Original URL: http://www.theregister.co.uk/2005/04/11/sony_online_music/

Fiona Apple saga shows Sony's core dilemma

Disc rejected, online distribution too

By Charles Arthur

Posted in Financial News, 11th April 2005 13:48 GMT

Comment You think that record companies are all geared up for the 21st century, and that the fact that online downloads will count towards the Official Chart Countdown means that they're au fait with the online future - right? That they realise that you can make a profit by continually selling a small number of digital copies of songs, because there's no cost of replication, compared to CDs - right?

As I discovered while half-listening to an internet radio station the other day, wrong.

What grabbed my attention was a voice I hadn't heard for some years: Fiona Apple, American chanteuse best known for her 1996 debut album "Tidal" and its 59-word-titled followup "When The Pawn..." (we'll save you the rest). Noted the title of the song being played, thinking to listen to it again, as both her ripped albums lurk in my MP3 collection. But the track ("Red Red Red") wasn't there.

Odd: it can't be off her third album, because Ms Apple hasn't released one. But Google the song title, and a much more interesting story emerges. It turns out she has done a third album, titled "Extraordinary Machine", which was completed in May 2003. Recorded, produced, done, dusted. All it needed was the nod from the people at Sony for the CD presses to roll.

They didn't. The album "was quickly shelved by the sad corporate drones over at Sony because they didn't 'hear a single' and because it doesn't sound exactly like Norah Jones and because they're, well, corporate drones," wrote Mark Morford in the San Francisco Chronicle. Sony wanted something more like her earlier stuff. But she wasn't writing that stuff any more. Impasse.

Which has left Ms Apple in artistic limbo, her contract half-fulfilled and her music unheard, for 18 months. The site set up for her by Sony, at http://www.fiona-apple.com, gathers virtual dust, untouched since the launch of her second album in 1999.

Enter a group of fans of Ms Apple. First there was fionaapple.org, set up in 2002. Then, enter BitTorrent, and somehow the tracks from Extraordinary Machine began showing up here and there on the Net. Somehow again the whole CD (or the tracks off it) reached a Seattle DJ, Andrew Harms, who began playing it on his show. And then a CD-quality version appeared on BitTorrent which, according to its BitTorrent page, has been downloaded (as I write) more than 18,500 times.

OK, 18,500 sales barely registers for Sony, which wants sales in the hundreds of thousands to feel warm about an album. But that's the old thinking - that you have to sell tons of physical copies of something to make a profit.

As Chris Anderson of Wired has demonstrated with his Long Tail©™® concept, that's not true online. Amazon and iTunes sell loads of tracks which make them money even though they'd never get onto a physical store's shelves. The music business has heard of this too: Rob Wells, Universal Music's head of new media, quoted the "long tail" concept at me late last year: the iTunes Music Store, he noted, has 1.2m tracks, "and every one of them has been downloaded at least once."

So let's ask: why hasn't Sony gone for a digital-only release on Ms Apple's new album? It would save all that tedious CD pressing. Every track would get downloaded at least once. After all, the intersection of people who are mad keen Fiona Apple fans with those who are on the internet and who understand BitTorrent can't be that huge; yet it's already got 18,500 members. The intersection of people who are mad keen Fiona Apple fans and are online and have access to the iTunes Music Store or Napster or whatever must be a lot bigger. Surely there's a big profit waiting there for Sony, which might even recoup that whacking advance. Perhaps restart her multi-platinum career, who knows.

But my contacts in the music industry listened to this suggestion and pursed their lips. "Well," said our mole - who sadly we can't name; but he's been around, trust us. "It's like this. OK, so there's now no retailer standing in the way between the owner of the repertoire, which is still the record company - though that could change - and the consumer. There's no retailer acting as a middleman. If Sony owns the rights to the album, they could just put it out on the Web."

Uh-huh. So why don't they? "Because you have to ask whose interest it serves. It doesn't do much for the artist or the record company. When you release an album, there has to be a story that you tell about it for the release to make sense." You thought it was about making a profit? No, it's about what Joni Mitchell called "the star-making machinery".

And the trouble with Ms Apple's difficult third album is that it won't do what Sony wants. "They've got to be thinking that even if they do put it out only in virtual form, they're not going to sell many more of the first two albums. And taking it one stage further, when it comes to marketing repertoire online, all four major labels are much more interested in getting their huge back catalogue there that hasn't been available for years and years. Just look at what Sony and BMG have - Miles Davis, Frank Sinatra, how many albums are there of theirs? It's all about real deep catalogue."

So a picture starts to form. Ms Apple's problem isn't that Sony wouldn't everwant to put her stuff online. It's just that she should join the queue in an orderly fashion - somewhere behind all the more famous artists who recorded something in the 20th century.

But what about the fans, and the 18,500 downloads? Doesn't that indicate significant suppressed demand? "Look. Right now, online is only about 2 per cent of our business. It's still just a piss in the ocean. The whole underlying media theme for the past five years or whatever is that the record companies had their heads up their arses and ignored the online element. But actually when you add up the amount of time spent in meetings about the digital space on the subject by people at Sony and other labels in the past five years, it's ridiculous, compared to where the business was really coming from. Which is bricks and mortar stores up and down the UK."

Which leaves us where we came in, with an artist who has willing buyers, but no way to reach them; a record company that has a conduit to put the artist and buyer together, but prefers to keep them apart; and a cadre of fans who have used a technology that the US Supreme Court might declare illegal to cut out the middleman.

So nobody wins. Fiona Apple's album goes mostly unheard. Sony gets no revenues from its being downloaded. And all because the idea of selling music online has to be made to fit into the strategies used for 90-odd years. You've adapted your job and your business to this interweb thing. But the record labels still think the Net should bow to their thinking.

Oh, and there's a final irony in it all. Sony, the company at the centre of all this, should be celebrating whoever wins that case. For it's arguing on both sides. That's right. Check the dockets at this page and you'll find that one of the "petitioners" (379KB PDF) along with MGM is Sony Music.

Look further down at those "supporting respondents" (ie backing Grokster), and you'll find the Consumer Electronics Association's amicus brief (273KB PDF). And among the members of the CEA? Sony Electronics.

So you could look at it this way. If MGM wins, Fiona Apple might get her album released some time, because there'll be less "piracy" eating away the record companies' profits (assuming you buy their claims that P2P ate their breakfast, rather than their insane use of "groups" and "artists" from "talent" shows), so they'll feel safe putting tracks online.

Or if Grokster wins, then Sony Electronics can sell lots more gizmos that will store songs. Such as those you downloaded via BitTorrent from Fiona Apple's unreleased third album. It's a mess. The sort of thing you never expect to find from listening to a bit of radio. ®

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