360 Deals Are Giving Up Not Growth

The influential blogger Michael Arrington wrote a post yesterday in support of Edgar Bronfman's edict that all new Warner artists sign 360 deals.

Bronfman also said that 360 deals give labels the ability to give away music for promotional purposes to spur event and merchandise sales. And that, for me, is the key. Bronfman, an outsider to the music world until recently, sees the writing on the wall - music downloads will eventually be free, and will serve as little more than marketing collateral to other revenue streams. 360 deals give labels a place in the new music economy, and there’s nothing wrong with their attempt to keep their businesses alive over the long run.

360 deals are a desperate reaction to cataclysmic change and those who support them are short-sighted. These deals do nothing to grow the industry - they only cut a small pie differently.

All of the ancillary revenues around recorded music - ticket sales and merchandise - will never even be close to recorded music sales at their peak. Giving away music to grow this revenue stream is giving up.

Growth can only be found in selling the time spent listening to recorded music.