COMMERCIAL KARAOKE: A snapshot of the market
By Kurt Slep, CEO/Owner Sound Choice
As I reflect on the karaoke industry from my desk at Sound Choice, I am dismayed at where I believe the Commercial Karaoke Industry is today, yet optimistic about where it is headed. Sound Choice was one of the first companies in the U.S. “karaoke” market (we used to call it “sing-along” back in the late-80’s) and we have seen a number of companies and formats and mediums come and go. In my 25 years at the helm of Sound Choice we have gone from earning $10 per track on cassette to making nothing while pirated hard drives containing over 100,000 songs sell for $300.
I believe the interest in singing is even greater than when we started, but technology and an ethics shift among consumers has led to a huge decline in the music industry overall. It’s a paradigm shift – 25 years ago, water was “free” and people paid for music. Now people who think nothing about spending $2 for a bottle of water balk at paying $.99 for a song download. Efficient distribution technology (cheap laptops, inexpensive memory and the ease with which files can be shared over the internet) and a “because I can” mentality along with cheap, illegal hard drives loaded with tens of thousands of stolen music have led to unfair competition, a drop in the amount of revenue a host can earn and an over-saturation of karaoke venues.
There is still interest in live performing, but the weak economy, dilution of the commercial marketplace and a myriad of home-consumer options leads to fewer singers per show. The overall quality of karaoke shows has gone downhill because “amateurs” with a laptop, a $300 hard drive full of illegal songs and a $200 sound System are displacing hosts with many years of experience and a legal set of discs as back-up to their systems. In a recent LA Times article, Tiffany Hsu, discusses a lot of these conflicting forces but I agree with her bottom line “Most experts blame piracy, not pop culture, for crippling traditional karaoke. “. (http://www.pressherald.com/business/karaoke-industry-gasps-for-breath_2010-04-04.html )
That’s the dismaying part of my article. How do I find optimism looking up from the bottom of the trough? As many KJs are aware, Sound Choice has begun to fight back with lawsuits targeting venues and hosts who are operating with stolen copies of our music. Although we were the first karaoke producer to take action, expect to see Chartbuster and Stellar Records filing similar lawsuits.
Sound Choice has received a great deal of support from KJs who have fallen victim to pirates undercutting their business because of unfair competition. Even among the defendants in our suits, many have said that they realize that our suits are necessary to stop the downward spiral in pricing and professionalism and the oversaturation in venues offering karaoke. We are now giving a legal host tools to help combat both the pirates and the venues which are willing to turn a blind eye to them. Yes, it’s “tough medicine”, but often the medicine that tastes the worst is the most effective. Feedback from the field is that legal hosts are beginning to command more for their shows again, venues are checking “credentials” before hiring someone and we are seeing our own sales rise again, so we will soon be releasing new music. Those are reasons to be optimistic!
We also recognize that MP3G is the format of choice and a hard drive based system the medium of choice. That’s why we are introducing the GEM Series by Sound Choice. These are 320kbps high quality files created from the original masters, so there should be almost no glitches as are often encountered with the illegal tracks floating around. However, one of the best reasons to purchase GEM series discs from Sound Choice is that you will be able to participate in promotions and contests that will be planned with various organizations that we sponsor, which will hopefully make your shows more popular. And, if your own shows and venues are challenged by pirates trying to undersell you, you will have our support in educating/warning the venue of the legal and financial consequences of hiring pirates.
So, besides the convenience and quality difference of buying MP3+G tracks direct from Sound Choice, why should you buy now? Well, aside from the fact that it’s the right legal and moral thing to do if you have been operating karaoke with stolen music, there is also the financial incentive. If you purchase a library BEFORE you are named in a lawsuit, you will save about 50% over the minimum settlement cost. Further, based on demand, there will be a limited quantity in the first release and those with legal discs are going to be able to take shows away from the pirates. So, you might end up in a lawsuit with no gig to support your payments.
Sound Choice has chosen to partner with ADJA, the worlds leading association for Mobile DJs and Karaoke Hosts, because we believe in their Code of Professional Conduct. Further, once the majority of hosts are legal again, you will have to differentiate yourself in a new way. And joining a professional organization like ADJA is a cost-effective way to continue your education, learn from fellow professionals and even save money! Buy the Diamond Set from Sound Choice and we will even pay your ADJA dues. Now that’s something for KJs and DJs to be optimistic about!
Kurt Slep is CEO and owner of Sound Choice, one of the world’s leading and most recognized brands of Karaoke music due to its quality and size of its catalog. Although he is professionally trained as a Chemical Engineer (Master of Science, 1979, Washington University, St. Louis, MO) Kurt has spent most of his career at the helm of Sound Choice, which celebrated 25 years in business in March 2010. Kurt’s personal responsibilities have included overall corporate business management, music and hardware product development, marketing and technology R&D and music licensing development in Mobile, Television and Internet Industries. Before the collapse of the World’s economies and the rise of digital piracy, Kurt spent 4 years developing overseas karaoke music licensing and business development in countries such as Russia, Ukraine, all of Scandinavia and Western Europe, China and parts of Latin America.
