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Open Channel: Welcome to the Middle Ages

They say those who ignore history are doomed to repeat it. Craig Anderton finds an analogy for -- and about -- the ages in this look at where the music industry may be headed.

Craig Anderton
Craig Anderton

If you want to know where the record industry is heading, climb into the wayback machine, set the controls for the 10th century, and check out where feudal systems came from—but more importantly to us, how they ended up.

The similarities are striking. Before feudal times, there were powerful kings and emperors, with names like King RCA Records and Emperor Polygram. They ruled their kingdoms and expanded their territories by conquering smaller kingdoms, like Lord MCA. In fact, some would say they expanded too much, and a combination of overexpansion and corruption led to the downfall of their empires. Invading hordes from the land of MP3 hastened that downfall by plundering the kingdom’s riches and giving their spoils away for free.

Without powerful kings and emperors, “government” became fractured and localized. Those living under the local lords could still stream—I mean, own—pieces of property. But that ownership was always constrained by the local lord’s rules.

(By the way, lest you think this will become a “dump-on-the-streaming services” rant, it won’t. Never before could musicians get their music into the world so easily, nor do they have to deal with the “container charges” or prohibitive studio time costs deducted from their royalties. Also, the accounting for today’s streams doesn’t allow stashing records in a warehouse, then selling them off-ledger as “returns.” And the public has never had it so good—almost anything made since the history of recording is available.)

Anyway, back to our analogy.

Feudalism’s Beginning

When the traditional music industry began unraveling in the late ’90s, it became more feudal in nature. Historians have never agreed on a precise definition of feudalism, but here’s the gist.

The lords held land from the king, in return for tribute—kind of like Lord Virtual Storefront paying tribute to King Amazon. Meanwhile, the peasants (that’s you and me, folks) lived on the lord’s land and got protection in return for homage, labor and a share of what was produced.

In our case, we peasants live on the land of Lord Streaming Services, who holds that land by the grace of King Internet Servers. We set up our little streaming shops, provide the labor to promote our music, suck energy from the servers, and the lords get tribute from the music. We peasants also receive the protection of the lords, who pay to keep the servers running.

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Basically, we all have our own fiefdoms these days. Ultimately, feudalism created localized groups of communities with narrow loyalties—not unlike the way streaming service algorithms box fans into localized musical forms. Based on all this, it seems like right now, we’re somewhere in the middle of the music industry’s feudal period. So to see where we go from here, let’s look at where feudalism went.

Many factors helped end feudalism. One was that currency became the main means of transaction, so you no longer had to pay with military service (or goats, for that matter). A merchant class bubbled up, whose loyalty went to suppliers and customers—not lords. What’s more, a push for individual rights took hold. People wanted control over their destinies.

Also, social unrest hit. The plague impacted much of the workforce, making the workers that were left more valuable—but they still were paid the same (sound familiar?). However, as feudalism faded, society became more involved in trade and currency, governments coalesced into a centralized power instead of multiple lords grabbing their own power, and individuals had more freedom with more rights.


But the best part of our story is that feudalism was followed by the Renaissance. As to what this would look like for the music industry, feudalism’s ending might provide some clues.

Music distribution could coalesce into a new, centralized entity that’s based on a model conceptually more like ASCAP and BMI than dozens of labels or platforms. Artists will likely demand more rights and higher payments, and when a more centralized service offers these as an incentive, it will start generating exclusive music that adds value—so fans would be willing to pay more (the Netflix “original content” model).

Furthermore, it will be understood that feeding the goose that lays the golden egg is the best long-term strategy. Payments and rights management will use blockchain-based smart contracts (not the same thing as cryptocurrency), so songwriters, producers, and even session musicians can be represented.

Perhaps the biggest change is that these new, centralized entities won’t own any rights, or collect money and then disburse it. They’ll create a financial model where fans pay directly to artists via peer-to-peer transactions, under terms decided by the artists—not some CFO. Of course, whoever creates this framework will take a cut to keep the lights on, and make a tidy profit.

Now before you think I’m crazy, remember that four years before Napster existed, I said that physical media would disappear, and people would download music from a “celestial jukebox” (the term “cloud” didn’t exist back then). So, you never know…