Are Nicoli & Ames In Trouble?
The NY Post and other sources are saying that EMI’s new
owner Terra Firma are actively looking for a new executive
to oversee day-to-day business and may reach outside the music
business to find one.
A role is also expected for Stephen Alexander, a
managing director at Terra Firma who has often overseen the firm’s
investments in the past. Where this leaves current chairman Eric
Nicoli, US head Roger Ames and all of their recent hires like Jason Flomm remains
unclear.
Whoever is chosen will certainly be charged with cost cutting to pay for the purchase. Expect more news in September and October.
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Why should EMI seek new executives?
The Ipod is without a doubt the champion of portable music players. The introduction of the ipod brought about a new monster in the cannibalistic digital music realm. The ipod has become a major culprit of this feast along side the greatest decoy in digital music history, the Itunes music store.
We know that Apple’s top business is not just in content, but in the storage and management of content. Steve Jobs #1 goal was to create a ten-figure cash cow portable player which would sieze control of the digital music storage market. It didn’t matter to him whether that content was protected or unprotected.
The creation of the apple itunes was just to sell exclusive content for its portable player, while generating scraps of download revenue and expanding upon its brand.
Had someone picked up on the scheme, they would have understood that itunes was the driving force pushing the growth of the ipod because by pricing protected content which lacked interoperablity across other devices, it created a culture of consumers more interested in storage of free content. By giving ipod users the power to store 5000 song, Jobs must have expected at least 95% to be songs not downloaded from itunes. Why else would he protect his content so bullishly? He undertsood that his dominance in the portable music player sector would sealed by leaving others out of the itunes fold. But for it to be a success he would have to create a download management system that was not exclusive to itunes songs only. How is it possible that itunes sells protected content but also allows you to rip and manage upprotected mp3s via its itunes desktop jukebox? The popularity of the ipod is so great that even people who do not own one themselves still store and manage their songs through the itunes desktop jukebox.
So do you blame the creators of illegal download services or the companies which gives illegal content a safe haven to be stored and shared without limitation.
If someone had forseen this disaster coming they would have lobbyed on behave of all intellectual property owners for one interoperable drm system between portable players which would not accept downloads that did not contain the proper protection I’d, such as a passcode.
With EMI jumping into the drm free arena, it seems that Jobs decoy finally payed off. For one, by allowing labels to remove drm from is catalogue while still keeping them in the restricting AAC format , helps increase the need for storage and managment via the ipod, and two, premium price tags does nothing more than encourage users to obtain free non-protected files via cd ripping and illegal services because they are part of young digital culture trained to still enjoy low fidelity audio files. It kind of seems like EMI is going backwards against its own cause, and Jobs is laughing straight to the bank.
But we must applaud the effort and bold moves of change, though Universal played possum well and found a more sensible path.
In the end, content storage and management reigns supreme because nothing beats ownership, especially when its comes to you free of charge.
Kay France
kayfrance[@]tmo.blackberry.net