Tech rocks: using the Internet, the vocal Chuck D and the legendary Nile Rodgers are once again shaking up the music industry. (Technology).
Both artists are banking on the success of their online ventures: Chuck (photo above right) heads up Rapstation.com and SlamJamz.com, and Nile launched the Nile Rodgers MP3 Dance Club (www.mp3danceclub.com) last year. Their companies use MP3 (Motion Picture Experts Group, audio layer three) file-sharing technology, a format used for compressing audio to transmit as files at near-CD quality over the Internet. Everyday millions of people upload, download, and share MP3 files, but most big record labels have not embraced the technology for fear of Napster-like situations--the widespread distribution of copyrighted materials without the company's (of the artist's) consent. Granted, the labels do have a point. At its height, Napster had more than 1.5 million users distributing nearly 3 billion MP3 files without paying for any of it. And there are many other sites like Napster waiting in the wings. But while neither Chuck nor Nile advocate piracy, they don't view file sharing as a negative. Rather, they see it as a way for artists to control the distribution of their work and put more of those dollars in their own pockets, not those of their labels. So, yes, Chuck and Nile see things differently.
Why take on the music industry? The son of political activists, Chuck says he remembers the impact that his parents' ideals had on him. "[They] inspired me to be independent and always go against the grain if the grain was not helpful to the whole cause." Known for his candid, if not bold, statements, Chuck is quick to add, "I don't go against the grain for the grain's sake. I go against the grain because I see right now there may be a BLACK ENTERPRISE magazine where you're encouraging people to go into the market and to have control. The reality is that big business smashes that foundation."
When Public Enemy parted ways with their label, Def Jam, in 1999 after disputes about digital distribution (Public Enemy was the first major group to release an album online--1998's There's a Poison Going On), Chuck decided it was time to take charge. He is an outspoken advocate of the artist's right to release music online, independent of the label, thereby retaining control of his of her career.
"One of the most frustrating things about big business [is] the cost of marketing and promoting hip-hop and rap music through the traditional venues like radio and television. The cost factor could run as much as seven figures," says Chuck, "[and] the only ones that could afford to market of promote the traditional venues were the five major labels [that] could all sneeze at a million dollars going down the drain." Chuck now uses his Websites as his distribution channel as well as for promoting new and existing talent. RapStation.com boasts approximately 250,000 visitors per month and has more than 100,000 members.
Chuck anticipates that sites like SlamJamz.com will form a third tier to the music industry, a tier that includes and embraces the black artist. "When it comes down to us black folks and our knowledge of this business, which has been around for a hundred years, the majority of us are clueless, [yet] we are some of the biggest consumers. What I am trying to do is get people to stop thinking only as consumers and get into the participation as a manufacturer and [into] the production of it."
Members at SlamJamz.com can purchase credits and then download new music: 30 credits ($5), 50 credits ($8), and 100 credits ($10). Some songs a re free; others cost approximately one to three credits. Then the user "owns" the tracks. Once members have signed up and downloaded the tracks, manipulation, such as re-mixing, is encouraged. In fact, Chuck regularly releases his music to the public to remix and holds contests to determine the best mixes. "It's a perfect service area," he adds. "Anyone can go to the site and pull a mix down, and anyone can remix a song from anywhere on the planet to be pulled down as a legitimate remix."
A FORTUNATE ACCIDENT
While it's easy to see how Chuck became involved in the merger of technology, politics, and music, it's not that obvious with Nile. The New York City native candidly admits that he got into the online game almost by accident--he sits on the board of directors for a software company called Visiosonic, which produces PCDJ players that allow professional and "wannabe" DJs to mix music. "It's really kind of silly," Nile laughs. "Remember the Reese's Peanut Butter Cup commercial? One guy had a chocolate bar and the other guy had a jar of peanut butter, and they tan into each other. One day, the CEO [of Visiosonic] and I were sitting around just sort of brainstorming and realized that our two respective entities would marry quite well together."
Tackling a new venture is old hat to the acclaimed jazz guitarist, who has had his hand in a variety of projects over the years. Nile's uncle taught him the art of orchestration while he was just a teenager. Later in his career he cofounded Chic, produced multiplatinum albums for David Bowie, Madonna, and the B-52s, and always maintained a strong interest in electronic music technology and experimenting with it.
It made sense, then, that Nile and Visiosonic would be a perfect fit. PCDJ.com is one of the Net's most popular entertainment portals for the dance and mix culture, and more than 5 million PCDJ players have been downloaded since 1999 when the company launched it. The free PCDJ player is ad supported and currently serves more than 2.6 million advertising impressions a day. At MP3DanceClub.com members can download and mix tracks the same way they would if they had records on a turntable once they download the PCDJ player.
Nile saw that Visiosonic had the technical resources to help answer an age-old question: How do you market new music to the public? This is where Nile echoes Chuck D's sentiments: "It's very, very simple. The truth of the matter is that, in today's world, you have to look at alternative methods of marketing because the old-fashioned methods are all controlled by people who have big pockets."
MP3 Dance Club provides a solution. "It takes advantage of a community that is growing by leaps and bounds and services their needs," says Nile of the mounting interest in online file sharing. "It has instilled a new reality in us: If the music is safe, if it's cheap, and if it's convenient, we don't mind checking it out. It's the way that radio used to be. Radio was the safe and convenient and inexpensive thing that you turned on, and if you heard something you liked, you'd go buy it."
MP3 Dance Club has taken the exact model of radio, providing users with a community of like-minded individuals. "Napster has proven that this method works. Everybody talks about the big famous people whose music has been shared through Napster--and shared will be a kind word--but the truth is that there is lots of undiscovered talent that, because of the community that Napster has built, is experiencing not only growth but a certain amount of excitement," argues Nile.
With more than 2 million users, the basic revenue stream of MP3 Dance Club is as follows: If you buy the music at a retail establishment, the price point is incredibly low, about one-third of what a normal CD costs.
"And because it's new music, stuff you may not have heard on the radio, you're risking six of seven bucks but you're getting 14 or so songs in regular redbook form (regular CD form) and in the MP3 format as well," explains Nile. "Some files are just the vocals, some are bonus mixes. And you get the PCDJ software that lets you mix the songs just like a DJ would." All of these products are considered "freeware" since the consumer is technically buying them at retail outlets, but there is some form of royalty that has to be paid to the artist. "When you get the product online, the revenue streams are very interesting. As a download, our business is up to $2 a download," says Nile.
Additionally, consumers get the tracks separated from the vocals, enabling prospective DJs to mix and match and do whatever they want with the music. Also, the artist who created the music can make money if their music is used. "In that scenario, though, I don't make any money," says Nile.
To an extent, the artist determines the overall price point. Nile says he has always wondered why a record costs, say, $20. "I go to a store to buy blue jeans and if I buy them at the Gap they cost one thing, and if I buy them at Versace they may cost another. They're all fundamentally the same thing, but they have different price points because of the different things that I find valuable."
He says the music industry adheres to the same standards. "A brand new Madonna album costs the same as a brand new Janet Jackson album. It doesn't make any difference except that they're on two different labels. It doesn't make any difference that I may not mind paying more, artistically, for a Madonna album than a Janet Jackson album because of the added value of what I think a Madonna record is," he says. "To a consumer it could almost look like price fixing on a certain level. There is no reasoning for it and no justification, necessarily. I don't get it."
Since Nile is asking the consumer to take a chance on an artist he or she may not have heard, he decided that his service would have to offer perks to go along with the music, and because it's online, it would have to be inexpensive. "We do know one thing after analyzing our customers--they love free things. But just because a business gives us something for free, that doesn't make them a viable partner. It's all about the quality of their product and how much we think our fan base will like and use the product."
And because his name is on the marquee, so to speak, Nile says he feels strongly about the product. He decides which new artists are put on the site. "Hopefully, because I've proven to the world at large that some of the stuff that I like, you like too, maybe I could be your filter. That way people can respond and tell me how I'm doing. And it doesn't cost that much."
WHERE DO WE GO FROM HERE?
While it is unlikely that Chuck and Nile will single-handedly take down a billion dollar music industry, they are trying, nevertheless, to change the way the public gets their music, one download at a time. And although Chuck sees this as an exciting time for artists, the journey is not without its frustrations, particularly when it comes to getting venture capital. "Black business, when it comes down to radio stations and record companies, have been obliterated by some white guy sitting behind a desk who has absolutely no concern for our existence," he explains.
It is often this discontent that fuels him. "I try to encourage the community I come from, [and get them to understand] that we can control, to a certain degree, what we create. [The Internet] is the most significant transition that the music business has ever gone through, because it's all about the transition of how music is created and also distributed."
RELATED ARTICLE: A New Music Order
Chuck D's Websites, Rapstation.com and SlamJaz.com, allow music lovers to tap into a wide range of undiscovered talent--and get the music they want at the right price. In addition to music, Rapstation.com has an online store featuring the latest gear and the Swapmeet, where you can trade music and views. At SlamJamz.com, members can use their credits to download music--for free and for a fee--and create their own mixes.
RELATED ARTICLE: Music Your Way
Nile Rogers' MP3 Dance Club (www.mp3danceclub.com) lets everyone from the professional DJ to the amateur and "wannabe" access a broad selection of music that's a fraction of the cost of that in music stores. Additionally, the site exposes up-and-coming as well as known acts to a wide range of music lovers--more than 2 million users have logged on and used MP3 Dance Club since Nile Rodgers launched the site last summer. And more than 5 million own the PCDJ software that lets users mix their own tracks to create infinite music combinations.
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|Article Type:||Industry Overview|
|Date:||Jul 1, 2002|
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