First off, that pie chart is not that accurate. Trust me on that.
Why should I trust you? What is your version of the pie chart? I hope you are not calling Rolling Stone a liar....
The point of the breakdown is that there are clearly much better ways to distribute music. People have found them. Cut out that fatty part of the equation through direct artist downloads and you have the sub $5 CD with more going to the artist. I'd pay it. It's easier than learning all this how to steal stuff.
The people I care about in the music industry are the artists and they are the ones getting the least. The labels? Last I checked there isn't a rash of foreclosures in SoCal becasue of the hard hit record industry.
I am not calling RS a liar. Just mis-informed. I have had discussions about that pie chart with retailers, artists, labels, distribution companies, and publishing rights owners. It is nice and round and based on some very, very broad assumptions. The simple fact that Wal-Mart sells 35% of the music in the US, and their average retail price is sub $12 shows you that the pie is wrong.
That being said, I agree with you. Their are more efficient ways of music distribution. It is not a simple as "cutting out the fatty part", however. As it may be fat, it still adds value and promotes/sells music.
Somebody has to take the production risks of an album.
Somebody has to take the promotion risks of an album.
Somebody has to bear the cost of "working radio" (or Internet radio).
Somebody has to bear the cost of creating a video.
Somebody has to bear the cost of creating a space for commerce to exist.
Somebody still has to bear the cost of a physical storefront (80% of music is still sold at retail).
Somebody has to bear the cost of inventory risk (85% +of music sales are still physical).
These are things that the "fatty part" do. Do they do them all well? No. Are they working feverishly to rebuild their model? Yes.
Is it too late? Could very well be.
Meaningful direct artist to consumer sales only take place where a band already has a following. Already built a brand. Already benefited from the "fat" that you abhor.
More power to them to try and sell $5.00 collections of music.
"Before indoor plumbing and chlorination of the water supply, outliving dysentery required an intestinal fortitude that was considered special. These kids today don’t even give dysentery a second thought."