Online audio rocks the music industry

The British singer-songwriter-composer Monc may or may not be the next big thing in popular music, but what he is doing is already enough to scare the living daylights out of the established recording industry.

The British singer-songwriter-composer Monc may or may not be the next big thing in popular music, but what he is doing is already enough to scare the living daylights out of the established recording industry.

He doesn't have a recording contract, nor does he want one. He hasn't been inside a big-company studio in years. Instead, he has his very own digital recording system in his living-room just off Laurel Canyon in the Hollywood Hills, makes his own CDs, and sells and markets himself exclusively over the Internet.

"I can do everything that a big record label would do, for a tenth of the cost," says the 31-year-old musician, a veteran composer for British television documentaries and performer on Saturday morning shows like Tiswas. His self-titled debut album, a technically accomplished blend of trip hop, jazz and retro glam-rock sounds, has been available online for a couple of months, and is already attracting radio airplay and Internet chat traffic despite little or no marketing.

"The only thing I need money for is promotion, and I'm lining up a group of investors from the UK to do that for me," he says. "The big labels are completely constipated at this point. They are dinosaurs, moving way too slowly. We are getting to our fans directly in their living-rooms." What makes Monc's ambitions possible - and those of dozens, if not hundreds, of aspiring recording artists like him - is the advent of several pieces of computer technology that, in one form or another, are almost certain to revolutionise almost every aspect of the way music is produced and consumed over the next few years.

His studio - a powerful computer with mixing software attached, a sound- proof box for laying down vocal tracks, an electronic keyboard and a drum kit - cost around £20,000 to put together, a snip compared with the price of cutting just one album in a professional setting. His website, which features lots of cool graphics and gadgets including a "virtual" studio enabling websurfers to compile their own rudimentary remixes, is the brainchild of his partner, an arts school graduate called Dr Atomic, who has put hundreds of hours but little or no capital investment into the project.

From the consumer's point of view, the key developments are the advent of compression technology enabling the music to be transmitted over the Internet at a manageable speed, and the proliferation of playing devices to decode the compressed files and play them at CD-quality levels. The pioneering compression technology, known as MP3, has revolutionised music among the young. Since the technology is free and very flexible, there is nothing to stop individuals, websites or record companies from posting pieces of music online and letting the whole world download them - for money or, more commonly, free.

Over the past two years, MP3 files have been whizzing through cyberspace at ever-increasing speed. This has created new marketing opportunities, as record companies have released "bonus" tracks as free promotions online and started investigating ways of selling music over the Internet. David Bowie, for example, has already built up a whole online marketing strategy around his forthcoming release, hours.... The album will be released in its entirety over the Internet next week, two weeks ahead of its scheduled appearance in record stores.

But the MP3 craze has also got record companies panicked because unlimited quantities of music are being trafficked illegally. If hit records by big-name acts can be found free of charge online, and new bands are thinking of bypassing the established record industry altogether, the business may not just be facing a future in which computer downloads replace the CD, it may not be facing any recognisable future at all.

The "big five" record companies - the Universal Music Group, BMG, Sony, EMI and Warners - have clubbed together with a consortium of technology firms to produce the so-called Secure Digital Music Initiative in an effort to limit piracy. They have also thrown themselves into partnerships with high-profile computer companies such as Microsoft, AT&T and Matsushita to try to develop strategies for dealing with the new marketplace.

Part of the panic, according to musicians attracted to the new online possibilities, stems from a growing crisis within the industry. The music business has had much of the liveliness and diversity sucked out of it in recent years as big media conglomerates have bought up the main labels and grown increasingly conservative in their selection of bands and material.

Music consumption among 20- to 24-year-olds has dropped by a third in 10 years, says the Record Industry Association of America, as the music has become blander and controlled by fewer and fewer interests. For fans looking for something more challenging than the Backstreet Boys, the Internet represents more than just a chance to acquire music for free; it also enables them to find artists following their musical instincts in a way that has not been possible for years. "The music industry as it is today is a banking system, it's not about art. They'd sell a hubcap with cheese on it if they could," says Chuck D, leader of the rap group Public Enemy, which recently abandoned the traditional industry to release an album online. "It's like this: There's a fat guy on a street corner selling M&Ms to all the people waiting in line, he's making all the money, and they're not happy about it. Then the bottom of the bag rips, and the candy goes all over the sidewalk.

"What are the people going to do? They start grabbing it up, and he's standing there saying, 'No, wait, that's my candy!'" Bands which failed to find a label because their sound was not considered commercial enough, or which fell victim to one of the recent mega-mergers, can find a new lease of life. And if they start off giving their music away free, it probably does them nothing but good in the long run. A study by Forrester Research Inc shows the proliferation of pirated music on the Internet is actually boosting music sales because of its promotional effect. The punk band Offspring believes there have been 18 million illegal downloads of its songs, but it also sold eight million copies of its latest album. "If that ratio holds up," said the band's manager, Jim Guerinot, "I want 36 million downloads so we sell 16 million albums."

The proliferation of online music, legal and illegal, is only likely to intensify with new technological advances. Already, the old MP3 system is looking outdated, being replaced with systems called Liquid Audio and a2b Music. Monc uses a Canadian software package called Q Design that enables him to download a song in 15 seconds, compared with three or four minutes with an MP3 player. The record industry remains divided on whether the Internet is a threat or an opportunity. Big record companies are well placed to take advantage of their marketing muscle and move at least some operations online. In other ways, they have grown too unwieldy to generate new talent with the speed and spontaneity of the Web. The CD, say the techno-wizards, has about 10 years of shelf-life left in it. And after that, it's anybody's guess.