Technological blowback in the information age

In the end, of course, the record companies will look to technology to help them out.

Technological blowback in the information age.

 

Hot on the official launch of iTunes in Europe comes the news that Bertelsmann, the media giant, is to issue CDs in three different formats. There will be a cheap version that comes without any packaging, there will be a standard CD (much like the ones we have today), and there will be an expensive, deluxe CD, complete with videos and other extras. Why has action been taken? Well, in the post-Napster world recorded sales of music have fallen dramatically. Between 2000 and 2003 recorded sales dropped by over 30 per cent. Many analysts see the death of the pre-recorded CD as imminent and record companies the world over are fearful for their futures.

 

Twenty years ago everything was very different. The newly introduced CD format was already spectacularly successful. During 1990, for instance, virtually a billion CDs were sold. For record companies it was a particularly sweet success. Not only were new customers buying them – people that found vinyl too fussy – but music fans were going out and replacing all their old albums with the new, supposedly superior sounding, CDs. Whilst record companies counted their pennies, they probably didn't pay much attention to the writing of Neil Postman, who sadly died last year. Had they done so, they might not have been quite so surprised at the predicament they now find themselves in.

 

Postman, a professor at New York University, was very sceptical about new technology and wanted society to at least think before jumping in and embracing every innovation that came its way. He thought that the mad rush to take up new technologies 'creates the impression that the most serious problems we have in the world are the result of inadequate technology and insufficient information.' A favourite example of Postman's was starvation – we have enough information and technology to feed the world several times over. Creating GM crops (I don't know if Postman ever discussed GM crops, but the implications of his arguments are clear) does not actually address the cause of starvation in the world. GM crops are a way of avoiding the harsher and more fundamental realities that must be tackled if the world is to be fed.

 

If new technology was not necessarily the answer to every problem, Postman also thought that technology was thought of in too neutral terms. He thought that there was a price to be paid for any new advance, be it the TV, the computer or the CD. In part this is because technology is not additive – it does not just add something to the existing landscape, it alters it altogether. Blacksmiths didn't last long after the invention of the car, for example. Another reason to be wary of technology is the fact that the consequences of it can be both unpredictable and irreversible. An interesting example of this can be found in Regis Debray's recent book God: An Itinerary. In it Debray states that emergence of monotheistic religions only became possible once the wheel had been invented. Before the wheel each place and each tribe had its own God. Your particular God stopped working when you left your own territory. The wheel allowed for a delocalised and transcendent God to develop. On a rather more prosaic level record companies are now experiencing how unpredictable and, probably irreversible, technological change can be.

 

The CD was born in 1982 and the CD-ROM came into being three years later. CD recordable technology followed on in 1988. It was advances such as these that allowed music to become pure information. Albums can now sit on computer hard disks – they don't need to be lumps of stuff any more, they can exist as strings of 0s and 1s. The problem for record companies is that information does not obey the same laws of economics as other things do. Records and CDs are physical objects, just like diamonds and gold are. Their value is based on the laws of supply and demand. These in turn are based on scarcity. If I have a lump of gold and I hand it over to you, I no longer have it. In this case, as gold is scarce and in demand, I can charge you a great deal of money for it. But if, on the other hand, I have a piece of information and I give it to you, I still have it. Because of this, information cannot be studied purely by using traditional economic theory. If there were only one telephone in the world it would not be highly prized; it would be useless. (There was an advert recently that tried to pretend this wasn't the case – it sold its photo-taking mobile phone by saying that you should be the first amongst your friends to own one).

 

In recent years, then, we have seen the advent of file sharing over the internet. CDs, downloaded onto computers, have been swapped by millions of kids and adults the world over. Part of the reason why so many people have computers (and hence are able to swap albums online) is, ironically, in part due to the CD itself. The emergence of the CD-ROM was vital to the spread of the home computer. Without it, PCs would have been stuck with very simplistic graphics and sound systems. With a CD-ROM drive developers could create programs with sound and video clips. Along with improvements in processor speeds CD-ROMS helped create the massive growth of PC gaming. The all-singing, all-dancing, sometimes-crashing personal computers of today were helped along in their evolution by the CD.

 

We have reached a point, therefore, where the world only needs to buy one copy of each CD that is released. You could say that this was the case before with home-taping, but technology has made the process much simpler and quicker. Besides the fact that sound quality doesn't suffer either, the crucial difference is that in the information age no 'stuff' ever need change hands. Record companies in the past could have ensured, for instance, that blank tapes were very expensive; they could do the same with blank CDs now. This way, the companies could wrestle matters back into the traditional world of supply and demand economics. But, thanks to technology, no CDs or tapes are needed at all.

 

So – how can the record companies stop themselves from going under? Well, on the one hand, record companies have tried to appeal to the conscience of music fans. For the likely success of this we can turn to Postman once again. One of his most famous books was The Disappearance of Childhood (1982). In it Postman advanced the thesis that television, by erasing the boundaries of knowledge between children and adults, was making children apathetic and cynical, while at the same time infantilising adults. Postman wrote that 'the behaviour, language, attitudes and desires – even the physical appearance – of adults and children are becoming increasingly indistinguishable.' You don't need to agree wholeheartedly with his analysis, nor even think that this is bad a thing, to see signs of it. Think back to the lead up to the Iraq war, for example, when children 'played truant' in protest and adults went to work on buses and tubes reading the latest Harry Potter book. The advent of the internet has allowed those boundaries of knowledge to narrow even further. Kids can find out in a moment how much a pre-recorded CD actually costs. They can type Bertelsmann into their computer and read about the story of the 2002 CD price fixing case involving the company.

 

I think we can be pretty certain that appealing to the conscience of music fans won't work. Will Bertelsmann's plan work? That's highly unlikely too and even the company itself isn't sure. The decline of pre-recorded CD sales probably is irreversible. In the end, of course, the record companies will look to technology to help them out. Technology can provide new revenue streams (ringtones, for example) and, as iTunes has shown, technology will always be profitable for some. It is perhaps not surprising that most of the major record companies have signed up to it; most of their albums can now be legally downloaded from it. But they are still out of control – music fans are quite at liberty just to download the tracks that they like. There is no need for them to buy albums anymore. To save themselves (and maybe to save the very idea of the album itself) record companies might have to look at ways of controlling downloads so that songs cannot be bought individually. To enforce such a thing, and to stamp out the illegal sharing of music information, technological innovations will be required. No one can know for sure where such innovations will lead to, but it is certain that there will be winners and losers.

 

Words: Chris Dawson