The State of Music Publishing

FRANK J. OTERI: O.K., let’s talk about the Web.

TOM BROIDO: The Web. My God, what a wonderful thing. I mean, we were on it, and I still have a list somewhere, I was looking for it the other day, I couldn’t find it. We went on the web in November of 1993 or 94. And I went on Lycos, shortly after we started, and I got a list, pulled down a list from Lycos, of all the WWW sites that Lycos, which is one of the search engines, knew of at that time. And there were 6898 WWW sites. And I thought, oh, my God! Under 7000. Who would have guessed? There was an Australian Botanical Society Web server, but there was almost nothing commercial. It was almost all educational institutions, and organizations, and so on. I don’t even think Sony was on the web, or if they were, they had nothing. You know, there was nothing there. If I’d known then what I know now, I would have invested in AOL and Yahoo, and I’d be a rich man. But it still is difficult and sobering, for a company the size of Theodore Presser, to think about getting involved and making a big investment on the Web, when you consider that almost nobody is making money on the Web, years in. And I heard a statistic yesterday, one of the stock people said that mutual funds should not be invested in Web stocks because of their responsibility to their investors, unless specifically that is the manifesto of the mutual fund, because 9 out of 10 Web companies will go out of business. Not be subsumed, or merged, or whatever, but will just go out of business. They will cease to exist, taking investors money with them.

FRANK J. OTERI: Well, I think what’s happened is that people are banking on the future in terms of e-commerce, and they’re banking on a future society where people order things online, and they’re creating these outlets. Amazon is still not making money, even though their name is out there. But they’re banking on the fact that 10 years from now, this is the way that people are going to buy books.

TOM BROIDO: Well, it may be the way people are going to buy books, but then, a young guy named Jaron Lanier, did you ever hear of him?

FRANK J. OTERI: He’s a composer among other things.

TOM BROIDO: He coined the term “virtual reality.” I had a discussion with him once about books and I said to him, “People still like putting this in their lap, and holding and having a shelf full.” He said that you and your generation are tied to the idea of physical books. Your children, because I told him what age my children were, he said your children may be tied to the idea of physical books, but their children won’t be. Their children are likely going to think of books in a completely different way than you do, and in fact, MIT has already come up with and is working on the idea of a flat screen that’s no thicker than a credit card, that’s segmentable, and will be able to fold into your pocket.

FRANK J. OTERI: I read the newspaper on my PalmPilot. But I also love books. I don’t see books disappearing; I’m very attached to books. But I do see more temporal printed items disappearing, like newspapers and magazines.

TOM BROIDO: Small sheet music. Not big collections of things, because binding is still a problem. But if they come up with a home bindery that is inexpensive. I mean, look, they’ve got pasta machines that you can use at home, and bread makers. We’ve become a society of people who do things for themselves at home. If they come up with a home bindery, and you know, then maybe things will go that way. The chairman and founder of Amazon says that we’re going to be a cashless society where people have a little thing that they carry around with them and they say, I want to read Moby Dick while I’m sitting in the doctor’s office, and they download Moby Dick for a day, or maybe they download for permanent, you know, storage.

FRANK J. OTERI: That’s already happening. But of course, you know, we’re skipping a step, with Amazon, people are still buying actual, old-fashioned books.

TOM BROIDO: Right. And they will continue to do so.

FRANK J. OTERI: So in terms of e-commerce and selling music, old-fashioned scores, bound scores of music over the Internet, or even having pages print out of scores that are then bound somehow, is that a way that music publishers can reach a larger audience, reach that person in Idaho who has no music shop.

TOM BROIDO: Well, it’s also dangerous because the technology has a life of its own. And technology has become something that is developed so rapidly, and legislation has become something that is so ponderous and bogged down, that the gap between what technology allows and what legislation protects has actually widened and legislation has not kept up with technology. There are technologies out in the marketplace now that give people the ability to do certain things that are not adequately protected by legislation. So it’s dangerous to use technology because you can have people using it against you. And there are people who are bent on finding ways of circumventing whatever protections are put in place to try to prevent the abuses of intellectual property, for instance. So one of the things they came up with or tried to develop was paper that wouldn’t photocopy well. And the photocopy manufacturers basically said well, we’ll develop something that will overcome that.

FRANK J. OTERI: Remember the little copy protect on videotapes that scrambles the image? Companies then made four-head VCRs that could record tapes with copy protection. Someone later figured out a way to scramble up tapes on higher level machines, and then they actually made a unit at some point that people were selling, I remember, called the descrambler, and it descrambled the protection on videotapes facilitating the tapes to be illegally copied.

TOM BROIDO: But the one thing that you can’t do, is you can’t lean against the door and say don’t come in, because technology is going to happen. But I think that governments around the world have to be much more quick and responsive to come up with legislation that enables the technology to do what it’s supposed to and to prevent it from doing what it’s not supposed to.

FRANK J. OTERI: That’s so interesting, because you know, different governments have different approaches to this, and we could go off on a tangent, but I just want to get this one thought in because you made me think of it. I used to work pretty closely with the Finnish Music Information Centre, and, of course, Finland, like all these countries in Europe, has a very different approach to radio and people’s rights. You have to pay to own a radio in Europe. You have to pay a tax every year on that radio that you own. And here radio’s free. And it’s created these problems, because it’s created a public radio system that relies on listener support, which is afraid of its listeners to some extent, and therefore, the programming takes a certain turn. Whereas, in other countries, everybody’s paying, there’s a certain revenue that goes automatically to make sure certain kinds of programming happens.

ARNOLD BROIDO: However, you have to know, that when the chips are down, Finland and the Scandinavian countries are very much of the opinion that intellectual property should be free on the net.

FRANK J. OTERI: On the net?

ARNOLD BROIDO: Yes. Digital communications should be free. The reason for it is very simple: Nokia, and the telecoms. The great struggle between the rights holders in the world going on now in Europe, on the European directive and the e-commerce directive in Europe, has to do with the fact that the telecoms and the service providers, who are very well-funded, are fighting desperately to see to it that they have free access to intellectual property. This would be disastrous for music, for books, for property.

FRANK J. OTERI: It’s so ironic, because radio is not free. And they talk about how every time any piece of music by a composer is played, there’s a royalty that’s given. Here the system is much more elaborate. You can play a recording on the radio and not have to pay. It’s all done indirectly through performance rights fees, except for operas, which have grand rights protections on them. So where do we go from here, with all of these different countries having different standards and different goals?

TOM BROIDO: Well, I think what’s required is that I think the Internet has to be harnessed internationally. I think that there have to be international standards about it.

ARNOLD BROIDO: I chair the International Confederation of Music Publishers, and we are currently working in Brussels and Strasbourg, attempting to influence the legislation. We were successful in correcting the situation the European commissions had set up when the legislation went to the European parliament, we were able to lobby and get it corrected. It went back to Brussels where they said you can’t do that to us, and put back all of the things that they’d done in the first place. Now there’s very little time, and so we’re lobbying frantically to try to keep the rights alive in digital.

FRANK J. OTERI: And of course, once you give something away for free, you can no longer charge for it.

ARNOLD BROIDO: There’s no way.

FRANK J. OTERI: That was the problem with Slate, which was a very popular Web site, and all of a sudden they charged people to go to Slate and people weren’t going to Slate anymore, and they became free again. Because people were used to this thing being free. And I think people feel weird about having to pay to enter a Web site.

ARNOLD BROIDO: Well, people feel weird about not being able to photocopy… Music belongs to us, it’s part of the sphere, it’s out there.