THE LEFSETZ LETTER: The Revolution

Let's be clear. These are the BEST of times for music and musicians. The stranglehold of big radio and big labels has been broken. AND

THEY DON'T LIKE IT!

The majors' power comes from a monopoly on physical distribution.
But physical distribution's days are history. And anybody can purvey their wares alongside that of the majors' online. Furthermore, you

don't even have to employ the majors' business model. You can give the music away for FREE! You NEVER have to charge for it. You never

have to play live. You don't have to play by any of the majors'
rules AT ALL!

But don't you want to get on the radio?


Bob Lefsetz, Santa Monica-based industry legend, is the author of the e-mail newsletter, "The Lefsetz Letter". Famous for being beholden to no one, and speaking the truth, Lefsetz addresses the issues that are at the core of the music business: downloading, copy protection, pricing and the music itself.

His intense brilliance captivates readers from Steven Tyler to Rick Nielsen to Bryan Adams to Quincy Jones to music business honchos like Michael Rapino, Randy Phillips, Don Ienner, Cliff Burnstein, Irving Azoff and Tom Freston.

Never boring, always entertaining, Mr. Lefsetz's insights are fueled by his stint as an entertainment business attorney, majordomo of Sanctuary Music's American division and consultancies to major labels.

Bob has been a weekly contributor to CelebrityAccess and Encore since 2001, and we plan many more years of partnership with him. While we here at CelebrityAccess and Encore do not necessarily agree with all of Bob's opinions, we are proud to help share them with you.

The people making the music, who are rejecting the majors' game, DON'T LISTEN TO TERRESTRIAL RADIO! Why would they want their music

alongside Britney's and that of the other posers? It would be DEVALUED! They don't listen to the radio and neither do their FANS!

But what about TV? You want to be on TV, don't you?

No. TV shortens acts' careers. Sure, major labels can still find people who want instant fame. But more acts see that Pearl Jam is the

only band broken on MTV that still has its bona fides and a career intact, and they won't go on the boob tube.

Our money. You want our money.

Some do. But that cash comes at a price. And that price IS EVER GROWING! You don't only don't want to pay royalties, you want a piece of

touring, merch, all 360 degrees of revenue. And when it's all said and done, YOU still own the record, even though sales paid for it. This

is a business proposition? Maybe acts will take it when there's no other game in town. But those days are through.

The majors' game is based on control. And a narrow sphere of availability. Neither of which is in existence anymore.

So, we're living in an era of chaos. Not only is the future incomprehensible, SO IS THE PRESENT! But it won't last forever. But those

making change are not those who WERE in power. Because they're not willing to take chances, not willing to INNOVATE! (Read Seth Godin for

edification: http://sethgodin.typepad.com/seths–blog/
2007/10/radiohead-and-t.html)

The majors made music free, not the public. Napster offered to pay.
So many people offered to pay. Even Verizon. But the labels wouldn't take the money. They wanted to protect Best Buy and Wal- Mart, who

have got NO LOYALTY TO THEM! (Meanwhile, they continually screwed the indie retailers.) They wanted the CD economic model. In an era where

people buy iPods capable of holding thousands of tracks, computer hard drives have the capability of holding TENS OF THOUSANDS OF TRACKS! To

deny this reality is to try and get everybody to do their word processing on IBM Selectrics!

The future is here. The only ones not embracing it are the old wave players.

Songwriters… Don't bitch at the public stealing your wares, scream at the labels who wouldn't embrace new business models. Who turned

down every innovation the Silicon Valleyites came up with.

Oh sure, it wasn't this simple. Napster wanted to make money too.
But it was clear the labels had to do SOMETHING…but what did they do? NOTHING!

They killed Napster. They killed Kazaa. Today they killed Oink.
Did ANY of these efforts increase legitimate sales? NO! A failed strategy, wouldn't you say?

So what do the labels do? As delineated above, ask YOU, the MUSICIAN, for a bigger piece of the pie. FOR WHAT?

The majors are out of touch. Music is no longer about videos, but the live experience. That's why concert tickets cost so much. You'd

think labels would invest in touring acts. But they're too hard to break. Can't anyone give the labels a break?

WHATEVER you do, don't give the labels a break. They just want to put a drag on the future, control you, milk more money before the

inevitable decline occurs. Then again, the decline has been going on for almost a DECADE and now it's getting worse and they're doing

NOTHING! Oh, they're suing Usenet. Usenet was more popular back in 2000. Hadn't they heard of it then? Why didn't they sue it THEN?
Could it be that those plotting strategy are too busy going to lunch and playing golf to be net-savvy?

Yes, the future is controlled by those familiar with keyboards and mice, not radio payoffs. If you make the music, align yourself with new,

honest businessmen. With transparent accounting. Who love your MUSIC! Fans…keep acquiring the music the way you want to consume it.

That's the ONLY WAY change will happen. The labels don't want to lead, they follow at best. A buck a track is ridiculous. Ten bucks a

month from EVERYBODY is a better business model. But the labels will only allow this if they've got CONTROL, if it's a RENTAL MODEL!

There IS NO CONTROL! Face it! The genie can't be put back in the bottle. Deal with reality old farts.

The field is wide open for young entrepreneurs. Who'll control the filter, what to listen to, as radio continues to falter, and will control

sales, when music is paid for once again.

Revolutions don't happen without revolt. The public has been revolting since 2000. And those in power have continued to sit in Versailles.

The beheading has begun. CD sales will sink even further after Christmas. Did you see Apple's numbers? Once you get an iPod, you don't

WANT a CD!

What do the majors say to this? Apple is the ENEMY!

Apple is not the enemy. People love their iPods more than they love your labels. Because iPods enrich their lives. That hasn't been the

label's mantra for decades. It's about theft, about rip-off. The public's moved on. Time to chase people, play by their rules, because

they're NEVER COMING BACK TO YOU!

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