Trapped In Cognition: The Plight of the Digital Age
Kyle Bylin (@kbylin), Associate Editor
If there is one thing to be learned from the last decade in the history of the record industry it’s this — that smart people make bad decisions. But, had you kept up with and read through the numerous books, essays, and news articles published during these times the conclusion you would’ve likely arrived at is that these weren’t smart people at all. That, in fact, these music executives were ‘out of touch’ and struggling dinosaurs, whose only exit from this world entailed the mass extinction of their kind and the destroying of the empires they created. This, however, isn’t exactly true, at least not to the extent that many would have you believe or try to convince of you otherwise. To be sure, a far more plausible scenario divulges that what these smart executives fell into are “cognition traps.”
These are, in the words of author Zachary Shore in Blunder: Why Smart People Make Bad Decisions, “inflexible mind-sets formed from faulty reasoning.” He goes on, “They are the stolid ways in which people approach and solve problems based on preconceived notions and preset patterns of thought.”1 What he argues is that cognition traps are the mental framework that leads smart people to blunder. A distinction he makes is that a mistake is “simply an error arising from incorrect data,”2 where a blunder is “a solution to a problem that makes matters worse than before you began.”3 In effect, he explains, cognition traps have “nothing to do with lack of intelligence,”4 seeing as they seem to “flummox even the brightest decision makers.”5 Through the lens of these “traps” much insight is gained into the digital music revolution.
The first of which Shore calls “causefusion,” one he depicts as “any misunderstanding about the causes of complex events.”6 This type of cognition trap “leads us to oversimplify, often at our own peril.”7 Ten years ago, saying that file-sharing was responsible for the decline in sales the record industry suffered, in part, seemed like a logical conclusion. And a hard one to argue against at that, due to the significant amount of unauthorized content that was being shared on the file-sharing sites and networks at the time, and, continues to be shared to this very day. As a result, various smart people have “focused too finely on one particular cause while ignoring many other factors engaged in the process.”8 They focused on file-sharing, not the frequency of societal and technological shifts.
Initially, executives, journalists, and lawyers elevated single factors like file-sharing and pirates without seeing them as “enmeshed in a complex web of interactions,”9 of which technology and music fans are each just a part. When, in fact, the rise of the networked audience, the fall of mass marketing, the fracture of the media landscape into niches, the end of the format replacement cycle, the explosion of alternate and immersive entertainment options, the convergence of top-down corporate media and bottom-up participatory culture of the Internet, and the evolution of social music in terms of listening habits and media sharing, garner a less novice and ill-informed approach to understanding the complexity of our times. Yet, file-sharing, over these focuses, is still held solely accountable.
“The fallacy of a decline in CD sales being attributable to unauthorized copying serves the record industry’s political objectives extremely well, and thus while the correlation is false, it is advanced at every opportunity,” William Party argues in Moral Panics and the Copyright Wars. “The decline is attributable to the industry’s inability to force consumers to buy albums.”10 Shore further notes, “Overempathizing one cause, rather than exploring the many parts engaged in a process or numerous possible risk factors for a behavior, is likely to produce solutions with consequences worse the original problems themselves.”11 Such is the case of the war on piracy. Since its inception not only has it completely failed to change mass behavior, it has also failed to bring forth more favorable circumstances at all.
II.
Part of the reason for this failure relates to another cognition trap called “exposure anxiety,” which is the “fear of being seen as weak.”11 But, Shore maintains it is more than just a fear. “It is a belief,” he writes, “that failure to act in a manner perceived as firm will result in the weakening of one’s position.”12 Back in 2003, had the record industry not began suing music fans, in a sense, what they feared is that, had they not done otherwise, they wouldn’t be taken as seriously. That without demonstrating excessive force and the willingness to use it, music fans wouldn’t feel threatened enough by the record industry and would perceive them as being weak. They would keep file-sharing. Having fallen victim to the cognition trap, exposure anxiety drove the record industry to use excessive force.
In doing so, they also fell into a trap called “flatview,” which is “any rigid perspective that constricts our imagination to just one dimension.”13 The record industry saw anyone who filed-shared music as a pirate, as effectively displaying the unwillingness to pay for music. They categorized music fans as those who were with them and those who were against them. “Since complex problems typically contain shades of gray,” Shore explains, “the flatview trap limits our understanding of what we see, and therefore leads us to simplistic solutions.”14 Thus, the record industry’s flatview of file-sharers fed into their exposure anxiety and caused them to seize upon a “simple, though counterproductive, solution,”15 instead of seeking “creative plans that demonstrated moderation as well as resolve.”16
Consequently, by overreacting and using excessive force, what this did was ensure that the aftermath of campaign and the lawsuits would leave the record industry less secure than before the file-sharing began. Their efforts to impede the illegal behaviors of fans, through the litigation, would not demonstrate their strength, but reveal their weakness. And, in one fell swoop, the record industry only diminished the position they had sought to protect. Contrary to whatever it is that the record industry thought would happen they found out that people don’t always behave like you expect them to and that, in general, mass behavior is incredibly hard to change. Regardless of the situation, it turns out that much our efforts to regulate mass behavior in any meaningful way are often thwarted.
What disillusioned the record industry in this manner perhaps relates more strongly to a trap referred to as “cure-allism,” or “an almost religious belief in a theory’s universal applicability.”17 Shore says that, “It occurs when we take a theory that has worked well in some cases and we apply it to seemingly similar cases where the theory fails.”18 Relevant to this trap is the steady use of litigation by the record industry as an instrument to inhibit the spread of innovations and technologies that run contrary to their business model. In the past, they actively used propaganda and lawsuits to see to it that anything or anyone that proposed a threat to their way of life became inundated with courtroom proceedings, but, these “measures” soon proved to be highly inefficient in the face of music fans.
For the reason that, cognition traps like “cure-allism [prevented them] from seeing specificity – individual, cultural, and historical,” Shore says. “They [made them] forget that human beings are complex and that no single theory of their behavior will always hold true.”19 What makes this trap so seductive is that it “usually begins with theories that work, and work well on certain problems.”20 But, it’s when those theories, like lawsuits, are applied where they don’t belong that they can ruin lives, costing individuals hundreds and thousands of dollars. “Many figured they would simply win in the courts and the CD-selling business would go back to normal,” Steve Knopper says in Appetite for Self-Destruction: The Spectacular Crash of the Record Industry in the Digital Age. As a result, critical years were lost and a gratuitous amount of money was spent.
All involved, as it would soon appear, fell into the cognition trap known as “mirror-imaging,” which is when the record industry assumed, consciously or unconsciously, that the other side, the file-sharers or “pirates,” would think and act like they and their previous opponents would. That in fear of being brought to court, people would stop file-sharing. But, what happened is that they failed to see the problem from the perspective of the fans themselves, and rather than realizing that they no longer wanted to buy whole albums, just singles, what the record industry did is they told fans in a patronizing way what’s good for them. Music executives, and, artists included, mistakenly assumed that fans still loved albums in the way they loved albums, and soon became maddened that they didn’t.
III.
In effect, though, many of the cognition traps discussed thus far bring us back to the prevalence of “static cling” in the record industry, one that “prevents us from recognizing or accepting a changing world.”21 This is why that, “Instead of soberly assessing [these] changes and adapting to them,”22 they strongly resisted. The record industry’s longing for things to remain as they have always been is what has kept them from prosperity, and, rather than accepting their business is in fundamental flux, they launched “The Copyright Wars.” Which are, from the perspective of Paltry, “an effort to accomplish the impossible: to stop time, to stop innovation, to stop new ways of learning and creating.”23 They are “wars to ensure that old business models are frozen into place,”24 left untouched by advances.
To paraphrase Jeff Gomez in Print Is Dead: Books in Our Digital Age, the record industry needs to “realize that we live in a time of almost unimaginable change, and to think we can have such transformation in other areas of our lives but have [music] and [the record industry] stay the same, is naïve bordering on irresponsible.”25 He explains, “And of course, for [music] to change, the business models on which [the record industry] has been built on for the last century will also have to change.”26 Beliefs among executives that the current structure of their industry and its dominance over the marketplace represents the natural order of things fail to appreciate how abrupt and prevalent their creative destruction will be if they are to be maintained much longer. Static cling, to date, has been hardest trap for them to overcome.
Rest assured, what’s to be learned here is that throughout the history of the record industry and their plight in the digital age, most prolifically chronicled by journalist Steve Knopper and music critic Greg Kot, some of the brightest and most talented executives in the world got caught in cognition traps and wound up defeating themselves. Not for the reason that their intelligence was flawed or that their reasoning was inferior, but because this is “part of cognition traps’ seductive skill.”27 Shore enlightens, “Though at other times we might know better, once they take hold of our mind-set, they lure us into false beliefs and imprudent judgment.”28 They caused these executives to confuse the causes of complex events, to fear being seen as weakened, and to refuse to accept a changing world.
Many, if not all, of the blunders that have occurred over the last decade in the record industry came about partly from reductive thinking. They happened when executives, journalists, and lawyers “oversimplified complex situations into metal sound bites,”29 by concluding that file-sharing was solely responsible. Other times they happened because executives brandished anyone who wasn’t paying for music under their terms as the enemy, as someone to be waged war against, when, actually, many of these so-called “pirates” were paying customers, too. In various instances they happened because the record industry “avoided thinking about how others would react to their solutions altogether,”30 ranging from their apocalyptic handlings of “the Copyright Wars” down to PressPlay.
For those in the record industry who hope to avoid future blunders, what Shore argues is that they need to learn to embrace uncertainty. Not so that they stop searching for solutions, but in the way that they need to keep reminding themselves and each other that their explanations are often based on insufficient understanding. If they want easy answers like file-sharing — that’s what cognition traps provide. But, if the record industry hopes to escape these inflexible mind-sets that cause them to blunder and only produce solutions to their problems that make matters worse for them than before they began, what they need is to grow more comfortable with the uncertainty of our times — that way, their blunders wouldn’t be as great. If, instead, they insist upon absolute certainty, if they remain trapped in cognition, blunders are more likely to occur. This, in turn, will only deepen their economic woes and further obstruct their path to salvation.
Additional Reading:
Song Stories: A People’s History of Popular Music
Contact:
kyledotbylinatgmaildotcom
References:
1. - 9. Shore, Zachary. (2009). Blunder. Bloomsbury Pub Plc USA
10. Patry, W. (2009). Moral panics and the copyright wars . Oxford University Press.
11. - 22. Shore, Zachary. (2009). Blunder. Bloomsbury Pub Plc USA.
23. - 24. Patry, W. (2009). Moral panics and the copyright wars . Oxford University Press.
25. - 26. Gomez, Jeff. (2009). Print is dead. Palgrave MacMillan.
27. – 30. Shore, Zachary. (2009). Blunder. Bloomsbury Pub Plc USA
Kyle;
With respect, this is the biggest crock of shit I’ve ever read.
Instead of using research from a bunch of guys who never set foot in a record label, or probably even a record store, why don’t you for once balance your research by talking to people who were actually in the industry? Talk to any indie retailer, who had a thriving business prior to file sharing, and spin them your “reductive thinking” theory. Once they stop laughing, they’ll tell you about how their business dropped to almost nothing within 6 months of Napster launching. Or ask them about how a student would buy one copy of a new album, and a 10 pack of CDs, telling the clerk how excited all their friends back at the dorm were to hear the new record.
With respect, you really should explore both sides of the argument. Actually talking to people who were there, from the various stakeholders. That’s what journalists are supposed to do, isn’t it?
Anybody with a brain in the music business knew that we weren’t going to just go back to selling CDs. One thing not mentioned in Knopper’s book (probably because it doesn’t serve his agenda to paint everyone at the labels as stupid and clueless) is the Madison Project, a direct to consumer download trial that the labels did with Roadrunner in 1998, before Napster. Data clearly showed that consumers wanted to download music and cherry pick the tracks they liked.
Problem was, Kyle, that unlike Napster, labels actually had to get clearances from the artists and publishers to sell tracks as individual singles! That’s right, all the eggheads you list above never pondered the fact that perhaps there were rights and clearance issues involved, we couldn’t just break up albums and create new commercial products without asking the artists and publishers. Shit, we should have just started a file sharing service ourselves, screw the clearances, get millions of users and IPO the company, be rich overnight – if only we did then everyone would be writing what geniuses we were.
The labels knew that the business was going to be about selling single downloads. Of course we wanted to sell albums because they made more money. I had a white board outside my office with the number of single tracks we had cleared for sale in 2000. For about a year, it was under 200 tracks. I literally sat in painful meetings for hundreds of hours, trying to figure out how to get clearances for hundreds of thousands of tracks, when the original artist contracts DID NOT COVER the release of these songs as individual products.
We moved too slow because we had no systems, no product numbers, no clearances, no artwork, the publishers wanted MORE money for downloads, not less, the acts didn’t want their albums broken up, and finally, because the deals we were being offered for the most part sucked. We should have played ball with people like Liquid Audio to a larger degree – but guess what? In 2000, NOBODY was buying downloads, whether they were singles or not. You can blame DRM, bad product selection, or the lack of a good portable device, but people jut hadn’t gotten over the CD yet. Consumers didn’t care about downloads unless they could get them for free.
Was it stupid to think that piracy could be stopped? Well, there were many companies pitching us DRM solutions, pointing out how it worked for computer software, movies and videogames (who all still to one degree or another utilize anti-piracy in their products). I probably got one DRM pitch a week for 3 years. We were doing timed-out promotional downloads since 1996; there was a lot going on before Napster showed up. There was a trajectory that everyone envisioned that got disrupted by file sharing, which no one expected. Not just the labels, but EVERYONE in digital music. Apple uses anti-piracy on their expensive software products even today, how about writing an article suggesting they embrace file sharing copies of Final Cut Pro?
Again, with respect, your entire doesn’t address the real question, which is not about singles, or price point, or the naiviety of labels. The real question is how to compete with an opponent who doesn’t have to get clearances, follow the rule of law, ever write a check to an artist, a performing right society, a publisher, or the federal government.
The RIAA is notorious for suing single mothers and college kids, but hey, they sent letters, offered settlements, they worked thru the legal system. Compared to the file sharing movement, the RIAA was fighting a gentleman’s war. They had an address, a phone number. The labels could have solved file sharing overnight by loading up the networks with virus ridden hit singles – but if they got caught, people would know who to sue and it would be very bad PR. By contrast, dozens of file sharing sites sprung up all over the world almost overnight, and it was impossible to stop them. You couldn’t even contact them if you wanted to do a deal.
Meanwhile the industry was working with a wide spectrum of above board digital music partners. The licensing terms we offered were onerous, the consumer price point unattractive, but it was a complex process and we were in the middle of it. It was a guerilla war, and we were marching in lines across an open field. Of course the record industry was going to get slaughtered.
I’d love to see Zac Shore pitch his “embrace uncertainty” idea to Harry Fox, and see how many clearances he comes out with. Your piece does not even slightly consider the fact that record companies are rights holders, that they have complex agreements with thousands of partners, many with conflicting goals, and changing it all takes time. We had to approach many acts individually and ask if we could sell their single downloads, and many said no, only full albums. In Germany, there were some who argued that because the contracts did not overtly state we had download rights, that we did not have those rights at all. You cannot imagine how complex it was.
There was always hope that we could negotiate respectable deals with legitimate partners, and that the government would help enforce copyright laws that were in place. Every day I went into work, that’s what the agenda was – nothing else. Nothing sinister, no one sticking their head in the sand, the industry has seen many formats come and go. nobody who thought downloads would just go away and CDs would come back.
Discovering and developing talent, marketing and selling music has never been about “certainty”. The biggest mistake major labels made was going public during the CD boom years, when growth was impressive, and Wall Street loved it. After everyone had replaced their collections, and sales went back to normal levels, Wall Street still wanted growth, and yes, some labels made creative compromises and pursued “easy” product with mass commercial appeal. But for every Britney Spears record, there was a Chieftains or a White Stripes or a Rollins album released. There was lots of great music released by the majors (still is) whether or not it would ever get on the radio, Unfortunately, there are no longer many stores around that sell it.
I have to say, I see lots written by people who weren’t there and don’t bother to talk to people who were, yet somehow manage to reach conclusions about how stupid or blind everyone was. It’s certainly a crowd pleasing tune, but it is nonetheless revisionist hyperbole.
When you ignore everyone’s rights, pay no tax or royalties, it’s very easy to be successful. That in a nutshell is what you’re suggesting should have been done – if you disagree, and wish to truly validate your points, then obtain a copy of the terms Napster was originally offering, and how you would have responded positively, in a manner that would include approvals from all the various right holders. Artists are still getting screwed on royalties today, not only by labels, but they complain about what they’re owed by services they’ve licensed directly too. And file sharing services have repeatedly told labels (more as a method of legal protection than as a technical reality) that they cannot track what is traded – so you’d have to get artists and publishers to agree to license without any real idea about how much of their music was traded.
It’s very easy to say what should have been done, sitting in a vacuum 20 years later, checking the rear view mirror. For once I’d like to see the criticism include substantive alternate approaches, based on what deals were originally offered. Based on your ed/ops Kyle, I doubt you’ve ever seem the terms offered by Napster or any other digital music companies back in the day, please correct me if I am wrong.
My sincerest of apologies that this essay failed for you on so many levels and I’ll gladly send out an e-mail very soon — addressing the questions you’ve proposed.
Kyle – no need to apologize to me, whether you mean it or not 😉
I will be very interested in seeing your ideas for a practical solution to these questions and opportunities. Trust me when I say that many very intelligent people, both inside labels and out, were stymied in their efforts back then, and it certainly wasn’t for a lack of desire to make something work.
As a relative newcomer to the music industry, I think all this 20/20 stuff is a waste of energy, considering that a ‘solution’ to the problem has NOT yet been found yet. I happen to agree with the Old Record Guy – a lot of the infrastructure (legal and technological) just wasn’t in place (and still isn’t) when file sharing went big and everyone got a CD drive (file sharing always existed, even in the early days, only the scale has changed).
The real problem, I think, lies not in the music industry who I think is trying hard to swim in an ocean of change, but in technology and culture, a place where the music industry doesn’t have enough clout by themselves.
The first technology problem is that the internet is essentially anonymous, and that *needs* to change at least at the transaction level in order to restore the civility we enjoy in the mud and water real world. I’m talking about providing real names and addresses or at least a 3rd party ID that can be used to direct billing in order to see/read/or hear certain kinds of content. Most people wouldn’t steal if they needed an ID card provided by the ISP to access the internet and that information was automatically transmitted to content owners for billing regardless of the download location. All at a hardware level, like your cable box.
The anonymous transaction promotes ‘wilderness’ behavior and we’ve had it long enough.
Also, what you see today is really yesterday’s technology and if you want anything improved you really need to look years ahead to drive technology changes so that the landscape is more favorable to the music industry. Does it mean changing devices, writing software, creating new audio cards, a new network protocol, a new music format? Whatever it is, it requires big thinking. Apple figured it out – for themselves. The music industry needs to do the same.
The cultural problem is that people are naturally picky about content, (think fruits and vegetables), so we will freely peruse all kinds of content all day long looking for good stuff. We’re wired for it! But we are NOT cut out to make large numbers of financial transactions in any given day. Transactions are part of our *gift* culture, where we exchange our effort/gift for someone else’s. This is a relatively rare thing and I have yet to see a social music site that properly capitalizes on this natural behavior on *both* sides of the transaction.
Old Record Guy (whose comments I love, btw) paints a picture of a Gordian Knot of licensing which entangled the entire industry. I have come to believe that the problem of clearing licensing for the online world was not solvable: it’s no surprise that the Gordian Knot of licensing was finally addressed by Alexander the Great’s technique of slicing it apart with a pirate cutlass. When it’s steam engine time, somebody invents the steam engine; when it’s MP3 time, rightsholders yelling “STOP” are not going to have any effect on the tidal wave.
Regarding Cathy’s comment: no one is going to offer to pay for re-engineering the Internet, to eradicate anonymity for the benefit of the copyright industries.
In her last paragraph, Cathy mentions “gift culture,” but what she is actually describing is a market exchange. But this touches on something I have been trying to wrap my head around:
The Internet and the Web were built in a classic Gift Economy. The protocols which run the networks were hammered out open-source fashion, without expectation of return on investment. Developers were either volunteers, or their efforts were volunteered by their employers. The early years of content were provided gratis, either by pure volunteers (Usenet) or by institutions with missions to disseminate information (universities, the early WWW).
The Gift Economy of the Internet was in contrast to the Market Economy represented by AOL and CompuServe — models which would have been much more palatable to the copyright industries, but which were ultimately abandoned by most consumers.