sharing music files online, especially since the RIAA [Recording Industry Association of America] doesn't control many potential sources of lawsuits." The amnesty program is an alternate tactic the RIAA is considering to prevent illegal file sharing, pending the outcome of Congressional hearings on the subpoena provision of the Digital Millennium Copyright Act--the legal basis of the RIAA's subpoena campaign against individual file swappers (see the related story below on the RIAA's filing of 261 lawsuits)--contested by the EFF and other groups that defend privacy rights. (PCWorld, 8 September 2003)

NETOMAT "This is the artist's role," says Maciej Wisniewski, "to challenge the exiting notion of software development and distribution,"as quoted by Matthew Mirapaul in The New York Times. Mr. Wisniewski's challenge did indeed begin as a work of art, called Netomat, that "was exhibited in New York at the Postmasters Gallery in 1999 and at the Whitney Museum of American Art in 2000." At the time, Netomat was "a Web browser that retrieved multimedia search engine results and sent them drifting across a black screen. Users who put in the word 'love' were as likely to see a picture of the actress Jennifer Love Hewitt or hear a snippet of a pop song as to see the text of a Shakespearean sonnet."

Underneath it all was "a method for delivering multimedia content over the Internet"and Mr. Wisniewski sensed commercial potential. So did Alan Gershenfeld, a veteran of the videogame industry. The two men managed to round up $6 million dollars in venture capital and the result is a "communications software program" that "allows users to compose and exchange messages containing typed and handwritten text, photographs, hand-drawn graphics, simple animations, sound and other multimedia elements." Netomat is said to enable "a more personal Internet,"one in which people can be "more spontaneous,"and "scribble something on a piece of electronic paper, if you will,"as Mr. Wisniewski puts it.

The essential difference between Netomat and traditional e-mail is that "individual multimedia elements"can be combined into a single frame. Recipients can also add and delete content: "For instance, a matriarch might draw a family tree, then circulate it so branches can add photographs, correct dates or delete black sheep." Some say Netomat really isn't all that different from the "Flash-enabled greeting cards at http://www.Shockwave.com , and that the novelty of the idea evaporates quickly. In any case, a final version of the program will go on sale sometime this month, at a monthly fee of $4-$5, or an annual subscription of $25-$35. In the meantime, you can try out a beta version, for free, at: http://www.netomat.net

FOUND ART! Approximately one thousand artists and crafters are "releasing" small samples of their work "into the wild," as part of a global project "to do something positive," reports Maria Puente in USA Today. The project was initiated by Sharon Vogt of Madison, Wisconsin, about a year ago, inspired by the events of September 11, 2001. She comments: "I wasn't finding a place in the political realm to change the world, and I wanted to be FOR something rather than against."

Ms. Vogt, who is a math textbook writer -- not an artist -- scatters decorated shipping tags, finders keepers. Her kindred spirits are leaving "sculpted figures, booklets of drawings...postcards and CDs, sidewalk chalk drawings, even 'fairy houses' made by kids and tied to trees." The offerings are left "at public places such as park benches, library shelves, hospital waiting rooms, grocery bulletin boards and malls."

It's up to the finder to decide whether to keep the item, toss it, or pass it along. The project actually has few rules, other than that the messages should be positive and the artists ask permission, "so authorities don't think they're littering." On the back of each item is a web address: http://www.found-art.com , where new members can join the project, and participants can "report their adventures." Membership is said to be growing at a healthy clip, with more than 100 new people signing on each month, and "from as far away as the Phillippines."

CONSUMERS PREFER LISTENING TO SURFING, WATCHING Whether obtained through purchase or through free downloads, listening to music tops the list of U.S, consumers' favorite daily media activities. Results from a pair of 2003 Parks Associates' surveys indicate that listening to music holds the edge over PC usage, TV watching and other media consumption.

"Given that 75 percent of U.S. households now own two or more TVs, and that on average a household watches TV at least seven hours per day, there is no doubt that TV is the most frequently used media device in the home," said Michael Greeson, vice president and principal analyst for Parks Associates. "However, when consumers are asked about the most important media activity, music tops the list."

Percentages of U.S. Heads-of-Households that Find Certain Media Applications to be Important in Daily Life

Source: Parks Associates

While listening to music ranked highest among heads-of-household between the ages of 18 and 24, using the PC topped the list among heads-of-household ages 45 to 54, and watching TV finished first among heads-of-household aged 65 and older.

The proliferation of new audio technology allows music lovers a myriad of listening choices. In-Stat/MDR predicts that worldwide portable digital music player unit shipments (including solid state, hard disk drive, CD/MP3 and mini disc products) will grow from about 6.8 million in 2002 to over 36 million in 2007, with North America remaining as the dominant market for portable digital audio players through 2007.

Hard disk drive-based players are expected to have the highest growth rate, while CD/MP3 players will have the highest volumes. Roughly 22 percent of all portable CD players will incorporate MP3 technology in 2003.

The home jukebox and receiver markets are still in their infancy, and are growing at a slow rate in terms of volume. "However, the increased penetration of broadband and home networking technologies, and the ability to share content around the house will have a positive affect on this market," says Cindy Wolf, an analyst with In-Stat/MDR. Both home jukeboxes and receivers will experience their highest growth in 2004, but jukeboxes will continue to outship receivers.

In-Stat/MDR also found that the percentage of respondents owning digital audio players has increased from 15.5 percent in 2001 to 20.3 percent in 2002.

The results of a June 2003 Jupiter Research (a unit of this site's corporate parent) report indicate that listening to music via the PC is a growing trend Ñ 58 percent of online users had Real Audio, Player, or Jukebox installed on the primary home computer in 2002, representing 32 percent growth from the prior year.

TOP MUSIC SITES, JUNE 2003, U.S., AT HOME

Source: Nielsen//NetRatings

))) LAUGH IT OUT: Country Songs That Never Made It

"I Wouldn't Take You to a Dog Fight Even If I Thought You Could Win"

"My John Deere Was Breaking Your Field, While Your Dear John Was Breaking My Heart"

"I Liked You Better Before I Knew You So Well"

"I Still Miss You Baby, But My Aim's Gettin' Better"

"You May Put Me In Prison, But You Can't Keep My Face From Breaking Out"

))) THE BOTTOM LINE: $$$-SAVERS FOR THE SMALL BUSINESS

Customers buy your product or service because it solves a problem for them. The fact that your widget comes in 12 colors or 7 speeds matters less to them than the fact that it can save them time, money, or aggravation. Always strive to communicate the "benefits" of your product or service, not merely the "features". Ask yourself, "Where's their pain?" The answer will guide you in addressing your customers' real needs, and will keep your business focused on providing valuable benefits to them.

For a receipt, use certified, not registered mail. Certified costs much less. If you need insurance as well, use registered - the insurance ups the price.

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PETER SPELLMAN is Director of MUSIC BUSINESS SOLUTIONS, a business and marketing consultancy to the music industry, and Director of Career Development at Berklee College of Music, Boston. He is the author of several books for music entrepreneurs and teaches music industry courses at Northeastern University (Boston) and the University of Massachusetts (Lowell).

A musician since he was ten, Peter continues to spin riddims in the improvisational collective, Friend Planet and sing Cat Stevens' songs to his kids every night before bed.

BLOOM WHERE YOU'RE PLANTED!

Quote of the Month--

"Ah, but a man's reach should exceed his grasp, Or what's heaven for?"

--Robert Browning, 'Andrea Del Sarto'

Written and published bimonthly by Peter Spellman, Director of

MUSIC BUSINESS SOLUTIONS: Turning Music Business Data into Useful Knowledge.

Career-building books, articles, training, consulting and more.

P.O. Box 230266, Astor Station, Boston, MA 02123-0266, USA

Phone: 888-655-8335

Email: success@mbsolutions.com

Web site: http://www.mbsolutions.com

Please feel free to redistribute with above credit and copyright notice.