Must pop eat itself?

According to the virtual reality pioneer Jaron Lanier, the trajectory of Web 2.0 is leading us towards an economic conundrum. In a nutshell: the moment, at the start of the 1990s, when western democracies sought to forge an IP-based ‘knowledge economy’ coincided with the rise of an ‘open source’ digital ideology that viewed copyright as an impediment to the free flow of information.

The result, he writes, is a Catch 22: ‘On the one hand we want to avoid physical work and instead benefit from intellectual property. On the other hand, we’re undermining intellectual property so that information can roam around for nothing, or more precisely as bait for advertisements.

That’s a formula that leaves no way for our nation to earn a living in the long term.’

Certainly, these sentiments would win some sympathy from those who make their living through music. Over the past decade, the marketplace for music has evolved dramatically. Fifteen years ago, music relied upon a handful of retail and marketing channels. A Top Of The Pops appearance was worth its weight in gold. In the digital age there are now hundreds, if not thousands, of ways to market. The last Beyoncé album was sliced and diced into over 260 formats – from CDs to downloads and ringtones.

The world is complex. There is no one ‘business model’. What works for one artist, is wholly inappropriate for another. For those at the creative sharp end, the impact has been profound. In recent years, many artists have instigated innovative and tailor-made digital campaigns. (Radiohead’s In Rainbows was the first high-profile album in a decade not to ‘leak’ before release.)

Implications for younger acts are no less significant. There is a huge opportunity to innovate. As well as chasing radio plays, gigs and magazine features, new artists are – by default – wielding digital tools such as Twitter, Facebook, SoundCloud, YouTube and MySpace to build their profile. The results are frequently astonishing, although competition for attention has never been so fierce.

Frankly, I don’t think there’s ever been a more exciting time to be making music. However, there are some fundamentals that the internet will not change.

First and foremost: musicians need to eat. And creative individuals, who strive to make a living from their craft, will always require investment. In 2010, that investment is still, typically, going to come from a label, a publisher or a manager. In essence, this finance and expertise defines what ‘the music business’ is.

It remains a pivotal role, and one with wider significance. Music is entertainment, but is not just entertainment. It is a cultural and economic asset. And, crucially, music is a primary fuel for the digital economy – creating value and attracting users to all manner of services, networks and devices. Music, great music, draws a crowd – whether that’s to a field in Glastonbury or over a social network.

It is vital that this function is fully understood. For, just as artists have always relied on technology, technology is reliant on the production and investment in high-quality content. Our long-term futures are interlinked.

Over the past ten years, there is little doubt that this equilibrium has been disrupted, and not just for music – similar challenges are vexing newspaper proprietors, publishing houses, games developers and anyone else whose intellectual property can be compressed into a digital file.

But we must all strive to unlock the conundrum that Lanier describes. It is not the responsibility of one party to reform itself and locate that elusive ‘business model’. For the future of the UK economy, we all have to: and together.

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