The Internet And The Music Industry: Friends Or Foes?

When Radiohead decides to release their latest album online and let consumers decide how much they wanted to pay for it, some wondered if they were marketing geniuses, or about to lose a huge amount of money on a publicity stunt. After all, this kind of music distribution lies at the center of a major controversy: is free music available over the Internet a benefit to the music industry, or a major source of lost revenue? On the one hand, it can be argued that when consumers can get a free download of some songs, then those consumers are more likely to buy the entire album, or buy other songs from the artist, as well as potentially going to concerts and buying other merchandises. On the other hand, there are many within the music industry who feel that any time a person downloads a song for free, without the consent of the people or company who own the rights to that song, it is theft. Without a comprehensive solution to the problem, illegal file-sharing will continue, and record companies and artists will not earn all of the money they are entitled to from the works they create and promote.

Taking a look at Radiohead's approach, one might simply say that such choices can be left up to the artists, as well as to the consumers. Unfortunately, there are a huge number of problems with such an approach. First and foremost, the artists are not necessarily the owners of any given song; nor are they the only ones who have a financial stake in songs, albums, and downloads. As Paul McGuinness, manager of U2 explains, the people who stand to lose or make money on music that is produced anywhere other than a particular artist's or band's own home operation, extends from, "The artists to producers, managers, tour promoters, and people who work for performance venues", and also extends to store owners where music is sold, the owners of websites where music is sold, the vast number of people working for entertainment and recording companies, the Internet Service Providers (ISPs), radio and television stations that use the music for their content to attract listeners or viewers and advertisers, and the list goes on and on. In addition, even if artists were willing to sell their music at a particular price, or give it away, the still do not have control over what will ultimately happen to it, since it is so easy for people with the right technology to convert files to a format that can be shared over the Internet. McGuiness also states that even though Radiohead offered its new album for free, people still downloaded it from sites where music is available in illegal copied formats.

But really, how big of an impact is the Internet and illegal downloading, having on the music industry? It is possible to compare the issue of illegally downloaded music files to the same kinds of issues that came about when cassette tapes were first being sold, and people could tape songs off the radio, or tape albums and share them with their friends. Similarly, anybody with a CD burner on his or her computer can copy any album over and over again, and give those copies away, or even sell them illegally. Still, because people can obtain copies over the Internet, rather than from their friends, it is possible for thousands upon thousands of illegal copies to be made from a few sources, rather than, for example, a few friends to copy each others' CDs.

Of course, Internet file sharing is not the only reason that record company sales have been declining. It is possible to consider a variety of reasons for the decrease, for example, Michael Geins explains that, "The pricing pressure has had a dramatic impact on the revenue generated from each CD sale", that is, stores like Wal-Mart keeping prices below a certain level, to competition between multiple forms of media, to fewer new releases being offered. So it may be, for instance, that consumers only have a certain amount of money to spend, and if they spend that money on a DVD or a video game, that is less money to spend on CDs. As Michael Geins explains, "The popularity of DVDs is surely related to the decline in CD sales and the shrinking shelf space allocated to CDs by music retailers". Still other questions to ask might be how the impact of legal Internet music sales services, like iTunes, impact the overall record industry sales. For instance, if consumers can buy one popular song for 99 cents, rather than buying an entire album for roughly fifteen dollars, or even a CD single for four or five dollars, then there would potentially be a loss of revenue from these legal ways of getting music.

The music industry has pursued many lawsuits and other legal attempts to try and stop illegal file sharing of copyrighted music. For instance, European court lawsuits have been aimed at, "Forcing ISPs to disclose Internet users who are using illegal file sharing programs". Even when such lawsuits are succesful, they have not had the impact of shutting down illegal file sharing of music. People are left to debate whether the music industry really is losing money in the way it says it is, and for the reason it says it is, or if it is just an attempt to control distribution, or earn more money off the same old material. The question is not an easy one to answer, but tend to side with those who stand to lose money from people using their work without having provided them with compensation.

The Changing Face of Media: Where Do We Get Our News?

How often do Americans read a newspaper? How often do they look at the website of a newspaper? What about news sites linked with television stations or news sites that are independent of other forms of media? The way people get their news has been changing ever since the growth of the Internet. In fact, an article from the Wall Street Journal indicates that, "Some papers have lost as many as 13% of their readership in one year", with most papers losing between one and three percent for the year. Those declines continue until today. Mainstream news sources have been losing ground against web sites that allow access, whenever the reader wants it, often without the reader needing to pay for a paper subscription. Furthermore, by accessing news online, the readers can go to the news they want, unlike with television news, and do not need to cast several unwanted pages, as they might with a print paper. Still, there are conflicting reports on whether newspapers, combined with their websites, are gaining or losing readers. The information on how many people are reading newspapers can be confusing. One has to consider the source in looking at any statistics, as well as the way that the statistics were gathered and implemented. After all, newspaper companies have an interest in making it seem that they still attract plenty of readers, in order for them to attract plenty of advertisers. The statistics on readership may very depending on where you are looking. A report from the PEW Research Center, for example, points out that since 2000, "The total number of readers of online sources tied to mainstream news sources has been on decline". The survey indicates that most people who use online mainstream sources use it in addition to their daily papers. For example, a person with a newspaper subscription may be interested in a particular story, and then go online looking for stories that are tied to it, or for additional information that the newspaper might offer. So online readership may or may not be increasing, or may simply be part of the same audience for the print form of the newspaper.

An article in USA Today, though, claims that, "The average number of monthly visitors to U.S newspaper websites rose by nearly a third in the first half of 2006". But that article was taken from a survey by the Newspaper Association of America, an organization that may have an interest in supporting the view that plenty of people are still consuming both print newspapers and online newspapers. The NAA wants to support its members by suggesting there is still a huge newspaper audience in print and online, to encourage more advertisers to spend more money with newspaper companies. Furthermore, some of the statistics are questionable. For instance, The Washington Post measures total readership using the "average weekly print audience and the net 30-day website audience". In other words, the readership for the print version is calculated based on estimates, and then the traffic to the website is measured by how many times people visit the site, not necessarily how many unique visitors use the site. At the same time, an article at Editor and Publisher claims that "If you count Web traffic, newspapers are actually more popular than ever". This is in article about the metrics used to determine readership of newspapers. That is, for years, newspapers have used a measurement of readership that suggests that for each newspaper purchased, several people will actually read it, as it is passed along. This metric, however, was never really backed up with clear, legitimate data. So newspapers companies are trying to devise new ways of figuring out how many people are reading newspapers, either the print version, or the online version. This can be tricky, as many of the people who use a particular news web site may be consumers of the print paper as well.

Beyond the advertising money, some suggest that there is much more at stake with the decline in readership of newspapers. For example, the Readership Institute indicates that in addition to the decline of readers of newspapers, there has been a decline in "social capital" or the involvement that people have in their local communities. For example, author Robert Putnam indicates that , "Membership in local PTAs and even in local bowling leagues has declined", consequently after the decline of readership. The connection between newspapers and these others elements of society, according to Putnam, is that they signal that people are more absorbed in their own concerns, and less involved in their communities in ways that would put them in frequent contact with their neighbors for common causes. Newspapers, because they were traditionally community-based, could have an impact on how involved people are with their communities in this view.
Whatever view one takes, the indication is that newspaper readership for print editions is declining. It takes some clever manipulation of statistics and surveys to suggest otherwise, or to suggest that readers have moved directly from print newspapers to the websites of those newspapers. People have so many ways to get news these days, whether it is in print, over the radio, television, or Internet, there is no clear way to measure exactly where news is being consumed and by who, and to what effect. Sorting this issue out will likely take many years, and see more people shifting their news selections about in every personal ways.

Live Nation : 360 Deals

Media companies are now taking over for some of the biggest artists in the music business, in new ways that amount to near ownership of the artists and their images. Live nation, a company that was previously owned by Clear Channel Communications, has signed major stars in the last two months, including Madonna, U2, and Jay Z. Just as Clear Channel Communications was bent on world domination of radio content, Live Nation seems determined to take over the rest of the information, appearances, and merchandise that fans and music consumers can get from and on the biggest stars in the business. Live Nation is engaging in what are called "360 degree deals" which essentially means that Live Nation takes control of negotiating everything from the concert venues where artists will appear, to what negotiating everything from the concert venues where artists will appear, to what television shows their music will appear on, to what types of products will bear on artist's name. It seems somewhat odd that some of the nation's biggest superstars, who spent so much time carefully crafting their images, and engaging in brilliant efforts at marketing themselves, would turn over the reins to a company that is concerned only with earning money from those images. What is unclear is what impact such deals will have on up-and-coming artists. For now, the focus is on whether or not the deals that these industry giants have signed, and whether they are worth it to Live Nation. Larry Bills of Bizmology argues that the deals are smart for Live Nation, while Peter Kafka of Silicon Alley Insider says that the Madonna deal in particular is a money-losing proposition for Live Nation, I offer my interpretations of Bills and Kafka's articles below and also on the author's blogs.

Live Nation is Singing a Bold Tune in the Music Biz:
Comment:
First of all, you have provided some strong analysis of the recording industry, including your explanation that a company in the music industry cannot survive off a single revenue stream. That is, simply promoting concerts or selling CDs is not something that will keep a company afloat anymore. So, from that perspective, your praise of Live Nation makes sense. However, you commented that Clear Channel's dominance in the radio field has led to the promotion of a lot of bad music. No arguments from me there. But what does not make a lot of sense is why one instance you think that heavy-handed corporate control of an allegedly artistic pursuit or medium is bad, but in the other it is acceptable. Granted, Madonna, U2, and Jay Z have already established themselves and have the clout to retain creative control. But what about new artists that might be pushed into a 360 model, only to find themselves cranking out product to serve the needs of Live Nation? How is that going to lead to anything other than more bland music and manufactured "artists"? Your interest in the business end of it and your contention that 360 deals are the way of the future is a valid argument to make, in terms of the need for the music industry to make money in the current market. However, one imagines that if Madonna, U2, or Jay Z had been operating under 360 degree deals from the start, rather than from a position of power, they would hardly have the power and recognition that they currently enjoy. Rather, they would be like the one-hit-wonders that you complained about in a market where the bottom line is first, and artistic development second.

Live Nation's 120 million Bet: Breaking Down Madonna Deal
Comment:
Thank you for your comments in this issue. You take a straightforward approach to the Madonna deal with Live Nation, questioning is that is potentially a money-loser, as Madonna makes a great deal of money up front, and has minimal obligations under the contract. One imagines that Live Nation has constructed a deal that requires such things, but you point out that even so, albums will still lose money under the terms of the deal. Live Nation could still attempt to make money by landing Madonna songs on every single television show and movie that is produced in the next decade, and by selling Madonna perfume, but the money involved there is not likely to be enough to cover the money that Live Nation paid up front already. What seems to me to be the real impetus behind Live Nation signing deal with Madonna, though, is the ability to sucker new artists into similar deals (but which terms much more favorable to Live Nation) by telling up-and-comers that all the big name stars are in 360 deals contracts. Madonna is essentially immune from Live Nation's efforts at control, but young talent, eager for a shot at the big time, may be too willing to jump at the chance to turn over a huge chunk of their tour money to Live Nation, just to open up for a much bigger, more established band. Live Nation may simply be taking a bath on the Madonna deal to, as you point out, try to snow investors, and gain more control over the music business.

Movie Industry : Relocating American movies elsewhere

The advent of globalization opens the door for Hollywood major studios to relocate film production overseas, and the trend is accelerating exponentially. This suggests that in terms of production cost, the competitive advantage of American film industry is waning. According to the Directors Guild of America and Screen Actors Guild, a U.S runaway production which is filmed in another country is to achieve lower production costs. The average American film production cost ranges from $90 to $100 million. As cost reduction becomes imperative, major producers choose to shoot their films in a country that offers lower production cost. Based on report by Center for Entertainment Industry Data and Research in 2006, the number of theatrical releases filmed in the U.S dropped from 127 in 1998 to 99 in 2005. From these statistical figures, it is suggestible that for many reasons, the domestic film industry has lost its competitive advantage to other countries.

It is proven that shooting overseas significantly reduces production costs. The Canadian government's program of tax rebates and incentives, combined with lower production costs and a favorable exchange rate, can reduce a film's budget by about 25%. China is another emerging site for U.S Runaway production. Quentin Tarantino's Kill Bill was shot in China, while Miramax filmed one of its World War II picture on the Shanghai Film Studios. The production cost in China was one-eight of the estimated U.S production cost. Therefore, from the amount of production cost saving, foreign film industry has the better competitive advantage. Subsequently, it is necessary to examine the negative impact of a U.S runaway production in terms of financial and job losses. In 2005, the U.S market share of production dollars on theatrical releases "plummeted" from 71% in 1998 to 47% and the decrease in U.S production of theatrical releases represents a cumulative loss to the U.S economy of $23 billion. In terms of job losses, according to Monitor Report, in 1998 more than 20000 full time jobs in film industry were lost. These figures indicate that due to the decline on f its competitive advantage, a significant segment of American film industry suffers. The economic causes behind a runaway production range from lower wage rate, lower rental rates for sound stages and equipment, advantageous foreign exchange rates, governmental tax incentive and subsidies. The most obvious competitive advantage of the foreign film industry is the cheap labor cost. For example, the minimum weekly salary of an assistant director in Canada is $2,927, while in the U.S it is $3,285. In Romania, labor cost can be 80% cheaper than American labor. According to one film executive, a driver working on a movie in LA can earn as much as $470 a day, while in Bucharest the daily rate for the same job may be as low as as $9.52. Moreover, the competitive advantage of foreign countries is beyond just providing the daily crews of the film production. For example, a number of Indian companies were hired to work on the visual effects and animation shots for major Hollywood productions like Spiderman 3, Cars, and Lord of the Rings. The total cost in the U.S is estimated to be $100 million to $175 million, while in India it ranges from $15 million to $25 million.

It is undeniable that the mass exodus of Hollywood production in a foreign land suggests that the American film industry cannot manufacture goods and services that can compete with the global standard. Whether it is the cheap labor, or the fiscal policy, it is only logical that major studios would resort to another country when it comes to production cost. However, it is important to note that the complexity of a film industry goes beyond mere production cost. The creative force behind the film, the state of the art technology needed to produce a movie that would mesmerize the audiences, the capital availability to spend $200 million on a single film, and its global distribution network and publicity machinery that can get its movies into theaters worldwide, all suggests that the competitive advantage of American film industry as whole remains unchallenged. In fact, shooting overseas for the sake of cost reduction only proves that the people of the highest rank in the industry know how to capitalize the opportunity offered by globalization. Runaway production is just one example of how Hollywood capitalizes global force at the expense of its domestic industry. The incorporation of global cinematic style through the use of international directors, choreographers, and actors, and the remake of best-selling foreign movies, also saliently exemplifies Hollywood's competitive advantage as a giant industry that has the capability to capitalize globalization. As the advent of runaway production suggests that one element of American film industry is waning, it is ultimately done for the sake of expanding its global hegemony.

All Over The Web: Best Media Sites (2)

Looking for entertainment news? The web has more than you can ever possibly use, but how good is any of it? In a world where there are multiple cable networks doing little more than covering entertainment "news" around the clock, how can web sites compete? The answer is to offer web users the ability to go directly to the information they want, without having to wait through teasers and commercials. With those criteria in mind, as well as general issues of validity of information, and user-friendliness according to the Webby Awards and IMSA criteria, the following sites dealing with media and entertainment provide differing experiences for web users.

The Variety website is perhaps one of the best entertainment sites, with a mix of legitimate news stories on the entertainment industry, a bit of confirmed gossip, and reviews on music, books, and movies. The homepage is clean and well organized, giving viewers some information that many are likely to be seeking, such as the latest box office receipts, along with links to plenty of internal content that is clearly labeled. Forbes.com/media is interesting but unless you are really fond of ads clogging up your computer while you try to get the news, it would be a hassle. With a focus on business aspects of the entertainment industry, as well as gossip, Forbes is easily outclassed by Variety's much cleaner access. Metafilter.com is a "community weblog". Apparently, anyone with a blog can get a link here, which leads to a glut of odd blog "teasers" trying to tempt readers to check out the various stories. Unfortunately, the content is all over the place, from stories about baseball to proposed television networks. Blogcritics.org is another catch-all blog portal, which is much better organizes than metafilter. In many cases, the blog links contain in-jokes references that make it hard to determine what the actual articles are about. Fortunately, blogcritics.org has separated out much of its television and video coverage to a second site called blogcritics.org/video. As the name implies, the site has links to blogs with links to video clips of the movies and television shows being reviewed. Iwantmedia.com is useful site for more pure information, tending toward entertainment business. The focus is away from gossip, and more toward trends in media and technology, taken from a variety of different sources including newswires like Reuters, and magazine-based sites like the Hollywood Reporter. Gawker.com is the exact opposite of Iwantmedia.com, proudly declaring itself a site devoted to "media gossip and pop culture around the clock." The site gives exactly what it promises, in a clean layout. Newsbusters.org can be ignored by anybody except right-wingers who actually believe that there is a "liberal media bias" as the blog title proclaims it 'exposes' and 'combats'. However, to get access to the stories, one has to register and have a password. Finally, there is laobserved.com. Perhaps it is attempting to be unique in Los Angeles by ignoring television and film, but its "entertainment" pull-down menu is limited to "casino games, online dating, karaoke, books, music, concert tickets and fantasy football". The site is more for people in LA to find ways to get in contact with people of similar interests.

The Changing Face of Media: Where Do We Get Our News?

How often do you read a newspaper? How often do you look at the website of a newspaper? What about news sites linked with television stations, or news sites that are independent of other forms of media? The way people get their news has been changing ever since the growth of the Internet. In fact, an article from the Wall Street Journal indicates that some papers have lost as much as 13% of their readership in one year (2004) with most papers losing between one and three percent for the year. Those declines still continue until today. Mainstream news sources have been losing ground against websites that allow access, whenever the reader wants it, often without the reader needing to pay for a paper subscription. Furthermore, by accessing news online, readers can go straight to news they want, unlike with television news, and does not need to cast several unwanted pages, as what they would experience with print papers. Whether a survey reports that readership is up or down, the information on readership can be confusing. One has to be careful of what reasons behind a particular surveys are, and how the readership is measured. Newspaper companies have an interest in making it seems that they still attract plenty of readers, in order for them to attract plenty of advertisers.
But the statistics you get may depend on where you are looking. A PEW Research Center survey, for example, points out that since 2000, readership for online sources have been on decline, at least for mainstream news sources. The survey indicates that most people who use online mainstream sources use it in addition to their daily papers. For example, a person with a newspaper subscription may be interested in a particular story, and then go online looking for stories that are tied to it, or for additional information that the newspaper might offer. So online readership may or may not be increasing, or may simply be part of the same audience for the print form of newspaper.

An article in USA Today, though claims that online readership went up by nearly a third in 2006. That article was taken from a survey by the Newspaper Association of America, an organization that may have an interest in supporting the view that plenty of people are still consuming both print newspapers and online newspapers. That is, the NAA wants to support its members by suggesting there is still a huge newspaper audience in print and online, to encourage more advertisers to spend more money with the newspaper companies. Furthermore, some of the statistics are questionable. For instance, The Washington Times measures total readership using the "average weekly print audience and the net 30-day website audience". In other words, the readership for the print version is calculated based on estimates, and then the traffic to the website is measured by how many times people visit the site, not necessarily how many unique visitors use the site. An article at Editor and Publisher claims that "If you count Web traffic, newspapers are actually more popular than ever." This is in an article about the metrics used to determine readership of newspapers. That is, for years, newspapers have used a measurement of readership that suggests that for each newspaper purchased, several people will actually read it, as it is passed along. This metric, however, was never really backed up with clear, legitimate data. So newspapers companies are trying to devise new ways of figuring out how many people are reading newspapers, either the print version, or the online version. This can be tricky, as many of the people who use particular news websites may be consumers of the print paper as well. In other words, "hits" on a web site may or may not be unique users, which is important to advertisers.

Beyond the advertising money, some suggest that there is much more at stake with the decline in readership of newspapers. For example, the Readership Institute indicates that in addition to the decline of readers of newspapers, there has been a decline in "social capital" or the involvements that people have in their local communities. For example, author Robert Putnam indicates that membership in local PTAs and even in local bowling leagues has declined as well. The connection between newspapers and these other elements of society, according to Putnam, is that they signal that people are more absorbed in their own concerns, and less involved in their communities in ways that would put them in frequent contact with their neighbors for common causes. Newspapers, because they were traditionally community based, could have an impact on how involved people are with their communities in this view.
Whatever view one takes, the indication is that newspaper readership for print edition is declining. It takes some clever manipulation of statistics and surveys to suggest otherwise, or to suggest that readers have moved directly from print newspapers to the websites of those newspapers. People have so many ways to get news these days, whether it is in print, over the radio, television, or Internet, there is no clear way to measure exactly where news is being consumed and by who, and to what effect. Sorting this issue will likely take many years, and see more people shifting their news selections about in very personal ways.

All Over The Web: Best Media Sites (1)

When searching the media for information on the media, the Internet has plenty of options, ranging from right wing to left wing, and everything in between. While it is possible to find support for virtually any idea or any position on the web, some sites are simply more legitimate than others according to the Webby Awards and IMSA criteria.
A sampling of different media-oriented web sites reveals where to go for particular kinds of coverage, as explained in brief synopsis of several sites. The links to all websites are provided under the Linkroll menu on the right side of this blog.

The first one is the American Film Institute website provides visitors with its picks for top movies and other valuable pieces of film. It takes film and television seriously, like a more sophisticated and smart version of Entertainment Tonight. The second website is called Editor & Publisher. The information on the site is generally devoted to citing the best stories in journalism, as well as awards going to various writers and editors, based on the quality of their work. A website called Media Matters is definitely a liberal organization, as it even attacks the New York Times for being too conservative on some stories. Still, it is hard to argue with many of the positions Media Matters takes when it analyzes how the media is often lazy in its approach to covering issues, and allows simple ideas to dominate, as well as presenting falsehoods in many cases. A blog called Media Shift provides essential comments on "new media" like blogs and "citizen journalism". It provides interesting look at how the Internet is causing changes in information and news around the world. Another blog called The Communication Blog. It is useful for some important, but sometimes obvious comments on the media. The down side is that this web site contains a huge amount of text, extending over time. Moreover, a blog called the Rocky Top Talk is very interesting to read but sometimes it provides unnecessary information about the media. Some comments seems counter to the idea of having independent media. Another blog called Reportr.net provides commentary on whether the "gatekeeping" role of media should be extended to blogs and websites. If the existing media get the means to legitimize blogs and unofficial media, then it seems that blogs could end up doing nothing more than repeating official stories, or losing their status as "legitimate". A website called News Watch provides reader with many interesting articles about the media. The downside is that the lay out of the web is rough and messy, but the information provided is valuable. My favorite website is called Media Channel. Here, there are connections to everything from clips of The Daily Show, to links to numerous other blogs and media sites. With the number of logos, photos, and links, it is somewhat difficult to tell what the particular angle is for this site. What is most interesting is a link to a commentary by Walter Cronkite, one of the most respected men in the history of television journalism, discussing the MediaChannel site as an important place to go for valuable news commentary.

Microsoft combines with Yahoo: Will it work?

The rumors are true. In the recent weeks, the business and the media world have been shaken with the news of the Microsoft and Yahoo possible merger. Will the join forces between these two internet giants can beat Google. Inc? Microsoft and Yahoo have discussed a possible merger that would pair these two respective strengths for years in order to get in step with the booming online-advertising market. With Yahoo just decline a $44.6 billion offered by Microsoft, how can this offer be finalized?. Such a deal would create the most dominant force on the Internet in terms of advertising. Also, it would also join the young and hip crowd, Yahoo and a more old and conservative crowd, Microsoft. Together they can attract wider audience who can be benefited in terms of the news and the entertainment coverage. I have therefore decided this week to explore the blogosphere to further understand what bloggers feel about the merger between Microsoft and Yahoo. The first post I found was by Laura Ries called The Origin of Brands Blog: Micro-Hoo?!. Her entry discusses the drawback of this merger and she believes that the combine forces would not be beneficial for them. The second post was published by newsday.com and it is called "Yahoo-Microsoft merger could benefit the Web users" by Richard J. Dalton JR.
His comments contradict Laura Ries' point of view about this issue. Each of their comments has its own strength and weaknesses and it is just give better understanding about this merger. I have offered my comments on their posts below and also on the authors' blogs.


The Origin of Brands Blog: Micro-Hoo!?
Comment:
Firstly, your blog is very straight forward and easy to understand with the points by points outline. Your honest opinion is much appreciated because this is such a big issue that can make a whole difference in our world. However, I dont agree with Laura that Microsoft and Yahoo merger will not work because both companies need each other. They need to combine power to expand their business as whole. I think the move will benefit both companies because Yahoo is losing market share to the mighty Google and Microsoft MSN 'Market Place' is not moving anywhere. By combining the two forces, Microsoft is going to move to the second ranking in Search Engine Marketing market and Yahoo will have all the capital back up from Microsoft huge pile of money in developing more advance SEM, therefore both companies will have better ground to compete with Google. I dont agree with Laura first point of view that combining two different cultures are not necessarily going to work. Regarding culture, if they keep the names, people will not even know the difference before or after merger, so people will not worry about it. They both can keep their current company's environments and somehow combining the crowds of each company to attract wider audience as a whole. The information given on the net will also be expanded and that will be beneficial for many internet users. If we compare Microsoft and Yahoo agaisnt Google and YouTube, I think they both have similarities which is two giant companies want to expand their business by buying smaller businesses that already been established. Yahoo has been in the business much longer than YouTube, and they both are in the stage where they need help from other companies to survive and expand. Again, business decision is like gambling, even though you already do your best to analyze and predict; sometimes the outcomes are unpredictable. For me, it is still a best bet for Microsoft to buy Yahoo since it will give credits for both companies.


"Yahoo-Microsoft merger could benefit Web users"
Comment:
I strongly agree with all of your comments and you give strong evidence for every statement you offer. I acknowledge your opinion in this issue and support your point of view in this recent big issue in the Internet world. In your first sentence you said that, "The possible merger will benefit the internet users" is extremely true because for an active internet users like myself, having the two companies combined together will give us more advance and entertaining information from the net. Each company has its own strength and perspectives and by combining them together, it will set a bigger goal to satisfy us as internet users. It will also provide a good competition for Google who now is taking over the search engine market by more than fifty percent of users. Like you said, competition is a good thing in the business world, it will provide us with better outcomes from each company because they are always going to be competing for the best. You also said that, "Google has no significant competition in certain areas". However, if the merger is succesful, Microsoft and Yahoo can be a big threat for Google in other aspects of the technology world such as cell phones and softwares. I also support your opinion that if both Yahoo and Microsoft stands alone to compete with Google, it would not been an even competition because Google is already having a head start in the search engine market. However, by combining both companies, they have a better chance to compete with the gigantic Google engine search. Even though Yahoo just declined the $44.6 billion offer, I agree with you that Microsoft somehow will work out a better deal to have Yahoo to accept and finalize the offer. Let just hope in the near future, both companies can agree in one term, that is, the price.

The Internet and the Music Industry: Friends or Foes?

When Radiohead decided to release their latest album online, and let consumers decide how much they wanted to pay for it, some wondered if they were marketing geniuses, or about to lose a huge amount of money on a publicity stunt. After all, this kind of music distribution lies at the centre of a major controversy: is free music available over the Internet a benefit to the music industry, or a major source of lost revenue? On the one hand, it can be argued that when consumers can get a free download of some songs, then those consumers are more likely to buy the entire album, or buy other songs from the artist, as well as potentially going to the concerts and buying other merchandise. On the other hand, there are many within the music industry who feel that any time a person dowloads a song for free, without the consent of the people or company who own the rights to that song, it is theft. Without a comprehensive solution to the problem, illegal file-sharing will continue, and record companies and artists will not earn all of the money they are entitled to from the works they create and promote.

Taking a look at Radiohead's approach, one might simply say that such choices can be left up to the artists, as well as to the consumers. Unfortunately, there are a huge number of problems with such an approach. First and foremost, the artists are not necessarily the owners of any given song; nor are they the only one's who have a financial stake in songs, albums, and downloads. As Paul McGuiness, manager of U2 points out, the people who stand to lose or make money on music that is produced anywhere other than a particular artist's or band's own home operation, extends from the artist to producers, managers, tour promoters, and people who work for performance venues, store owners where music is sold, the owners of websites where music is sold, the vast number of people working for entertainment and recording companies, the Internet Service Providers (ISPs), radio and television stations that use the music for their content to attract listeners or viewers and advertisers, and the list goes on and on.
In addition, even if artists were willing to sell their music at a particular price, or give it away, they still do not have control over what will ultimately happen to it, since it is so easy for people with the right techonology to convert files to a format that can be shared over the internet. McGuiness also points out that even when Radiohead offered its new album for free, people still copied it illegally. That is, people could have gone to Radiohead's site directly and downloaded the entire album for free, completely with Radiohead's consent. Yet, many people still went through sites where music is available in copied formats, essentially illegally, to steal the same album they could have obtained for free anyway.

But really, how big of an impact is the Internet, and illegal downloading, having on music industry? The answer depends on who is asked. For example, some compare it to the same kinds of issue that came about when cassette tapes were first beign sold, and people could tape songs off the radio, or tape albums and share them with their friends. Similarly, anybody with a CD burner on his or her computer can copy any album over and over again, and give those copies away, or even sell them illegally. Still,because people can obtain copies over the Internet, rather than from their friends, it is possible for thousands upon thousands of illegal copies to be made from a few sources, rather than, for example, a few friends to copy each others' CDs.
At the same time, some sources claim that the losses from Internet file sharing are not the only reason that record company sales have been declining. For example, one analysis of the Canadian music industry points to a variety of reasons, ranging from stores like Wal-Mart keeping prices below certain level, to a competition between multiple forms of media, to fewer new releases being offered. So it may be, for instance, that consumers only have a certain amount of money to spend, and if they spend that money on a DVD or a video game, that is less money to spend on CDs. One interesting issue I did not see addressed was how the impact of legal Internet music sales services, like iTunes impact the overall record industry sales. For instance, if consumers can buy one popular song for 99 cents, rather than buying an entire album for roughly fifteen dollars, or even a CD single for four or five dollars, then isn't there a loss of revenue from these legal ways of getting the music?

The music industry has pursued many lawsuits and other legal attempts to try and stop illegal file sharing of copyrighted music. For instance, a recent unsuccesful lawsuit in Europe tried to force ISPs to disclose Internet users who were using illegal file sharing programs. Even when such lawsuits are succesful, they have not had the impact of shutting down illegal file sharing of music. People are left to debate whether the music industry really is losing money in the way it says it is, and for the reason it says it is, or if it is just an attempt to control distribution, or earn more money off the same old material. This question is not an easy one to answer. But I would tend to side with those who stand to lose money from people using their work without having provided them with compensation.