June 11, 2005

Popular Revolutions/Mixtape Economics

It was probably Lawrence Lessig who first compared file sharing with the prohibition and the 55 mile an hour speed limit. Acts of government widely ignored the population at large. And like the prohibition and the speed limit, there are points of conflict between the law and human behavior. The era of intellectual property police action is unfortunately it seems beginning to reveal itself. Yesterday it took the form of a raid on New York's indie music superstore Mondo Kim's.

What separates the Kim's raid from the many that came before it is cultural. Kim's was targeted for selling mixtapes, CDs made by DJ recombining songs into a new cultural product. Most police actions in the intellectual property realm fall into a particular historical continuum that stretches back for centuries, smuggling and other acts of customs agents. While there is a certainly an intellectual property element to raids on sellers of fake Gucci goods, or unlicensed Star Wars DVDs, ultimately this is a new variation on the classic, avoid customs/import illicit goods operation. But in targeting mixtapes the New York Police Department changed the rules of the game, back into the cultural realm, back towards another tradition, censorship. Mondo Kim's is not in the position of the smuggler, but in the position of the bookstore selling Tropic of Cancer.

The mixtape is another item in a long line of artforms whose existence is threatened by "hard copyright". Were copyright to be enforced as written in the books today the mixtape would be far to expensive for anyone but a major label or wealthy fool to produce. Throw it in the box with remixes, fan fiction, sampling, web animations, collages, independent film, and home video. Luckily of course the letter of the law and the practice of the law are two separate, but intertwined, dynamics. Most police forces it seems have better things to do then to chase after DJs selling CDRs of their latest mix and blend. Until now that is, the Mondo Kim's case is perhaps a bellwether of a shift, or perhaps merely an anomaly, a police action with no more meaning then a ticket for doing 56mph.

What's really interesting to me though is the economic aspect of it all. I've written a bit about it in the past, but ultimately its still deeply gray. Gray market, unanswered questions. Who makes money of mixtapes? How many get sold? How many of those that get sold are made by the original maker and do they care? Do big hip hop mixtape kings pay for exclusives? Do young bucks pay to freestyle?

Some things are clear, this is an economy of velocity. The stars pump them out fast, the new shit, the hot shit, that's what's sells. Its a singles music market, but on 72 minute discs. Someone is making money, mixtape pioneer Kid Capri claims he made a small fortune selling tapes on the Harlem streets and the big mixtape producers run small empires now. Many a hip hop artist got their start selling mixes or freestyling on them. 50 Cent most notably kept his career alive via mixtapes after losing his first major label deal. A mixtape doesn't even need mixes on it, often its just a faster, cheaper way to put out a CD. Maybe its all one artist, maybe its a crew, maybe they rhyme over other peoples beats, maybe they freestyled it all in one night. The difference between a small regional record label and mixtape producer is sometimes non existent. Cash Money in New Orleans, Swisha House in Houston, Dip Set in New York, all murky economics. The price point for mixtapes ($5-10) just happens to be the same as street drugs, its a similar hustle although the turnover and size of the customer base are quite different. Street level economics, but with potential to turn into international brand names.

For a while it seemed the major labels had come to peace with mixtapes, at least in a hip hop context. They function all most like a minor leagues. A mixtape star like 50 Cent could graduate to the big leagues prefiltered and with with a hit under their belt. Songs can be leaked to the mixtape DJs for test marketing. A few years ago "Oochie Wally" by the Bravehearts, a collection of hangerons around the star Nas caught mixtape fire and was booming out of every other car in the tristate area. Nas's label quickly added a verse by the star, edited the impossibly pornographic lyrics for the radio and had itself a hit single. Use a mixtape properly and its like offloading your marketing and testing. Free publicity, what label is not down with that?

Rumor has it though that the Mondo Kim's case emerged when a Sony exec saw mixtapes in Kim's with unlicensed Sony tracks on them. An anomaly or a sign of a shift in tactics? The law and the culture are not in sync. Like the 55mph speed limit or the prohibition an uneasy peace can go on if the police forces are complicit. But if some thing, some exec, some organization, forces the letter of the law into conflict with culture, what happens then? In other words, what happens now?

Posted by Abe at June 11, 2005 11:52 AM