Southwestern’s Music Law Society and Entertainment and Sports Law Society brought to campus expert Bob Lefsetz (shown at left), who offered some blunt, candid thoughts on the future of the music industry. Lefsetz is an industry figure and author of the email newsletter and blog, The Lefsetz Letter. A graduate of Southwestern, he worked as an entertainment business attorney, majordomo of Sanctuary Music’s American division and a consultant to major record labels. He started “The Lefsetz Letter” after “getting fired” and he now writes on issues at the core of the music business: downloading, copyright protection, pricing, and the music itself. He says the industry must alter its business model to embrace rather than combat online music services. With Napster as the trailblazer, sites such as iTunes, Spotify and Kickstarter are giving major record labels a run for their money and Lefsetz stands on the side of technology.
Lefsetz offered these insights and anecdotes:
Labels and publishers as dinosaurs: He says they have done too little to change. Despite the deal with i-Tunes and Rhino Records collaborating with Spotify by putting out play lists, the resistance remains. The majors cling to an outdated model in which they control releases.
Why labels haven’t acted: Leftsetz notes that profits still are key and argues that Rhino “has gotten it right” in dealing with Spotify.com. Labels must realize that consumers will tap technology — streaming and mobile applications — because it offers them a convenient way to get a product, which is music. Labels should stop battling services and realize their technology could be profitable — and it would eliminate piracy.
DIY “Do It Yourself” artists: Technology has freed increasing numbers of artists to reach audiences on their own, bypassing labels and their efforts to retain control. Music lawyers, by pursuing this type of tech-savvy talent, could build a growing practice, if they pick acts that can grow and last. Companies like Kickstarter.com, an online funding platform for creative projects, provide a great and selective approach. Music lawyers should be picky — they should work with people that actually pay, Lefsetz notes, adding that the DIY applies to both artists and attorneys — tapping opportunities in this area requires work and energy.
Technology and music: Data can’t determine what audiences will flock to; discerning human ears are still required, Lefsetz says. Sites can find fast, early profits with filters and metrics; those aren’t long-term, sustaining ways to find chart-busting talent.
The labels’ real value: The majors, Lefsetz underscores, still have a huge leg up on everyone because of their one giant asset: their music catalogs. But having lost their monopoly over distribution, they must become more nimble and adaptive or he warns they may not survive
The industry’s future: Labels and publishers, imperiling their very future, have snubbed or attacked their business’ most important element — the fans who are their customers, Lefsetz says. Music lovers have found ways to get what they want by working around and against the established industry and have forged new, in some ways tighter bonds directly to artists.
Sell the Lefsetz Letter? Lefsetz is passionate about the quality of his content. He doesn’t want to be tied to corporations because he believes it would undercut his credibility. While other sites take on corporate backing in exchange for mass audiences and content that generates big revenues, he says “there is always a cost if you take the easy money … there is a penalty” in the quality. He’s unwilling to pay that price.