Geoffrey P. Hull
The Recording Industry

(New York and London: Routledge, 20042, 335 pages)

Review by Tim Wall

As the title suggests this is a comprehensive study of the recording industry, with a bias towards its largest national formation: record companies operating in the USA. The detail of both the global industry, and the US industry this study uses as a defining subset, change so fast that 1998’s first edition needed substantial updating. The emphasis here is on copyright as the source of recording industry economics, and on other media – in particular the internet – as the arena in which these legal and economic factors are played out. Geoffrey Hull identifies the Digital Millennium Copyright Act as a pivotal moment, and argues that the act is a response to a new era of music distribution. He offers his analysis, unapologetically, as an economic one; and argues that economics allows us to understand how three streams of income – publishing, live music and record sales – have become dominated by the activities of the recording industry.

The early chapters provide a detailed description of the administrative basis of copyright in the US, and the practicalities of its legal organisation. There is a useful historical dimension, and case studies of key court cases that have established case law in the field of musical rights. The book also gives some clear ideas of how record companies acquire rights, and exploit them as income streams, and how performing and mechanical rights are organised institutionally. It helpfully explains the ‘circled c’ and ‘circled p’ forms of copyright iconography to be found on the artwork of CDs and tapes.

Later parts of the book leave the issues of rights behind to look at how other music-based activities generate income, and how these areas are organised structurally, both at a generic level, and in their major and independent formulations. The common thread of this analysis is the legal relationships which are created between the participants, and some description of the scale of the financial activities of the industry.

There is certainly much to be gained from reading, and owning, this book. Although statistics date quickly in this field there is a wealth of information for current scholars and for teachers in the field. It is certainly a book that every academic library should stock. The precision and clarity of the book are great virtues. There is no doubting the comprehensive scholarship that went into its production. Equally, the basic idea of the centrality of rights, the importance of income streams, and the functioning of the recording industry organisations in the US, are insightful. The later analysis of the challenges of the internet engages with the main issues that have been circulated in the media, and which concern record companies most. As you would guess, Napster and internet radio get useful explanations and helpful contextual discussions.

The book does, however, raise a number of interesting questions about how we study the music industry. My own attempts to find accessible ways through the complexity and variety have taught me that there is no one, simple answer, and the more approaches we have the more we will understand. Nevertheless, I would like to explore a number of issues characteristic of Hull’s approach, which I hope will stimulate thought about how we should conceive the music business as an academic study.

First up is the question of what to call the object of our study. For Hull it is the recording industry. This terminology has the great benefit of emphasising the central importance of recordings (the noun) within the industrialisation. This is a point made by Simon Frith in his now classic critique and theorisation of popular music scholarship [1]. However, Hull uses recording as a verb. I am not convinced that what is at stake here is the process of recording music. Although, of course this is certainly worthy of analysis. Neither is Hull committing the error, identified by Frith, of believing music is something that exists before the process of recording it. He clearly shares the view that our central focus should be on sound recordings, as artefacts that can be sold and as texts which have cultural meaning, because they generate (still) the majority of the music industry’s income. It is, though difficult to know what to call these collective institutions. I tend to use the term record industry, because to me vinyl, CDs and MP3s are all records, and we should have our focus on the economic relationships built around recorded sounds. Of course, to many records are only vinyl seven inch and twelve inch artefacts, and so for them the term relates to a form of distribution, not a form of economic activity. On the other hand the music industry is explicitly too broad for Hull’s analysis, because he (rightly in my mind) wants to understand how the trading of recordings has come to dominate all other music-related economic activity. Even given my lack of a consensual alternative, I’m not convinced using the term ‘recording industry’ provides us with the necessary clarity.

Second, I want to ask if Hull’s analysis really is an economic analysis? This might be a pedantic quibble, but it seems to me his approach is more of a legal-financial one. Hull’s background in practical law is a great bonus, especially for his detailing of the sorts of considerations that a legal advisor would need to have to hand, and his mapping out of the financial scale of aspects of his study is helpful in supporting his claim to its significance. However, economics aims to give a deeper insight. For the economist rights are not simply legal certainties which govern the behaviour of corporations, or the protection of their rights entrenched in the properties they own. Rather, they are the means through which certain types of labour – signing, developing and promoting stars, and making and distributing recordings – are made more profitable by turning them into capital that can be owned and exploited. In other words economic analysis is not simply about financial realities, but about the fundamental structures which generate and distribute wealth. These latter approaches allow us a greater depth than that offered in Hull’s account.

This is related to the third point I want to make. While for a legal professional the laws and practices of rights are details to be mastered and understood, for the scholar they are social practices to be explored. Copyright, and its associated rights, are some of the most complex areas to fathom in pursuit of a grasp of the record industry, and they provide the key to understanding wider contemporary entertainment business practice. In part their complexity is the product of shifting function, power relationships and cultural ideas. As Frith and Marshall et al have successfully shown copyright is not simply a set of laws that constrain the right of people to copy the sounds encoded on records [2]. Economically, these rights may allow individuals or corporate bodies to create capital assets that can be bought and sold, and exploited through the application of labour, as income streams. In legal terms the rights have developed through the extension of concepts from one era to another. In particular the royal-ascribed rights of European printers to make copies in the eighteenth century, were extended to printed music in the nineteenth, and then to recorded music and its distributive artefacts in the twentieth, and more recently to digital copies of the same sort of recordings previously used for ‘three dimensional’ artefacts [3].

According to Hull’s discussion, copyright law will merely need to evolve to the new circumstances of digital streamed and downloaded music carriers faced by the recording industry. This is based on his proposition that “a core purpose of copyright law in the United States has always been encouraging authors to create works that are for the general benefit of society, by making it possible for them to make a living from so doing” (265), and the view that it would destroy professional music making. This is certainly the argument most often made by industry representatives in copyright cases [4]. However, this ignores the radical changes that digital technologies have wrought on the record industry. I wonder if Hull’s valuable part in establishing the recording of popular music as a profession worthy of serious study – for which we are all indebted – is distorting his understanding of the implications of these changes. The advent of digital forms distributed by wired and wireless networks will undoubtedly undermine many of the assumptions on which the notion of ‘the professional recording industry’ is based.

The record is important to the economics of the music industry, not only because it made it possible to capture the sorts of individualistic performance which became the basis of the aesthetics of popular music, but also because it allowed entrepreneurs to control the distribution of pieces of music, and capitalise their investment in recording and distribution. Copyrights allowed these entrepreneurs to charge for the music that was distributed, rather than simply the labour of that distribution. Artists sign over the rights that subsist in the music they ‘produce’ in order to benefit from the record companies ability to distribute records. In return they usually receive royalty for each sale. They rationalise that a small percentage of a lot is better than 100% of the very of the little they could achieve by their own labour. Artists have traditionally believed they need record companies to produce, reproduce, promote, and distribute recordings of their music. Of course these are all processes that Hull details, but he does not bring out the economic implications of them in such a way that they can be the basis for understanding current changes in the industry.

The fundamental point here is that digital technologies lower the capital costs of all these activities many fold. It is in these economic shifts that we can understand how online music is likely to relate to the changing role of the record industry. For major companies star-building is currently an economic act of capital-investment to be set against the income streams that can be expected from record sales from people who became fans of the star. In this sense the record industry views the economic value of promotion they gain through, for instance, radio-plays of their records, is much greater than the loss from lowered sales because these radio-plays offer an alternative source of the music they sell. Although this is now a widely held view, the history of the relationship between radio and record companies shows this lesson took decades to learn. By contrast the Digital Millennium Copyright Act (DMCA) has as one of its assumptions that the digital file of a recording streamed on an internet radio station is identical to the one they want to sell. Therefore their traditional logic tells them that the promotional value will be less than the loss to sales.

In this context the DMCA is less an adaptation of law, or the protection of property rights suggested by Hull, and more a lack of entrepreneurial imagination. For if anything, the digital and internet forms of distribution turn the economics of the record industry on their head. The threat is not that consumers will obtain identical copies without paying, but that the economics of recording, promotion and distribution no longer provide them with oligopolistic power. Major companies are slowly learning that they need to make the commodity out of those aspects that used to constitute the promotion (live appearances, merchandising, media appearances) because they still control their distribution, and the former commodity (the recording) now needs to become the promotional tool because it is freely available. In fact as Chris Anderson has observed the future of the recording industry may well be in the ‘long tail’ of small incremental sales, and not the shining comet of income from high cost stars [5]. To an economist this is the recognition that we have moved from a high fixed cost low marginal cost industry to a low fixed cost medium marginal cost industry. Now, rights have a very different value, and the creation of new products that can be marketed become less important than the control of rights that can be exploited.

So, overall Hull has provided a detailed analysis of the record industry in the US as it enters a period of major change. Its insider’s position is revealing and thoughtful, and its knowledgeable legal-financial perspective gives us lots to think about. However, it often just describes what is happening, and reproduces what has been the dominant industry view. We need a wider sense of how business relates to culture, and how economics relates to law. This is definitely a book for the short loan section of the library perhaps, but not for the long term.


1. Simon Frith, 'The Industrialization of Popular Music', in James Lull (ed), Popular Music and Communication, Sage: London, 1992.
2. Simon Frith and Lee Marshall, Music and Copyright, Edinburgh: Edinburgh University Press, 2004.
3. Martin Kretschmer and Friedmann Kawol, 'The History and Philosophy of Copyright', in Simon Frith and Lee Marshall (eds), Music and Copyright, Edinburgh: Edinburgh University Press, 2004.
4. John Alderman, Sonic Boom : Napster, Mp3 and the New Pioneers of Music, London: Fourth Estate, 2001
5. Chris Anderson, 'The Long Tail'. in Wired, October 2004

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