Hallelujah — a Yahoo music exec who gets it

Thanks to Mike Arrington of TechCrunch for pointing me to a post by Yahoo vice-president of product development Ian Rogers. In the post — entitled “Convenience Wins, Hubris Loses” — Rogers recaps a recent presentation he made about the business of digital music, and as Mike notes it is well worth reading.

The Yahoo VP — who used to run the pioneering music company Winamp, after dropping out of university for a year in 1995 to tour with the Beastie Boys — describes the early days of the digital music game, and his surprise at the combination of fear, ignorance and loathing with which the music industry greeted the arrival of mp3s and services such as Napster:

“We were naive to be sure, but we were genuinely surprised by the approach. Suing Napster without offering an alternative just seemed like a denial of fact. Napster didn’t invent the ability to do P2P, it was inherent in TCP/IP. It was like throwing Newton in jail for popularizing the concept of gravity.”

Fast-forward to today, and Rogers talks about how Amazon has finally created a music-download service that is actually as easy to use as a p2p network — in fact, easier. Unfortunately, he says, it has taken eight years of wasted effort and millions of dollars in legal fees:

“8 years. How much opportunity have we lost in those 8 years? How much naivety and hubris did we have when we said, “if we build it they will come”? What did we spend? And what did we gain? We certainly didn’t gain mass user adoption or trust, two prerequisites to success on the Internet.”

As Rogers puts it — before describing the ridiculously convoluted process you have to go through to buy a track and download it through Yahoo Music — “Inconvenience doesn’t scale.” If there is one lesson the music business needs to learn, it is that. It’s true that Apple’s iTunes service has grown to a phenomenal size despite the use of proprietary DRM controls, but think of how much larger the audience for that music could be. As Rogers puts it:

“Platforms which monetize the gigantic scale of the Web are the only way to compete with the control you’ve lost, the only way to reclaim value in the music industry. If your consultants are telling you anything else, they are wrong.”

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