Man. Myth. Morland.: Mommas, don't let your sons grow up to be travel agents

Now a new threat looms. The market for legally downloadable music is tiny today, but the success of Apple's iTunes online music store and the rush of rival services to the marketplace is expected to gobble up an ever-larger share of the pop music pie. A recent study by Forrester Research, which examines technology trends, predicts that in five years fully one-third of all music will be delivered through modems, and the CD itself will be passe, if not obsolete, in the years after. This isn't necessarily bad news for the record labels, but it could be lethal for brick-and-mortar stores.

"I tell retailers they need to get out of the plastic business," said Josh Bernoff, the Forrester analyst who wrote the report, titled "From Discs to Downloads." "Two-thirds of the people who currently download say that when it comes to music, it isn't important to them to hold a physical object. They're done with the CD. They just care about the songs."

If that's true, the album is doomed and the industry is headed back to its roots in the '40s and '50s, when the single was the most popular format. It's already moving that way. Last week, the punk trio Green Day released a cover of the rock classic "I Fought the Law" through a promotion advertised on the Super Bowl and available exclusively on iTunes. That's a peek at the future: Hear the song one minute, own it the next.

That's a transaction that doesn't require a record store, of course. As a precedent, consider the airline ticket. Thanks to online travel sites and the advent of ticketless travel, millions of flyers no longer think of tickets as physical objects that must be printed and brought to the airport. And that's been brutal for travel agencies: in the past three years, 30 percent of them have closed, according to Airlines Reporting Corp., which keeps tabs on the industry.

I'm going to ignore the weird use of the word "modem" to represent all data traffic for now.

Here's a, perhaps overly, simplistic take on this: stand-alone record shops, travel agents, and the like are nothing more than the bundling of an information broker with a retail seller. The core value of a travel agent is not the ability to sell the purchaser a ticket, but rather to weed out which travel plan, out of a confusing matrix of options, is the most suited to the tastes of thereof. Likewise, music stores once served as one of the main avenues of exploring and sampling all those potential musical wares.

Brokers are by definition highly specialized, and offer a service which the parties involved find too prohibitive to do themselves. In these examples, the cost involved - for instance taking the time to understand the labyrinthine pricing models of a major airline or subscribe to fifty different music publications at once - used to be sufficient to deter the average consumer, creating a market for these specialized intermediaries. But this is no longer the case.

The internet has brought the cost of almost every type of information transaction down dramatically. Automated web sites now do the work of a small team of travel agents in a thousandth of the time, at a tenth of the cost, and (some argue) even better than their human counterparts. Trusted blogs and niche sites now give tailored reviews and suggestions to music lovers of every conceivable genre. Taking out, or dramatically streamlining, the middleman results in a much better-educated consumer. In fact, I think one of the reasons music sales have purportedly dropped in recent years is that these better-informed buyers are buying a lot less crappy music and focusing on what they like.

So what of the other component, simply being a retail seller? That alone, on that scale, won't cut it. Full information transparency leads to commoditization, and that’s the bread and butter of big box retailers and online superstores - minimal margins, maximal volume.

In high school, I bought on average about a CD per week. I never liked music stores, and found the practice of browsing the aisles at once both mind-numbingly boring and overwhelming. I would therefore only enter them to purchase something with which I already had some familiarity. Despite this, what I bought often wound up being junk (Stabbing Westward?!?! I lack the vocabulary to accurately express my regret and puzzlement. And before anyone points fingers, know that I am aware of quite a few musical skeletons in various closets, and some of those closets are walk-in in size, in the basement of glass houses, so let's not get around to throwing stones, ok?).

That all changed when I went to college - my freshman year coincided with the fringe adoption of the MP3 format. Suddenly, I was browsing FTP sites and local file shares finding all this great music to listen to. My CD consumption dropped virtually to zero not because, and I want to be very clear about this, price was no longer an object when it came time to acquiring songs but because the cost of deciding what to acquire dropped so precipitously. The internet became an omnipresent listening bin costing only whatever value I placed on the time it took to rummage through it (which, being in college, was almost nil). The recommendations I was getting online, in the implicit form of scanning the collections of users with tastes similar to mine (a proto-recommendation-engine I guess) were far better than the preferred placement shelves at a record store or overpriced bloated periodicals. If these links to new tunes could also be considered a commodity, then I was receiving a much higher-quality product at a far lower price.

In fact, the cost of seeking out new music often disappeared entirely. A "friend" of mine (let's call him "Mr. Half-assed Attempt ToIdemnify III") ran a FTP site of his own where he permitted (but did not require - the community at the time was altruistic enough that leeches were rare) uploads*. It was not unusual for him to return from classes (or rather wake up from 10 hours sleep at 4pm... see also: retrospective whitewashing, guilty conscience, youthful indolence, et al.) to find an upload directory full of choice picks from kind users. The online listening station was accumulating recommendations with no effort whatsoever on his behalf.

Now it's true, if this were a perfect analogy and the capacity of all that file-sharing was solely one of suggesting new and desirable choices, that I should have, being a more broadly and deeply-informed and thus better consumer, increased my consumption as these new products were brought to my attention, the efficiency gains having allowed me to increase the accuracy of my purchases as well as stimulate demand (fuel for the fire of my rapacious quest for the soul of the muse!!!). But the service I desired - helping me to choose more wisely and bring new material to my attention - happened to be bundled inextricably with what allegedly constituted copyright theft. My attitude at the time, which is not overly dissimilar to my current stance, was one of "So be it. If certain organizations are unable to devise a plan to address this almost limitless demand, then this constitutes neither a market failure nor a legal quandary, but instead incompetence on their part." Maybe that was a bit of an over-reaction, but I still think that laws regarding this issue should be structured to strike a balance between public and private benefit (perhaps you can infer whether I think one party is getting the worse end of this deal), not tweaked ad nauseum to assure the continued viability of venerable but obsolete business models.

New models need to arise which recognize and exploit the new plentiful, ubiquitous nature of information.

* Later, this "friend" had a meeting with some authority types, discovered that asserting his rebelliousness was suddenly less important than being able to avoid explaining to his parents that he'd been expelled from their $120,000 investment in his future, and made the decision to shut down the site in compliance with a cease-and-desist order from the RIAA, the first in many incidents engendering ill will towards that organization on his part.

hey, your blog is about your opinions. it's about how you see the world. anyone can just state the facts, but it's all about how we process these facts and make our opinions. i like reading your stuff because it provides insights that, well, only you can give because... you're Morland, seer of seers, prognosticator of prognosticators.

see, that's why I turned off comments for that other entry. damn your subversive tactics!