Remember a couple months ago, when Warner Music's Edgar Bronfman complained
that the makers of video games like Guitar Hero
and Rock Band
should be paying more for the music they used? He claimed, incorrectly, that the games were "entirely dependent" on the record labels' content. That was wrong, and totally downplayed the fact that the video games were actually adding value
to the music. Now it appears that the maker of Guitar Hero, Activision, is hitting back. The company's CEO is pointing out how much being in those games has helped bands
, suggesting that its really the record labels that are getting too good of a deal:
"When you look at the impact [the game] can have on an Aerosmith, Van Halen or Metallica, it's really significant -- so much so that you sort of question whether or not, in the case of those kinds of products, you should be paying any money at all and whether it should be the reverse. The bulk of our consumers will tell you they're not purchasing the products based on the songs that are included, they're purchasing based on how fun the songs are to play when they're playing them."
He's exactly right. The content industry always seem to over estimate how much "value" the content provides and almost totally ignore the value provided by anyone else in the value chain. It's going to be interesting to see what happens over the next few months, but I would bet that the video game companies have the stronger hand here, and despite Bronfman's statements, the record labels really understand that.