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Gateway as Content Distributor? 181

Posted by timothy from the things-change dept.
crovira writes "CNet has an article about Gateway testing the waters of the music business and using their retail stores as music outlets." crovira excerpts: "So far, Gateway executives have not specified exact plans that the company will pursue, but they have indicated that it could position itself as a conduit for content from established and new artists. Turner also indicated that Gateway is contemplating bypassing the titans of the music industry if necessary. 'We have retail stores that aren't beholden to the music industry,' Turner said. 'There are a lot of artists out there.'" Makes one wonder if the xxAAs will roll-over and take their tithe or if they'll try to find some anti-competitive legal maneuvering leverage to keep Gateway out? And can Apple be far behind with video services out of their own retail outlets?"
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Gateway as Content Distributor? More

Gateway as Content Distributor?

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  • ...given the image of the company, is it all going to be pirated barnyard music?
  • great, so i can pick up a new gateway with a cdr and cd-ripping software, all the while looking around the store for music to remember to go home and download so i can burn it later! awesome!

  • Now you can... (Score:5, Funny)

    by Zen Mastuh ( 456254 ) on Monday April 29, 2002 @11:39AM (#3429214)
    1. Listen to music geared toward the Lowest Common Denominator
    2. on a machine geared toward the Lowest Common Denominator.
    Neat.

  • Kinko's is the most logical content distributor beholden to no media giants. Too bad, as they seem to have lost their adventuresome spirit over the past few years.
    • Not true Kinko's won't let you copy more than a few pages out of any book for instance. In fact they have all sorts of strange copyright rules.

      The worst part is, they won't even let you copy a $100 bill. 1's and 5's seem OK though.

      • Re:kinko's! (Score:2, Informative)

        by 1024x768 ( 113033 )
        They have some funky rules about fair use. But that doesn't mean they are beholden. It means they got whacked a few years ago: http://fairuse.stanford.edu/primary/cases/c758FSup p1522.html (wrapped url, take out the space)

  • new business model (Score:2, Interesting)

    by tcm614ce ( 570300 )
    Maybe since Gateway is in the tech business, not the record business, they will be able to come up with the business model that can make money for themselves and [their?] artists with new technology.

    • Re:new business model (Score:5, Interesting)

      by johnjones ( 14274 ) on Monday April 29, 2002 @12:31PM (#3429478) Homepage Journal
      yeah its called streaming

      wake up Video + music will be on a server and you select what you want when you want it

      the tradtional ISP is gone as soon as the Mobile networks have enough bandwidth to do Video

      that way if you have a TV/STB then you put in SIM chip and recive what you want paying for rentels via sim(what we think of as the phone)

      and if you want music plug in you earjacks into phone and away you go

      I have not seen a single new phone (based on OMAP) that cant do streaming MP3

      its only a matter of time until the networks (mobile) work out this revenue generator and kick the cable co/baby bel/incumbant ARSE

      muh hahaha

      regards

      john jones

    • The xxAA's onky exist because of inertia. And they are the heaviest contributors to this inertia.

      They have fought (and lost) against EVERY technological device since the invention of the player piano. They have NEVER won. Not even ONCE.

      And the people who were supposed to benefit from this went around them and founded entire industries around the products that were supposed to bring doom and desolation to the industries they were alleging to protect.

      The industries who need protection need protection from the xxAAs not the technology. That technology has in EVERY case turned into a profit center for somebody in the industry.

      I suspect that the fight will now be brought back home to the xxAAs since they have NEVER won a case but instead have stood at every turn between people and profits.

      The xxAAs are about as useful as a dose of clap and about as pleasant. Cover Jack Valente with Piperazine and he'd wither away like a slug covered with salt.

      The xxAAs put music and ads in elevators. But its such an abomination that its called "Muzak." Muzak is to music as a can of dog food is to a steak.

      Some people prefer chicken. FINE... But THEY get to make the choice of their meal.

      Most music is of the Muzak variety. If bought by people who don't like it and don't listen to it but have been sold on structured noise as a background. Its part of an architectural motif on par with the plastic chairs in airport lounges and its about as comfortable to be around.
      Personally, I prefer silence. And its FREE!

  • Deathmatch (Score:4, Interesting)

    by DCram ( 459805 ) on Monday April 29, 2002 @11:40AM (#3429220)
    the great thing is Gateway has enough clout to pull this off. And the more holes Gateway puts in the wall the more cracks smaller guys can squeese through.

  • But I am thinking gateway will fall flat on thier face with this one. I don't think people will run to the the Gateway store to buy MP3's of music they never heard of. The RIAA mafia robly be effective in theatening any big-name artists from doing business with gateway. Finally they will get sued, meaning a whole lot of hassle to only serve a few users. Maybe a few small indy artist will end up getting record contracts as they are stolen from Gateway.
    Frankly I would rather see them taking the money spent on this taking the RIAA to the supreme court.

    • Re:I wish them luck.... (Score:4, Interesting)

      by Erasmus Darwin ( 183180 ) on Monday April 29, 2002 @11:50AM (#3429279)
      "Finally they will get sued, meaning a whole lot of hassle to only serve a few users."

      I don't see how they're doing anything that exposes them to a lawsuit. From what I read of the article, they're only distributing music that they can legally distribute. It sounds like they're essentially a more commercialized version of mp3.com's regular service (not to be confused with the lawsuit-ridden BeamIT service).

      I suspect many artists will use this system as a way to promote their work without giving up all of their work. They could create a few freely distributable singles and allow those to help drive album sales. It would be similar in nature to one of the big pro-P2P arguments (exposure to artists/sample before you buy), but it would be done with the full consent of the copyright holder and it wouldn't necessarily result in the entire album being available.

    • Re:I wish them luck.... (Score:4, Interesting)

      by SVDave ( 231875 ) on Monday April 29, 2002 @12:04PM (#3429351)

      But I am thinking gateway will fall flat on thier face with this one.

      When my parents got a computer a few years ago from Gateway, they got their ISP service from Gateway.net . It was truly awful. The folks at Gateway obviously didn't have a clue as to how to run an ISP, but were just trying to jump on the internet bandwagon. Now my father is on Earthlink, and my mother on AOL, and Gateway.net has apparently become part of CompuServe.

      I have a feeling that this is another attempt by Gateway to experiment with the latest trendy thing. They should just stick with what they know.
  • They had a short bit about this on the show CNN Next. Included were interviews with the president of the RIAA, she was not happy at all. Basically said that Gateway was supporting piracy. Lol, what will they think of next?

  • personally (Score:4, Insightful)

    by Jacer ( 574383 ) on Monday April 29, 2002 @11:43AM (#3429243) Homepage
    i'd much rather have good pirated music, than crappy legal music..... granted people have different tastes in music, but in all seriousness, some musicians just aren't talented, i guess it's really a moot point being as i have 30 gigs of mp3s....
    • but in all seriousness, some musicians just aren't talented

      Yeah and the RIAA gives you every one of em to listen to! Go out to a pub/small club some time. I can see more talent on any given weekend here in Cleveland than is contained in the entire Billboard Top 20.
    • Hmmm...I wonder if the RIAA reads Slashdot? :-)

    • So would I. Problem is that the RIAA promotes what it thinks will make money which may not be exactly what you like. There are many other good bands and alternative types of music out there but you may have to browse to find it. I do not view the increased choices as crappy, but an advantage.

  • Conspiracy (Score:3, Interesting)

    by sketerpot ( 454020 ) <sketerpotNO@SPAMgmail.com> on Monday April 29, 2002 @11:44AM (#3429246)
    Yes this is paranoid, but perhaps the **AA would make a deal with gateway: gateway puts content protecion into their mahines, the **AA lets them be in the content distribution racket.

    Bet then perhaps we'd see a rise in people getting computers from little companies no one has ever heard of.

    • Re:Conspiracy (Score:4, Funny)

      by s20451 ( 410424 ) on Monday April 29, 2002 @11:49AM (#3429275) Journal
      Not nearly paranoid enough. Consider: Gateway, in conjunction with the RIAA, the Rand Corporation, and the saucer people, under the supervision of the reverse vampires, are forcing artists to give their music away for free in a fiendish plot to eliminate the meal of dinner!
  • ...until RIAA sends Guido over to bust Michael Dell's kneecaps. And if that doesn't convince him to back off, I'm sure the thugs will think of more... creative ways to persuade him. Pain is such a wonderful negotiating tool.
    • FYI, Gateway is run by Ted Waitt. Michael Dell runs... Dell
    • Michael had better watch out, considering he has nothing to do with Gateway (or is this the beginning of a new conspiracy theory?)... Ted Waitt is really Michael Dell... hmmm
      • You got it all wrong. Mike Dell is the *cow*. I have it on good authority that he really does do the cow voice in the commercials. Anonymously, of course.
      • "Michael had better watch out, considering he has nothing to do with Gateway (or is this the beginning of a new conspiracy theory?)..."

        While Michael Dell may not be involved with this Gateway's content distribution, it's worth pointing out that Dell seems to be doing something similar. My sister's Dell laptop came pre-loaded with a Dell Music Jukebox, which featured a handful of mp3's (including They Might Be Giant's "Older") and an option to download more songs from Dell's site.

        Overall, it looks like PC manufacturers are starting to leverage their positions the same way that Microsoft tried to. Remember the Weezer video on the Windows 95 CD? Remember the channels feature in Windows 98? These efforts seem to be similar in nature, but they're a bit better designed to fit what users want.

    • ...until RIAA sends Guido over to bust Michael Dell's kneecaps.

      But you have forgotten about the Dell Ninja Death Squad, which Dell deploys to undermine its competitors and deal with customers who call into Tech Support too often.

      Of course it doesn't matter, because the discussion is about Gateway, not Dell.

    • [Homer]

      D-oh!

      Damn, I feel silly now.

      [+1 Public Humiliation]

  • Gateway often goes against the big guys (Score:5, Insightful)

    by zoombat ( 513570 ) on Monday April 29, 2002 @11:45AM (#3429251)
    I don't have many feelings (positive or negative) for Gateway's products, but I must say I've been rather impressed with Gateway's rebellion against some big players. They've gone against the DMCA before [eff.org], and they testified [slashdot.org] against Microsoft...

    I'm not trying to say that Gateway is some sort of Utopian selfless corporation or anything, but I just have to cheer when I see big-name companies taking on the big bullies.

    • I hate gateway products. I could tell you horror stories about the computers.
      Then they go and fight for things I believe in as well. Sheesh, I'd like to buy tgere products to help support them on a philisophical level, but I can't seem to bring myself to buy there products.

      Maybe I should just wrap a 20 around a rock and through it through there window...
    • It's interesting, if they're so in-tune with what the customer (you and I) wants, why do they put out boring PCs? Why don't they do something about their reputation. They obviously aren't afraid to change, take risks, and what not, so why don't they stop using proprietary components and give me what I really want: A water-cooled, windowed, lighted, PC with a handle on the top? Or, barring that, something else that I'd like. I liked their PC TV idea years back, what happened to that? It was a great idea, and the TIVO revolution just makes it more appealing.
    • I'm not trying to say that Gateway is some sort of Utopian selfless corporation or anything, but I just have to cheer when I see big-name companies taking on the big bullies.

      I think this has more to do with the personality of their CEO than anything. Ted Waite is something of a rebel himself. One time a couple of years ago, Intel really pissed him off, so he publically vowed to change Gateway's entire line of PCs to AMD chips. Unfortunately, Gateway is a publically traded company and their stock consequently dropped like a rock the next day, so he had to take it back, and I believe they ended up switching all their PCs to Intel-only chips later on...

      Also, Waite caved in to Microsoft's pressure about the Amigas, so Gateway spun that off. But we can't really fault them for that, after all at that point in history nobody dared to stand up to Microsoft... they wielded too much power, even more than they do today (the DOJ case has [temporarily] partially defanged them.)

    • Do remember that Gateway is a company that at least used to have a license that said installing Linux voided the warranty.

      Don't assume that because they go against other companies that they will do so in a way that benefits you (or customers in general). They may. But you sure can't count on it.
    • I don't have many feelings (positive or negative) for Gateway's products, but I must say I've been rather impressed with Gateway's rebellion against some big players.

      The RIAA/MPAA picked this fight: by trying to shut down computer-based content distribution. This hits the market for tech big-time, and Gateway's products are dead-center on ground zero.

      Which makes their reaction no less impressive. Unlike (or at least ahead of) everyone else in the industry, they recognized it. And they are now staging a big-time counter-offensive, with style and effectiveness.

      Computer-based content distribution IS the next thing, both for computers and for content. Rahter than accommodating it the RIAA/MPAA have declared war on it, in the courts and the legislature. Their blitzkrieg-style first strikes (media taxes, Napster takedown, DCMA, ...) have been very effective, and flushed with this victory they became refractory, and tried to finish "conquering the virtual world" with legally-mandated hardware misfeatures that would totally destroy the hardware market and licencing requirements that would totally destroy webcasting.

      If the hardware sellers don't want their future destroyed they MUST now either bring the RIAA/MPAA to heel or break their monopoly on content and content-licencing terms. Given their orgin in organized crime and their recent success with intimidation, it's unlikely they'll domesticate gracefully.

      Gateway has recognized this, and taken on the battle with guts and style. Kudos to them.

  • By choosing the path or dirty fightying, by not incorporating new technics and new ways of communicating in they business habits, but instead going the opposite way and fighting every new actor, even the smallest (decss teen sent to court!!!), by trying to steal every new technic or channel from their creator or by trying to prevent them to exist, they made everybody sure that they are the bad guys.
    Now everybody, from the smallest to the biggest, feel entitled to try to be a big actor in this area, since the bad guys rule it.
    They shot themselves in the face. Now they look ugly.

    Will they try to change their ways or will they play even dirtier???
    The answer: Next week, same slash hour, same slash channel.

  • Gateway founder's brother started Samson Records (Score:4, Interesting)

    by K8Fan ( 37875 ) on Monday April 29, 2002 @11:46AM (#3429257) Journal

    Ted Waitt's brother Norm started Samson Music back in 1997 [archive.org]. They signed a bunch of new artists [archive.org], but then dropped them, changed their name to Gold Circle Records [goldcircle.com] and signed a bunch of 80's leftovers [goldcircle.com].

  • interesting idea, but (Score:2, Interesting)

    by z_gringo ( 452163 )
    It is hard to see how they could really succeed here. Would they sell CD's? Or would they simply allow MP3 downloads? Or would they do it all online with some Napster-like service?

    I'm all for a totally new music distribution system (and who isn't? except for the record companies). The article is a bit light on details. Hopefully there will be more information soon.

    Hey maybe one day, you will be able to call up and order you PC and have it shipped to you preloaded with your favorite MP3s!!!

    • Well, currently Gateway is a parter with eMusic.com, which is a subsription service, you pay per month (14.99 per month for 3 months or 9.99 per month for 12) and get unlimited downloads of legally provided songs.
      I'm assuming they plan on having instore kiosk, where you can purchase songs, and burn cds, and probably pre-burnt collections and albums. Currently though, I don't see the advantage of the eMusic service to mp3.com which has more artist, and is free.
  • Has a COW over this!

  • Image Change for Gateway (Score:4, Insightful)

    by Mr.Sharpy ( 472377 ) on Monday April 29, 2002 @11:49AM (#3429277)
    This and the news of their plan to use the cow against the RIAA makes it appear to me that they are gravitating toward and image change to set them apart from the other computer makers. This sort of "anti-establishment" plan could be an attempt to get the attention of all those millions of pirateers the RIAA is so afraid of. Grabbing just a portion of that market would be a signifigant win for Gateway with its recent lackluster business.

    It all makes me wonder how long it will be until Gateway sheds it's cowspots in favor of eye patches and parrots. But seriously, I wonder if we will see them installing Kazaa or Morpheus by default before too long.
  • Now every song I download from them will start with their inane jingle and that damn cow going, "Moo." Now I will never get it out of my head!!!

    I bet they are now Rosen's new poster child for the evil empire...

  • Apple as a Content provider (Score:5, Interesting)

    by danielkdwalker ( 576752 ) on Monday April 29, 2002 @11:50AM (#3429284)
    IIRC, Apple are legally unable to sell music due to a deal with Apple Music (of Beatles fame) way back when. Not sure if this still applies. IANAL
    • IIRC, Apple are legally unable to sell music due to a deal with Apple Music (of Beatles fame) way back when.

      I don't know if it's still a problem anymore, but Apple (the computer maker) could get away from it with a wholly-owned subsidiary, as long as the name wasn't confusing with "Apple Records" (or whatever it was called, "Music" didn't sound right to me).

      And I doubt it'd apply to video distribution, but I think that'd be even harder to get into, unless they started distributing DVDs for indie filmmakers (or established filmmakers with the bucks to buck the system).

    • Apple was supposed to stay out of ALL music-related industry. However, they were big into MIDI and digital audio editing. This led to the famous "sosueme" sound on Apples.

      I think they've aleady fought this particular battle.

  • This is exactly what we need! (Score:4, Insightful)

    by swordboy ( 472941 ) on Monday April 29, 2002 @11:55AM (#3429313) Journal
    Why don't the big companies like McDonalds, Wal Mart, etc, etc realize the potential of developing their own Free music label? This would be GREAT advertising on their part. For example, Wal Mart or whoever could release songs in a digital format for Free. Perhaps they could release a special player that would not allow anyone to "share" the song until a specified date. In this respect, people would have to come into the store for downloading the new releases. I'd do this... and hell, I would definitely buy whatever I could along the way.
    • If this happened then it would be the ultimate commercial dilution of music. The songs would have embedded advertising in them. Britney would sing about how great Pepsi tastes, Metallica would jam to the McDonald's jingle, and the Boston Symphony would have "public service announcements" between Mahler symphony movements.

      No thanks.

  • Apple is *supposed* to stay out of music biz (Score:4, Interesting)

    by BigJimSlade ( 139096 ) on Monday April 29, 2002 @11:58AM (#3429332) Homepage
    Apple Records sued Apple Inc. in 1989 over a secret agreement the two had in 1981. Apple Records allowed Apple Inc. to keep their nifty little apple logo as long as they stayed out of the music industry. This came up again recently with the release of the iPod, although I don't know the outcome of the suit.

    • Yea, but... (Score:4, Informative)

      by OneFix ( 18661 ) on Monday April 29, 2002 @12:11PM (#3429382)
      To quote the article:

      And can Apple be far behind with video services out of their own retail outlets?

      I think anyone who follows Apple knows about the whole Apple Records thing...

      But, last I checked, Apple Records didn't have a problem with them distributing video content.

      They have already set precedent, because...

      We've got QuickTime [apple.com] and all of those related products...

      And, we've got Apple Distributing Movie Trailers [apple.com] on their web site...

      If they were going to persue Apple on the video front, I'ld figure it would have already been done.

  • Stupid recovery idea (Score:2, Informative)

    by Lagrange5 ( 267948 )
    With a $3.5 billion drop in net sales [gateway.com] in FY2001, and with a stock price [gateway.com] under $7 a share, not to mention an increasingly competitive marketplace for OEMs, dontcha think Gateway ought to be focusing on consolidating their business instead of trying wacky new ventures?

  • How The Music Industry Can Keep Gateway Out (Score:5, Interesting)

    by SloppyElvis ( 450156 ) on Monday April 29, 2002 @12:06PM (#3429364)
    The big players in the music industry don't have a monopoly on talent. Just look at the crap-slingers on the Billboard Top 40, and tell me nobody else has this type of "star power", and I won't listen to you anymore, because it would waste my precious time.

    Now Gateway comes along, trying to salvage getting its butt whooped by Dell in the home pc market, thinking it can capitalize on this fact.

    Here's the problem, if you want to make stars (like the music industry most certainly does), than you need to get them exposure. The web isn't bad for distribution, but promotion is tough. The simple reason is there is just too much out there for people to focus in on a group or two and make superstars out of them. In the music business, people are spoon-fed the next big thing; they make a selection from a limited pool of applicants.

    Now, if the music industry tells the radio conglomerates not to air artist so-and-so, you can bet your arse you won't be hearing them. If Bobby and Sally Teen USA don't see your awesome band on MTV, then they could only ever be "a great underground band". To Gateway's dismay, great underground bands don't usually make top dollar like the industry puppets do [save your counter-examples, I speak in the general sense].

    So, the music industry can easily prevent Gateway from impinging on their turf by leveraging their might concerning radio and television against Gateway. Without these conduits of distribution, Gateway's plan is more hype than hope, I'm afraid.
      • Now, if the music industry tells the radio conglomerates not to air artist so-and-so, you can bet your arse you won't be hearing them. If Bobby and Sally Teen USA don't see your awesome band on MTV, then they could only ever be "a great underground band". To Gateway's dismay, great underground bands don't usually make top dollar like the industry puppets do [save your counter-examples, I speak in the general sense].

      Granted, any new music that Gateway tries to introduce will have an uphill battle, just like all new music does, but that doesn't mean that they'll starve trying to do this. You know, there is a point between In*Sync and invisible where a lot of music could thrive.

      A lot of great music has always gotten around by word of mouth, anyway. I think we're ready for a backlash against the RIAA and Gateway using their storefronts for this might be just the thing to fire it up.

      I'm convinced that if somebody put up an alternative Video Music channel to MTV that just played music, all the time, that it would be successful. In fact, MTV was under anti-trust investigation awhile back because they bought up a smaller rival that did just that.

    • Thats why you sign new bands, and promote them. That why you have music scouts looking at small clubs, and surfing the internet for people just trying to get there break.
      Every one of your favorite bands was once some small club garage band, most of which you owuldn't even know about if it wasn't for distribution. So Gateway starts there own distribution. Hell YOU could start your own distribution and compete with the RIAA.
      If I was to do it, and I had Gateways money, I'd find someone who is big, but has recently finished there contract, and offer them a bigger % of there album sales. Hell, I'd scout Wierd Al just because he's so well known!
    • The big players in the music industry don't have a monopoly on talent. Just look at the crap-slingers on the Billboard Top 40, and tell me nobody else has this type of "star power", and I won't listen to you anymore, because it would waste my precious time.

      Or to paraphrase, "If you disagree with me, I will not listen to you, thereby preventing myself from learning anything."

      Big Media music is not about talent. If you believe nothing else I say in this comment, believe that. There are a great number of people who can do what Eminem can do, for example. Let's look at his list of qualifications:

      • Bitter
      • Hostile
      • Doesn't mumble
      • Symmetrical Head
      • Room for the puppeteer's hand in his... you know

      (The latter is important for conventional American standards of attractiveness.

      One of my best friends as a young teen fit all of those qualifications, and he rapped as a kid. While visiting my neighborhood Karaoke bar (which has since closed, more's the pity) I ran into one of my fellow ex-students, who turned out to be able to spit out a pretty good freestyle.

      All of this reminiscence is only to prove a point; EMINEM IS NOT SPECIAL, as a person, except insofar as every human is unique, and therefore precious. Big Media creates these people in their sense as a "superstar", whether it be eminem, britney, or whoever. Some of these pop media icons have shown exceptional talent and wit and risen somewhat above their media masters to become real cultural phenomena in their own right; people like Madonna and Prince, for example. Both are very much in control of their music, and to the extent that any of us can be, their destiny, because they knew how to market themselves, and they have actual talent and staying power.

      Now, you're saying that it comes down to exposure, and that's partly true, but it is truer to say that it comes down to marketing. Talent is not enough to become a superstar, a pop icon, the "king" of anything. You need to be marketed correctly, you need the proper void or the easy creation of one in the soundscape, and you need luck. Big Music doesn't get a "hit" with every artist, they have to fire many salvos of semi-talented hosers at the populace before one takes. Maybe their release comes out on a day when the world is feeling optimistic, maybe it jibes nicely with a current meme... But everything is half chance.

      So what do I have to say about all of this? Gateway can make money selling music using a traditional model, where they do what the record companies tell them, or they can make money selling music from independent labels who will be more open to the idea of selling individual tracks for reasonable prices. We've been waiting for the whole 'custom cd' thing to take off, without costing an arm and a leg and other vital portions of one's anatomy besides. With CD burners getting faster and cheaper all the time, on-demand CD production (whether it's mix and match or entire albums) has become reasonable; Perhaps someone will make it a reality.

      • Strange, at first I thought I was in for a flaming, but then you agreed with what I said.

        Perhaps my opinion came of a bit brutish, but I feel personally on the matter having friends in a similar situation as you describe your own. That is why I am convinced that people of great talent are everywhere, and that recording companies haven't already scooped them all up in contracts (so, to disagree with me, you'd be saying *ALL* talented and charismatic artists are already signed by major labels, and I know at least one counter-example, so this statment must be false, and as such I cannot accept arguments against it :) ). My arrogance is to prevent superfans from telling me, "nobody could ever be as big as [_insert_ favorite_band_here_] because they just have that unattainable greatness" [that comes from being famous].

        Marketing is precisely what I meant to indicate (albeit may have failed to indicate) as being the recording industry's stronghold, and you're certainly right, even the mogols can't just shove any joe schmoe in our faces and get us to embrace them. Bands are packaged like pro wrestlers, and you make a true point. In terms of marketing, Gateway has dollars, and dollars can buy marketing gurus, but recording companies display monopolistic influence over television and radio, the most accessible media for marketing musicians as you describe. Gateway is banking that the web will be a sufficient media to market new talent. I agree with this belief only to an extent. I don't think the web will generate enough of a revolution to undermine the clout of the recording industry trusts, and while it is true that word of mouth can drive a successful band, I don't think it will be enough to make this type of model mainstream. If someone should say, "what about the revolution already taking place?", I'd have to respond that this revolution is based on people getting their music *for free*, and pay-for-play web services really haven't been making bank.

        If you disagree with me on this point, feel free to tell me your opinion and I will gladly learn from you, because on this issue, I do admit I am not omniscient.
      • With CD burners getting faster and cheaper all the time, on-demand CD production (whether it's mix and match or entire albums) has become reasonable; Perhaps someone will make it a reality.

        You're not kidding. A small anecdote from today:

        I just started working out again after a nasty shoulder injury (still hurts but I can avoid the exercises that abuse it). In the past, I had worked out to Jesus Jones' "Doubt" -- it's got a nice, moving beat and uplifting lyrics (for the most part).

        So I set up my bench and dumbells in the garage, and went looking for the CD. I couldn't find it. But luckily I had started a project months ago to rip my CDs, and that was one I had ripped. 8 minutes later, I had burned it onto CD (at 12x), and had a good workout session.



        If Gateway uses distribution methods that complement this type of behavior, they'll succeed. But if they follow the RIAA's stance (that anyone burning a CD is commiting a crime), then they won't get very far.

        I'm very happy to see this development. Music makes a lot of money, and the barriers to entry keep falling. I would imagine that many, many companies (from various different fields) will jump on the music distribution bandwagon in the next couple years.

    • Here's the problem, if you want to make stars (like the music industry most certainly does), than you need to get them exposure. The web isn't bad for distribution, but promotion is tough. The simple reason is there is just too much out there for people to focus in on a group or two and make superstars out of them. In the music business, people are spoon-fed the next big thing; they make a selection from a limited pool of applicants.

      Well, when the soundtrack for "Oh Brother, Where art thou" came out, it received little airplay because media focus groups thought it sounded 'too twangy'. Turned out that because the music was good it really didn't need radio exposure.


      In fact, as good as the internet is for distribution, it would be far better for exposure. But don't take my word for it - look at how well spammers and con-artists have been leveraging the internet.



      Word of mouth is usually used to sell most items. And over the net it is far more effective and efficient than the current system of using marketing groups and advertising to push music onto the populace. I have purchased far more music through trusted advice over the Internet than what I hear on the radio.


      So it doesn't sound like a problem to me. Who knows - it might bring about a musical reinaissance where the emphasis is back on art and experimentation, rather than image.

    • Say WHAT? This is Big Media vs The Internet again (Score:4, Interesting)

      by Ungrounded Lightning ( 62228 ) on Monday April 29, 2002 @03:29PM (#3430882) Journal
      Here's the problem, if you want to make stars (like the music industry most certainly does), than you need to get them exposure. The web isn't bad for distribution, but promotion is tough.

      Now, if the music industry tells the radio conglomerates not to air artist so-and-so, you can bet your arse you won't be hearing them. If Bobby and Sally Teen USA don't see your awesome band on MTV, then they could only ever be "a great underground band".

      That's the way it WAS.

      But we're on the Internet now.

      The Mainstream Media is getting CREAMED by the Internet, in one venue after another: news, content, and and exposure to name just three.

      To paraphraise the way my wife puts it:

      "Word of Mouth" takes on a whole new meaning when you can get on your computer and recommend an artist you like to "a couple million of your closest friends".

  • Hardware less profitable (Score:5, Insightful)

    by nucal ( 561664 ) on Monday April 29, 2002 @12:19PM (#3429410)
    I wonder if the "hidden" message here is that Gateway sees PC sales to continue to be weak and they are desperately looking to do something with all of those retail outlets ...

  • Why? (Score:2)

    by Otter ( 3800 )
    I'm happy to see Gatway standing up for fair use, but -- what sense does this make for them?

    It says something about their view of the PC business that rolling the dice on some wildly speculative entertainment industry venture seems attractive.

    • I guess that they're hoping that they can continue to sell hardware, unlike what the RIAA & MPAA plans would do.

  • Gateway is NO BETTER.. (Score:3, Interesting)

    by Archfeld ( 6757 ) <treboreel@live.com> on Monday April 29, 2002 @12:26PM (#3429454) Journal
    they are the same as the RIAA/MPAA they just don't have the $$ yet to buy the political muscle. Look at their PC agreements. Open the box void the warranty, it MUST be serviced at Gateway.
    I would not buy a computer from them what makes you think I'd buy music from them ? Just because someone is competing with the Music Behemoths does not make them our friend, probably the exact opposite.
    Stand up for yourselves, you are NOT consumers, you are CUSTOMERS, and need to be treated with some respect.
    • There's a BIG difference between "open the box void the warranty" and "open the box get arrested".

      I'd have no problem if the MPAA said "well, if you distribute DeCSS, you'll void the warranty on any DVDs played using it". Or if the RIAA said that they wouldn't give any warranty to a CD if it's used to access my.mp3.com (hey, wouldn't it be nice if someone actually *offered* a warranty on CDs?). Or even if the MPAA said that bypassing the region coding on DVD players would void the warranty.

      The problem is that in fact these groups are doing no such thing. They actually want it to be IMPOSSIBLE to do these things. The equivalent would be an EULA on a Gateway computer that said that you waive your right to use any other manufacturer for repairs or service. And then they sent the police after you if you tried it.
    • >Open the box void the warranty, it MUST be serviced at Gateway.

      That's because of retards that have a hard time even realising that you don't plug a phone cord into the network card, not to mention the (HALF HOUR) support calls on which way around the keyboard and mouse plug in [even when they're colour coded the users don't get it].

      I've heard stories (at the store I worked at) of people removing the backplate on AGP cards and putting it backwards into a PCI slot because they are too STUPID (as far as computers go) to know that doesn't work. I probably don't even need to mention the people that force mating conectors (molex and IDC) in backwards...

      If people fixed their cars with the amount of knowledge most people fix their computers, we'd have 90% of the cars on the road without brakes.

      Personally, I void the warranty on these computers without worry. But then again, I spent some months in a computer repair shop, so I know what I'm doing, and I know why the "Warranty void if removed" stickers are there.

      If you _don't_ know why they're there, its a certain sign that you have no business violating them.
    • You obviously don't own a Gateway.

      I do, and I'm typing on it right now. I had a problem (over a year ago) with the PS/2 ports locking up on boot, which prevented the computer from reliably booting.

      As part of the over-the-phone trouble shooting steps where to remove the cover, and reseat the CPU and memory.

      Personally, I have never had a very high opinion of tech support (as a whole, there are certainly exceptions), but I Gateway's service to be knowledegable and helpful.

      Perhaps Gateway will turn into a draconian drain on creativity, but for the time being they seem to be interested in taking the path less traveled.
  • Ahh content, the last resort of the doomed hardware manufacturer.

  • Bad Idea, but positive consequences (Score:4, Insightful)

    by Essron ( 231281 ) on Monday April 29, 2002 @12:48PM (#3429579)
    This strategy is clearly doomed. First, we have the fact that Gateway has NO knowledge of the entertainment industry or media distribution, and arguably little knowledge about making decent hardware.

    Second, we have FuckedCompany [fuckedcompany.com]. With all the casualties in the online music space, Gateway better have one hell of a secret weapon. Great customer service and brick-and-mortar stores full of low-tech heads-of-households looking to invest in a computer will not help them sell records.

    Gateway is a crumbling company. A look at recent news shows that they are clearly in a state of panic. Last I remember reading was that they were closing European operations and trying to get into IT consulting. I repeat: state of panic.

    In the wisest of possible strategies, this music ploy is just a publicity stunt to earn credibility with "all those crazy kids." In their more probable strategy, it is simply bad management making a poor investment outside of their core competencies.

    On a positive note, any money they throw at this project will be applied to a full frontal attack of the entertainment media establishment (xxAA's), which in a moral sense may be an ideal use of funds. In an economic sense, it is a waste of precious resources.

    • In their more probable strategy, it is simply bad management making a poor investment outside of their core competencies.

      I think you are giving them more credit than is due. I don't think Gateway even has a core competency.

  • But Whose Music? (Score:2, Interesting)

    by JeffRC ( 103922 )
    If Gateway were to distribute music online the question is whose? The major labels aren't going to license their hoard to Gateway. The artists might, but most of the major names are tied by exclusive contract to their label. So Gateway is going to release music by unknowns? Without some major artists providing music the idea would be doomed.
  • These guys are burning bridges with the zeal of a pyromaniac. First they Actually had the stones to go public about Micro$oft's policies towards OEM's. Now they're basically toilet papering the RIAA's front yard. I'm no Gateway supporter. Like mentioned in an earlier post, they cater to the lowest common denominator. But I haven't seen Dell or Compact saying anything publicly about the way MS bullies the OEM's. Maybe they'll start doing commercials that show the Gateway cow taking a dump on the Dell-dudes front yard (Dude, what's that smell?!) or commercials having some fun with the internal pissing match at Compaq/HP. If these guys want to have even a chance of surviving past this year, they need to be socking the other companies in right in the chops every time they get a chance, because I don't know of too many success stories providing content like they're planning to.

  • Gateway, Inc. : On-Demand Publisher (Score:3, Interesting)

    by Anonymous Coward on Monday April 29, 2002 @01:18PM (#3429807)
    This could be the first working example of a much-touted, but heretofore unimplemented business plan: an on-demand publisher.

    Let's say a customer lives near a Gateway Country Store, and doesn't have broadband Internet access. Said customer could use MP3.com to mix-and-match an album, then pick an option to have it burned to CD at the Gateway store. Assuming that each Gateway store has a pipe with halfway-decent bandwidth, and assuming that some of their demo models have CD burners, the disk can be waiting for the customer by the time they drive to the store.

    If Gateway allows users to surf to the site from the stores' demo machines, then Gateway can even generate impulse-driven sales. The "netCDs" at MP3.com are $4-6 each, Gateway would buy blank CD-R in bulk (less than $1 per), toss in one dollar for bandwidth/employees/profits, and Gateway can charge $6-8 per CD, undercutting MP3.com (because there's no shipping) and RIAA (because their not evil, price-gouging control freaks).

    What do you think?

  • Fry's Electronics sells audio and video content, but more as a traffic builder to get people into the store than as a major money-maker. Gateway may be thinking in that direction.
  • Gateway's sundown ad [gateway.com] is great. Where can I find the Whip It ad that the articles keep mentioning?
  • Makes one wonder if the xxAAs will roll-over and take their tithe


    You miss-spelled "make their time"


    Rich

  • Remember when you went into Best Buy and saw that they started putting up their stupid magazine rack that had a lot of titles that had nothing to do with computers and stereo stuff? I smelled death. My sister is in the book selling business. She tells me how cutthroat magazines are. Magazines in Best Buy are very similar to Gateway tryng to make albums.

    See, in a retail sense, magazines racks are the first hallmark of death. Magazines are cheap, high volume, and handled by "rack-jobbers" out of house. When you put in shelf space for primarily someone else's profits? Well then, you are in trouble. Gateway getting into music? It is a magazine rack to them... a quick buck.

    It smells like Enron when Gateway wants to get into music. Enron was into the whole elctricity and gas business (which you can always make a buck in when you have the price regulators in your back pocket) then they decided that utility profits weren't good enough. Then they started screwing their core business because they put it all in risky stock crap in a market that was paying out like a casino. When it didn't pay out, then they started screwing people over, big time.

    Apparently Gateway is trying to diversify... but the truth of the matter is that it stinks of death all over it. Smells like a magazine rack.

    If they are doing this to tag some artist to get someone in a Gateway Country store or promote proprietary Gateway stuff, well, look out. That business model makes no sense. Besides, record producers wait years at a time for a hit. How much patience do you think a product producing company has about profits? ABOUT THREE MONTHS until the quarterly statements are due, then they pull the project because it didn't pan out in three months.

    I would be scared. Heads might roll any day now.

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