Emusic: Just another money grab – or why the Big 4 are doomed to poor profits for years to come

This is an open challenge to Emusic, and the other members of the ‘traditional’ music industry.

Emusic’s legendary deals, great choice and open ideals are now seriously under threat by their management, the record labels and their lawyers. For many people, this may not be particularly important but in reality it represents a major shift away from their traditional roots towards some rather murky future.

I was aware of Emusic for quite some time, and finally about two years ago, I decided to try their service. On the upside, I found a lot of great jazz, electronic and classical music to listen to, and happily subscribed to the second year. On the downside, I was always a bit ‘troubled’ by their weird terms, their double charging me on the first month when I upgraded my service (hullo! I was doing you a favor? But then you took my $10.), and by frequent reports elsewhere on the net about their arrogant behavior with regard to accounts, TOS, and customer relations. Overall, I considered it a plus to be a member, and took the downloading for most of the time I was there.

The More Things Change…

Unfortunately, I logged into their website just a few days ago to find out that there were a number of obvious, and significant changes to their payments, service offerings, and TOS. Of course, to stifle the inevitable hullabaloo; they did not email anyone about the changes, despite having used email to inform users of new choices, and all sorts of trivia.

As I learned, this was true to form: squeezing their members for every last drop of cash, tweaking rules at the last minute (what’s with their 30 day/360 day year?), making it difficult to cancel accounts, … and so on. In other words, their management has increasingly tried to treat their customers like balls to be hit around the park, and not as valued parts of their business.

So what changed?

Well, pricing for a start: increases in prices have been extreme to say the least, I estimate in many cases 60+% jump in per track rates, the addition of a regionally-restricted catalogue of Sony Music (not available to me), increasing restrictions on the number of times you may download a track, to mention the most obvious.

There is still original value in their deal because they are offering legal access to mp3s, but it’s quite clear to me that they are increasingly seeing themselves in far different terms than providing an outlet for independent musicians, caring more for their audience than their shareholders, and providing a damned good service.

What am I doing?

I wrote and complained about their changes, and since discovered there are hundreds, if not thousands, of disgruntled Emusic users out there.

I was very disappointed to discover not only that I would be paying almost 100% increase in per download cost, but that I wouldn’t be able to download any of the existing catalog from Sony Records because of ‘country’ restrictions.

I had loved to use emusic up until this point, and would have swallowed the price increase just to be able to download legally many of Sony’s albums. But I RESENT paying for an upgraded service in which the only thing that has been upgraded is the price.

So, I will be looking for other legal means to enjoy music. I’m seriously frustrated with the music industry’s attempts to kill the goose that laid its golden eggs.

But then I doubt Emusic will bother to reply to this email either. BTW, where is the email informing me of the price increase? I never got it.

Their reply is below.

Thank you for contacting eMusic Customer Support.

We understand your concern and want to assure you that we truly value loyal customers like yourself and we are very grateful to you for staying with us this long. Please note we are obligated to honor licensing contracts with labels as to where we can make their music available for download. Service to customers has always been subject to territory restrictions, as explained in the Terms of Service agreement.

Current subscribers living outside the US, EU and Canada will continue to have access to eMusic, they are effectively grandfathered into the service, and will continue to be charged US plan prices with track availability subject to licensing terms for the territory of residence, just as they are today. However we will no longer accept new customers from these areas in the near future, so current customers should bear this in mind. The Sony catalog will not be available to eMusic subscribers with US service but who are living outside the US.

We really appreciate your being an eMusic subscriber and look forward to providing you with the best value in music downloads.

Sincerely, Your Friends at eMusic

I’m not particularly fussed at the legalese of record labels choosing territories to release or not. But note the black. If you live outside North America, or the EU, you may not be able to sign up for their service in future. If you continue your account, you should but…

It is clear to me that subscribers have been designated into two primary categories: those that are and will be served (US, EU, Canada) and those that will be ignored (approximately 5.2 billion people, including me). But for those who are already left as subscribers and don’t fall into either of these categories, despite being grandfathered in, you will not have access to any of the Sony Music catalogue (despite paying the same price), you will certainly not have access to any of the other big 3 labels when they join up.

Where the big boys go, the little ones will likely follow leaving grandfathered subscribers an increasingly small catalogue of music. Why? Because the TOS will be signed up by new labels and existing ones, and Emusic will go from being a GLOBAL phenomenon to a regionalized system. You will be lucky if you have anything to download in a few years at all, but of course you will still be paying because Emusic forgot to email you of the situation.

So why do music sales keep dropping?

Increasingly there are a large number of venues for listening to music online, and they are legal. But each time the music industry tries to take its pound of flesh, the flesh donors take a dive in one way or another. We’ve seen it with the Napster deal, the online Radio deals, the RIAA actions against individual consumers in North America, Emusic’s money grab, and so it goes.

The reality is that the Music industry is now undergoing fundamental changes to its entire business model; and the music companies at the top of the heap are hoping to stay ahead of the changes by cajoling, buying up, closing down or threatening the companies that pose the biggest danger to them.

It’s pretty much the same thing that happened to the Terrestrial TV channels in the 80’s, with fragmenting audiences, decreasing market share, decreasing revenue.

Similarly, the Music industry reckons the problem lies in their not owning the distribution channels for their music, and perhaps that’s true in part. Technology, however, has not just undermined the distribution end of the music business, it’s also undermined the business end, the creative end, the marketing end, … in reality, the Music Industry is now facing an existential threat to its current modus operandi, a threat that extends from an artist’s microphone to the listener’s earpiece. The distance between the two is getting MUCH shorter.

When things get this stressed, of course normal human beings get defensive and start to protect what they have built. Out come the lawyers, the defenses, the aggressive in your face ads about ‘ripping’, the price hikes, the less for more deals, the publicity, the warnings… but this is all negative energy. And great business aren’t built on negativity, they’re built on finding unbelievably great products and winning hearts and minds of customers ALL over the world. They’re built on positivity, the idea that they can change the world, even just a little bit at a time.

In my opinion, that is a challenge that the Big 4 (and now Emusic) are increasingly failing to address. They’re too busy trying to capture their audience, restrict their audience, tax their audience. Each one of these is a negative, oppressive and manipulative stance. Until they end the negativity, their music sales will stay depressed. When they end the oppression of their audience, only then will they see music sales rebound. Only then.

In the meantime, I call upon the music industry to treat their customers as real people. To treat them with respect. To treat them with sincerity. I think it’s been a while since they really did that. I’m not holding my breath, though.

So how are you reacting to the music industry’s gaffes, buffoonry, bluster and stupidity? Are you incensed? Are you shopping elsewhere? Or do you just stop buying re-releases of Celine Dion’s greatest hits? Let me know.

Author: InvestorBlogger

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