Oct 09
9
Music Industry Revenues and ROI
I had an interesting conference call earlier today with several people in the US who are all in the music industry. I can't say who they are, since we are under NDA.
They are raising money for a new venture in music. I am providing some advice on the business plan.
I offered some advice on modifications to the plan that I think are going to be necessary which they are happy with.
One of the things that I suggested was that they need to put out front and centre why the music industry is a good potential investment for high net worth investors, in the light of the continuing news speculation about how much impact piracy is having on the industry.
I said, “We need to be able to explain that revenues will go up, in spite of so called Internet piracy”.
The response was, “I had a meeting with xxx and yyy today from companies aaa and bbb and they are telling me that their revenues are up for the quarter and continuing to grow, so that is accurate, but we can not discuss who because it is in confidence”.
Sorry that I can't reveal who, but I think that I can say reasonably categorically, that inside the board rooms of the music industry they are happy with the revenues.
They are now playing this, to my mind, rather intriguing game, where in talking up piracy, they appear to be actively trying to discourage casual investors from getting involved. Now in a private company world that could be a strategy for reducing competitiveness, but in a public company world where the consumer is also the shareholder is also the investor, you would think that this might be a wee bit counterproductive….
There is no doubt in my mind that the music industry is not being harmed by downloads. It may not be getting as much revenue as it would like. But then junkies probably never get as much dope as they would like, and sex fiends never get laid as much as they would like…. you get the picture.
Some people want a good return on investment. And some people want outrageous returns… Copyrights are still a great place for a good return on investment….