40,000 Songs Per Child

I remember my music collection as a young teenager. It mainly consisted of CDs that I got from signing up to Columbia House or BMG’s CD delivery service. I had more CDs than most of my friends. I’d say my total collection was about 50 CDs. That’s roughly 600 songs. That wouldn’t even fill up a 10GB iPod.

Now you have people of all ages carrying around over 50 GB in their pocket. Apple’s 80 GB iPod stores 40,000 songs! Please remember this when the music industry gives you their sob story about how their losing business because of piracy. They brought it upon themselves for reaping the profits of this mass consumption of their product without listening to their consumers (Apple had to pull teeth to get them to charge $1 a song). They could have avoided their current losses if they actually provided the consumers what they wanted ten years ago when MP3s were becoming popular.

Note to TV and movie studios: Make your content as accessible as possible and sell advertising (like what you’re doing with Hulu). Don’t make the same mistake as the music industry and try to milk the consumer for as long as possible.

Bringing Down the Music House

I just finished the book “Bringing Down the House” which chronicles the infamous MIT Blackjack team. For all who have never heard of this team, they were a group of MIT students who used a method of counting the high and low cards that are dealt at the blackjack table to give themselves a statistical advantage over the house (about 2%). They raked in a few million dollars over the course of a few years before many of them were caught. This was just one person’s story and these teams had been around for a long time and supposedly are still around. The book was an enjoyable read and I recommend it. The part of the book that I found most interesting was the discussion of the psychology of the game in the player’s mind. Let me explain.

The casinos have a statistical advantage in Blackjack. It doesn’t make a difference if you play every hand perfectly. Over time, you will lose. If you count cards (which isn’t illegal but the casinos can kick you out for doing it), and you increase your bet at the right moments, then you can gain a slight statistical advantage. Casinos want to kick card counters out. I would too. But casinos have gained tremendously from the card counters. Now everyone thinks the game can be beaten. Sure, you have to be extremely good with numbers and spend hours of practicing, and even then you might not get it right. But if people think they can beat the system, then they’ll play more. So while the casinos should kick these guys out, they should also recognize the advantages they receive from the card-counting culture.

This reminded me of the current state of the music industry. It’s all about an us vs. them mentality. The people who make the music vs. the people who download it illegally. What the music industry fails to realize is that without the pirates, you wouldn’t have millions of people walking around with 30 GB of music in their pocket. Who could afford that much music? Word-of-mouth marketing is so important in the music industry. I download an album for free. I tell a friend who tells a friend who tells a friend. Eventually, someone who isn’t so familiar with torrents will download that album from iTunes or AmazonMP3. This is a person who never would have bought this album otherwise. This has been happening for years now and that’s how people have so much music. Mostly downloaded for free, a few paid for. The music industry can keep on trying to go after pirates, but they need pirates. Possibly, if this was somehow acknowledged by the music industry, they might find a business model that works for everyone.