1. The best approach is slow and cautious. Right now, we are in the jungle. In the jungle, you don’t rush blindly ahead. You dip a toe in the sand, and see if you sink. We have no hope of predicting which of these services might catch on. We need to move slowly, with very short-term agreements and see what works and what fails. And we need to be sure not to undermine our other business partners while we do that. Which leads to…
2. We should support our allies and punish our enemies. Rob McDaniels for InGrooves estimates that it takes 150-200 streams of one song to equal the royalty income on a single download. Right now, our industry still relies on the sale of physical product (believe it or not, it’s still the primary source of revenue) and on digital downloads. Perhaps streaming is the future. Perhaps not. But we would be very unwise to cut ridiculously low-cost rates to a business model that obviously threatens both physical retailers and iTunes. Let’s take care of the people paying our bills. At the same time, we should continue to press ahead with legal efforts against things like Pirate Bay– efforts that are finally starting to show some results.
3. We need to recognize that “bundling” and ad-revenue sharing is a marriage, and it works both ways. If we bundle the cost of music access into the cost of a mobile phone or the sale of a computer, we’re now not only in the music business, we’re in the electronics business. Any economic factors that hurt the sales of phones and computers will now hurt us as well.
4. Most of all, we need transparency in the negotiations and setting of rates, so that everyone in the music community understands what they’re being paid and how it’s being calculated.