EXPERT WITNESS: The economics of music (continued)

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(continued)

“You Can’t Lose with the Stuff I Use”
– Reverend Ike, Television Evangelist



Unabated consumption of music appears obtainable only at the times in our lives when we have the money and the time to indulge our tastes in the element that bridges the space between Earth and Paradise. As uttered repeatedly in recording studios around the world, “Money is time and time is money.” Like the energy and matter that is transmutable through Einstein’s equation, we may find ourselves constrained by having a limited amount of both. Therefore, the finite barriers of time/money may preclude the attempts to maximize our sense of pleasure through the enjoyment of music. No longer are we the masters of our fates. In our material world of time and space, we remain subject to the limitations that time and money place upon us.

Therefore, we must ask ourselves the following question: How much time and money do audience members need to spend, given the price of a recording or a live performance? The price that a music lover is willing and able to pay remains relative to the amount of time and money that s/he possesses in respect to the price commanded for other recordings or performances that one may enjoy. As a result, price exists as a quicksilver substance. The monetary amount emerges from whatever current bidding determines as the price in respect to what the market of consumers will bear. As long as music remains a fleeting ride upon the air currents, little intrinsic value can exist. The value of music performed rests with what is created within the listener--momentary pleasure and subsequent memories. Therefore, we can define the value of music only upon its existence as intellectual property and the inherent legal rights attached to it.

For an illustrative example, let us consider Woodstock: “An Aquarian Exposition: 3 Days of Peace & Music” that finally settled in Bethel, New York in 1969. This third prospective site resulted from Woodstock Music and Art Fair promoters being barred from earlier negotiated sites. The 3-day ticket price was $18. This price, adjusted for inflation translates to $123 in 2018 dollars. For perspective, a recent concert by David Byrne (Talking Heads) at the Fisher Theater in Detroit charged $350 per seat for an upfront location.

Two days before the music at Woodstock, the fences and ticket booths were not in place. However, 50,000 ticketless fans were camped in front of the stage. By the time that the festival for 500,000 guests was over, the Woodstock producers were $1.4 million in debt and faced 80 lawsuits by local landowners and others. Fortunately, the hit movie of live concert footage reduced the initial debt to $100 thousand. Additional recoupment of losses came through the sales of the live recordings. For further background reading, see “The Road to Woodstock” by Michael Lang (Ecco, 2010).

The music monger may attempt to set the price by the amount of pleasure and pain that the market will bear at any given time. Market bearance is subject to the disposable income that is possessed by music buyers. It represents the amount that they are willing to relinquish for one selection in respect to available close substitutes. Often, his/her decision arises subconsciously in respect and deference to all of the other necessities and comforts of life for which s/he must allocate a portion of his/her available budget. The market will bear a price that is subject to the amount and intensity of desire that is aroused in the listener. Through this two-way process, the music must draw purchasers to give up a portion of their budgets that they allocate to their consumption of the aural art. Furthermore, the product may seduce the music lover into a reallocation away from the purchase of other goods and services needed or wanted.

Therefore, the creator and purveyor of the music product assumes the task of arousing a great desire within the listener. S/he does this in such a way that narrows the purchasing focus to the music that may grant the greatest pleasure available to the buyer for the money. The music creator/purveyor interacts with the listener in order to draw out a sense of knowing that a specific recording or performance will bring forth the desired pleasure. On the other side of our proverbial two-headed coin, this pleasure must be obtainable, given the ability and willingness of the buyer to relinquish a portion of his/her wealth or income in order to satisfy an internal desire. Due to the transitory form of pleasure that is derived from music, the “knowing” within the listener accumulates in respect to repeat-exposure to specific artists or pieces of music. The listener might accept other artists or material as substitutes for which s/he offers time/money. Therefore, the transaction between music purveyor and purchaser must be done with honesty and respect, avoiding any chicanery or manipulation, since malfeasance will not endure over time in a highly competitive market. As a point of fact, how many of us who are not “music geeks” even remember the names of “one-hit wonders”?

In contrast, we tend to remember and to continue to listen to those artists with whom we have developed a cumulative relationship across succeeding decades. This developed relationship motivates us to attend concerts on a regular or semi-regular basis and to replace worn-out twelve-inch vinyl with technologically advanced copies in the form of CDs, downloads, and hi-def vinyl. The value of music increases through the repeated interaction between creator and listener through a relation sympathique that develops and augments between the minds of the two parties over time.

Of course, the transitory sale of music continues along alternate avenues as the music industry parades lines of manufactured one-hit wonders in front of us like cattle at an auction. Due to the relative enormity of the underlying fixed-costs in the creation and communication of music to the public, these fleeting relationships produce meager long-run net value in either financial or pleasure terms. These “dark forces” intermittently dominate the music industry. The executives behind them fail to understand that, for many listeners, this connivance develops and sustains an air of distrust that eventually drives the listener elsewhere in search of his/her satisfaction. At its core, the enduring conveyance of music from creator to listener remains a matter of relationship-marketing rather than product-marketing. In a product space where nurtured relationships reside, listeners come to trust specific creators, looking to them for the sound capable of heightening and sustaining the level of musical pleasure. Hence, relationship-marketing inherently involves repeat business.

Takeaway

The temptations of our Consumer Culture continue to challenge most of us. However, the lessons that we can learn from the world of music, which lead us to grow in wisdom and knowledge, prove invaluable for our development in other fields. What I (Dr. Sase) have learned from the Practice of Music has translated into my Practice of Economics. We hope that these same lessons help fellow musicians who have pursued careers and have built practices in Law.

Controlling costs is vital to achieving our goals. Though years of textbook study of Law, Accounting, Finance, Economics, and related courses may help us to refine our skills, our core abilities remain intuitive as they are based upon our fundamental beliefs, traditions, and philosophies of life. In this time of economic and political uncertainty and instability, lessons learned early in life may help us to survive and to persevere. Never give up! Never surrender!
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Dr. John F. Sase teaches Economics at Wayne State University and has practiced Forensic and Investigative Economics for twenty years. He earned a combined M.A. in Economics and an MBA at the University of Detroit, followed by a Ph.D. in Economics from Wayne State University. He is a graduate of the University of Detroit Jesuit High School (www.saseassociates.com).

Gerard J. Senick is a freelance writer, editor, and musician. He earned his degree in English at the University of Detroit and was a supervisory editor at Gale Research Company (now Cengage) for over twenty years. Currently, he edits books for publication (www.senick-editing.com).

Julie G. Sase is a copyeditor, parent coach, and empath. She earned her degree in English at Marygrove College and her graduate certificate in Parent Coaching from Seattle Pacific University. Ms. Sase coaches clients, writes articles, and edits copy (royaloakparentcoaching.com).