Arnold - your own comments posted last week don't sound too different from what Jobs was saying.

"Even today, music and book publishers are like venture capitalists, with lots and lots of failures made up for by the occasional big hit."

My intuition is in agreement with this week's Arnold Kling. Clay Shirky says it better, but costs in content industries fall in three categories -(a) production, (b) promotion, and (c) distribution. Technology is rapidly driving down the costs of (a) and (c). Item (b) - all the money which the industry spends (including payola) convincing us to buy a CD from one artist instead of another - is a consequence of the current industry structure, not an indispensable function worthy of subsidy.

I do believe that there are very few big hits relative to the number of albums released or books published. But I don't think that each new artist or writer gets a big advance.

In any case, it would not surprise me to see on the Internet a model with fewer big successes and more moderate successes--but still a whole bunch of artists earning close to nothing, because that's the way the supply curve in that industry operates.

I think the real point is that, more and more, the record industry is like a toll road where most of the revenue is consumed by the toll-takers and very little goes to road construction.

Arnold, when it comes to new artists, yes they do not get big advances. But there are considerable costs in studio time, studio musicians, and studio personnel. Take someone like Britney Spears or Christina Aguilera and look at how their first albums were done. They didn't have their own bands so studio musicians were paid to play on their records. Various writers were used to produce material (not sure if they got paid anything other than royalties though), and assorted people did production work on the recordings.

As for the new electronic means of distribution obviating the need for big marketing staffs: Well, how many big hit artists are coming up outside the realm of the big record labels? What is unique about music that makes it less in need of marketing in the era of the internet as compared to, say, cars?

If the record companies are so incredibly inefficient then we should see big successes coming from artists who never signed a contract with a record label. After all, there's the internet. Maybe that will happen some day. But so far I do not see it happening very often.

I went to AI Northeast College Of Art And Communications. I spent close to $60,000 taking out loans from the goverment. I spent countless hours in and out of class. Studying my brains out and working all night on projects. What did this give me at the end of my scholastic career? Nothing but a financial headache. I still have not found any work in my field, and I have creditors calling me daily. How the hell is anyone suppose to make a living in this field, without having to do menial labor and clean up duties. I didn't go through with my college education to wind up doing maid chores. This " totem pole " tactic totally turned me off from ever getting involved with another recording studio intership. Fuck that bullshit! I can do whatever the old timers can do (who are too afraid to let a young rookie take over the control position). Too frightened that a new generation has a trick or two up thier sleeve, mabye they haven't thought up yet. Getting fat and lazy behind the audio desk, without competition or a higher turn-over rate for the job in question.
A wake up call to a scared industry who is about to have the rug pulled out from underneath them. Let's turn this industry around. Go on and put some new faces in the studio. Go on! We dare you! Look around and be aware! The youth will overcome you and your out dated industry!