Jason Harrow: Day 1: What’s the value of a song? Zero.

Reposted from JUST ENRICHMENT

I took in a pretty full day of panels at Day 1 of the Rethink Music conference (my preview post from last night is here). While tomorrow’s lineup promises lots of great stuff on copyright law and policy, today’s schedule was pretty business-oriented. As such, I’ll hold off my explicitly legal analysis until tomorrow night. For now, I want to answer a question that was asked at pretty much every panel: what’s the value of a song in today’s online environment?

The short answer: zero. A single song is worthless — but that’s not a bad thing. Let me explain.

There was much consternation among the audience and many of the panelists — specifically, the ones who work for the large institutional players in the music industry — that there is an entire generation that doesn’t understand the “value” of pieces of recorded music. They lamented that music has been chopped up into $.99 individual songs, $9.99 digital albums, or, even worse, subscription services like MOG that offer on-demand access to large libraries of music — though with many unfortunate limitations, as explained below — for $10 a month. Referring to these service, one audience member asked in dismay: “does that mean that a song is now worth 1/100th of a cent?”

Well, no: actually, it’s worth less than that. I’m happy to report that in 2011, individual songs have become worthless to me and many in my generation. That’s because pretty much every song is available anywhere, any time, for free, either streaming on YouTube or Grooveshark, or for unauthorized download on a filesharing site — indeed, most songs are available in all three places.

But it doesn’t follow from this that no one will pay for recorded music online; far from it. I can’t know for sure, but I believe that the true value of recorded music lies in abundance, and I believe that people will pay for abundance. Indeed, abundance is why I pay for unlimited high-speed Internet access. I don’t place any value on individual tweets, or individual photos I upload to Facebook, or searches for hotels for a possible trip to Toronto. Instead, because those things are free, I swim in a sea of tweets and photos and travel searches, and I leave it to those sites to monetize my abundant usage. To use another example that is admittedly somewhat different from the case of music, I don’t really know what value I place on a rerun of Seinfeld on TBS, or a new Colbert Report on Comedy Central, or an episode of Mad Men on AMC. I suppose in theory there is a value, but no one thinks of things that way. What we really value about cable is abundant access to oceans of content — most of it bad, some of it great — and that’s why we pay for cable and DVRs that let us watch as much of it as we want, whenever we’re in the mood.

Back to music in 2011. I place a very high value on abundant access to downloadable, freely transferable music, that I can play however I want, whenever I want, in whatever software I want, on whatever device I want. That is because I value abundance, and, unlike video, I value the freedom to consume music in ways that I want, not in many of the overly restrictive ways that record companies want. I would pay a lot of money for that, but no one yet offers it. Services like MOG, which require users to stream from proprietary software either online or on portable devices, and don’t allow direct downloads of any MP3s, are so close yet so far. MOG is interesting, and the founder clearly knows what he’s doing and has good ideas, but this service does not yet offer what people like me value (I don’t just mean this figuratively; I did the free trial, and decided not to become a subscriber). I value being able to play my music library in iTunes, or to set a song to a slideshow of my pictures, or to play it in my iPhone’s terrific native music player, and, though I’m not a professional musician, I also value being able to occasionally edit the songs for personal, fair uses. MOG lets me do none of these. It’s objectively true that, nearly 12 years after Napster’s introduction, illegal filesharing sites still offer the best online product there is: they combine the unrestricted uses of mp3s sold on iTunes or Amazon with the attitude of abundant access that MOG has. Make that combination legal, show me where to send my monthly fee, and I’ll be the first to sign-up — and I don’t think I’d be the only one.

There was some discussion at one of the afternoon panels about why the current generation of all-you-can-eat, on-demand services like MOG have not really taken off yet. It seems to me that the reason this has not happened is not a failure of marketing nor of “consumer education,” one of the day’s favorite phrases. It is because they do not yet fit perfectly with what consumers value. When that finally happens, I have a feeling the services that provide what I describe above will be quite popular with not just consumers but also with artists — because artists will finally reap the benefits of the public happily paying to be a part of the remarkable abundance of recorded music that so many have worked so hard and long to produce.