Real World Free-Music Assumptions

Cayocosta

If it can be established that the free-music doctrine (FMD) is sufficiently profitable:

The labels are not going away; for even if they did, they'd be replaced by other entities that do the same things - for artists will always need capital, professional expertise and support; and there will always be investors and service providers for anything that is profitable.

As such, no matter what these entities might be called, they would - collectively - closely resemble traditional record companies; therefore, labels (or their equivalents) will still exist in a profitable free-music system.

Regarding non-label "spec" deals: it would appear this service would continue, but now recouped via alternate sources of revenue (including possibly, publishing) in addition to any funds derived via music sales and/or downloading - the same multiple sources labels must tap.

"Points" allocations will similarly diversify in application.

However, if the FMD is not profitable:

Then it's going to be a tragedy for everyone: the labels will go down, investment will dry up, and music will devolve into a preponderance of crap recorded in basements and bedrooms. The music "industry" will be over.

The issue of profitability:

Like today; under the FMD, music is only profitable if an artist's fans (and/or advertising sponsors) will pay enough for his or her services to not only cover all associated costs, but to also provide a surplus revenue sufficient to render the endeavor worthwhile.

Therefore, all that is essentially happening under the FMD is that costs normally recouped via music sales (less any advertising revenue offset) must now be absorbed by the artist and/or record company's alternate revenue streams.

Consequently, the prices of whatever goods and or services these costs are applied to, may increase; which raises the issue of market forces - increase in price decreases demand - hence, a potential zero-sum situation may emerge: greater profit from fewer sales equals less profit from greater sales.

Rather than fully underwritten via price increases, it may be safe to assume (in light of the above) that the bulk of the net-cost of the FMD would be absorbed by the artist and/or label.

Thus, it would appear that the overall profitability for both artist and label will be reduced; and it follows that all costs would thereby be cut to as little as possible by all parties - especially at the onset of the FMD's realization.