Major US indie attacks iTunes, backs subscription

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Steve Gottlieb, (pictured) President and founder of TVT Records, the most successful indie label says.

“I started TBT 20 years ago and the rules were fair to allow me to compete.”

“I had to build from the ground up. Nine Inch Nails, KLF, Underworld, XTC. Have worked with a lot of artists, and even broken whole genres. It would not have happened without indie labels.”

“The ability to build that was because the playing field was level.”

“This past year has been the year of the indie’s. White Stripes, Concorde with Bright Eyes. Not a week goes by now without an indie breaking a big new band.”

“And it’s not because major labels can’t do payolla like they used to. It’s more that buying a Top 40 ‘hit’ act has never been a good business. Buying so-called hit records has begun to wain on its own.”

“But it’s disheartening that margins are now much titghter and competition higher.”

“The reason the music business has been savaged and imploded should be layed at the door of the major labels. They made profound mistakes in their decision to persecute Napster and to settle with MP3.”

“We settled with Napster when they said they wanted to migrate their 70m people to a legitimate platform. If it didn’t happen then people would be pushed to other free P2P platforms and that’s exactly what happened.”

“So by default MP3 became the standard. Now worse quality music has won out, despite the exact opposite being sold as the CD revolution.”

“The majors inability to grapple with technology and then settling for MP3 were major steps in the road to where we are now.”

“We continue to fight over P2P and downloading. We argue about pricing on iTunes.”

Gottlieb said that an act like 50 Cent five years ago would have pressed $21 at retail – double what it is now. The price for CDs at that time “wasn’t moving up because consumers thought it was bad. They were not price sensitive.”

“Consumers have proved they will pay $5 for a ringtone and change it a week later.”

“The price of a single on iTunes represents a 99% loss.”

“iTunes is a sham. Billions of dollars is being made by Apple, with its 500m downloads. The average iPod accounts for 25 legitimate sales. Half of that average reflects 25 over a period of years, so 12 per year. That’s not the future of the music business.”

“That is not a viable future for a business that takes years to break bands and take years of commitment to break through.”

“So that’s why I’m proud to be part of a group of Indie labels, to provide independence.”

“Consumer need to get over the fetish of ownership, which has always been a fetish. Physical CDs will always have a market, but people want all music all the time.”

“People are monetising the sales of pirated musc, and it is the tech companies that are doing it”

He said it’s clear that in a world where there are only 25m players, the worlds population is listening to free music on burnt and ripped music CDs, ripped from legitimate CDs and downloaded from P2P networks.

“Meanwhile the RIAA continues to sue consumers, not technology companies.”

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