Though it was originally instituted for the protection of the distributors of media, copyright has come to be regarded primarily as protection for creators. Knowing that the internet is forcing the old channels of distribution into obsolescence, the old distribution industries no longer try to justify copyright laws by recourse to their original purpose. They would have us believe instead that without copyright laws, actors, musicians, and writers could not make a decent living.
No doubt this is true for a few artists in the case of music, but copyright is hardly a windfall for artists in the current regime. Royalties from media sales account for a very miniscule portion of the average artists’ income.
So whose interests do copyrights serve? Certainly not those of the average artist signed to a major label, who in most cases does not even own the copyright to his work. Given recording and production costs, only the most successful artists will ever see any profit from media sales. The money for everyone else is in concerts and merchandise – naturally saleable items.
Why, then, would an artist sign to a record label? In the past they have functioned as middlemen, bearing risk and internalizing search and transaction costs in the absence of suitable technology. They fronted the large amounts of capital necessary to make a recording, press it, distribute it, and market it. They negotiated for scarce shelf space in retail stores and for playtime on the radio. They were the artist’s voice to the world.
But that was a world without the infrastructure and technology we have now. Where before you had to invest large amounts of money before you could even think about producing music, the returns to investment diminish much more quickly now: anyone with a computer and a microphone can self-produce music of a reasonable quality. This simply was not possible in the world which gave birth to the record label. The barriers to entry in media production are practically nonexistent now that we can record, mix, and master, all on an affordable computer. And not only production has been democratized, but distribution as well. The internet, especially with services like Bandcamp, allows artists to self-distribute without any physical overhead..
As the amount of capital necessary to produce good quality media declines, a multitude of smaller, more competitive record labels are able to spring up (and indeed have sprung up), allowing the artist to outsource things which he may not have expertise in, such as production or album art. At the same time, internet broadcasting has obviated the need for vast investments in broadcast towers, clearing the way for a multitude of smaller, online radio stations who negotiate directly with smaller artists and labels, filling niche markets which could never have been filled by airwave radio. As storefront distribution fades into irrelevance, so does that advantage of a major label. In fact, the only irreplaceable service of the major record labels is sheer marketing muscle.
This was the business model of the labels: invest in a few big acts, simply because the cost was so prohibitive. So when costs came down, rather than downsizing and investing in vast numbers of new artists, they expanded their artist roster a bit, and shoveled the savings into marketing. Modern pop acts are, and have always been, little more than marketing muscle and a pretty face.
Perhaps this was acceptable twenty years ago when it would have been infeasible for artists to self-publish. After all, what else would we have done? But there is no excuse for its continuance through the advent of the digital age. Yet it persists. The question must then be asked: why do major record labels still exist at their size? The answer is simple: copyrights.
Copyrights and intellectual property protections, as discussed earlier, are a windfall primarily for the distributors of media. This secures for the larger among them vast income streams, which are then funneled right back into marketing more pop culture monoliths. Indeed, the niche markets served by new radio stations are a threat to the dominance of the monoliths. The major record labels have been trying to stifle smaller radio stations by mandating exorbitant royalty payments for radio play, in order to secure the market for a cartel of monolithic radio stations, which would no doubt play only the monolithic acts.
Exactly the same problem exists in the movie and television industries. The major studios build their business on investing huge amounts of capital in monolithic blockbusters. As the barriers to entry continue to fall, the money is invested into marketing. This gives us, like in the music industry, a small number of actors with exorbitant salaries and near universal recognition.
This is not what culture should be: copyright has become a blight upon culture itself. By enforcing distributors’ claims on culture, we do not incentivize the creation of culture; we stifle it and homogenize it. Consumers have fewer choices in a world where copyrights are owned by a company whose only irreplaceable service is raw marketing muscle.