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MP3.Com: A Consumer Behavior Case Study on Social Power
(Coercive Power, Referent Power, Expert Power, and so on.)

D. Brouse and S. Mukherjee
Initial Publication Date: December 2000
InternetU.org

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Abstract.

Pursuant to the work of Raven and French (John R.P. French and Bertram Raven The Bases of Social Power, The University of Michigan's Institute for Social Research, 1959) in the area of consumer behavior, does social power help explain Internet companies such as MP3.com?

There are five sources of social power:

All of these types of power require an agent -- an individual, group, norm, value or practice that exerts an influence on a consumer. The influence of the agent is known as his/her power.

Sometimes, the above mentioned sources of power are not clearly defined. In fact, what was intended as reward power may end up looking like coercive power.

Turning Reward Power Into Coercive Power

An example of this may be MP3.com's reward program. MP3.com has set-up a reward program for participating musicians. If you sign-up for this program, you can make a couple cents per "certain events happening" (such as, enough individuals listening to your music on any given day.)

However, what was represented as a reward program appears to have turned into a coercive program. That is to say, the musician is threatened to behave in a particular manner. MP3.com publicly posts each musicians "Payback Earnings". If you are a musician with little or no Payback Earnings, what will people think of you?

This strange phenomena first occurred to me when I started receiving fan mail from our MP3.com webpage. While manning the Help Desk for The Membrane Domain and KingArthur.com, I handle hundreds of pieces of fan mail on any given day. But, when I started getting email from fans at MP3.com, I found something very odd -- all the fan mail was from other bands. And, they didn't appear to really be fans. In fact, they all pleaded for me to come listen to their music. Then, I went to the MP3.com website. There is a section called "Tips For Payback For Playback". Here a musician is encouraged to increase the vistors to their MP3.com website. An example is to post a message in web rings:

Sample post: "Check out my latest song and MP3.com will pay me cash."

There is also a bulletin board where bands can tell each other how to increase their rewards. A typical post suggests emailing all the other bands on MP3.com to come check out their music... and, then they promise to check out yours.

The result is intimidation of the musician by MP3.com and his/her peer group. Or, do you want to be the only musician in the community with $0.00 in Payback Rewards?

Reward Program or Muti-Level Marketing (MLM)

Once I started to discover a "community" directed by coercive power, there appeared to be several facets to the hierarchy. It felt as though their was some sort-of marketing army at work. Indeed, upon further research at the MP3.com website, I found that a musician is encouraged to "Join the New Music Army (NMA)".

This army appears to spend their days recruiting viewers to the MP3.com website... one-by-one. In order to make several hundred dollars in any given month, the musicians spend hour-upon-hour getting individuals to download their music?

Is that what is really happening?

Upon closer examination, it looks as though MP3.com is using an elaborate computer program, Java Script and cookies to track advertising. In fact, an artist is not allowed direct access to their own music. In order for a musician to make a penny, MP3.com must be able to track the listener as a unique individual.

Where this differs from most multi-level marketing schemes: this plan has the sales agents make their own product.

Disturbing Abuses Of Power

During my study, I've run across several examples of what I consider to be "disturbing abuse of power". An example of an abuse of power is the usurping of a musician's mechanical copyrights.

When a musician submits a song to their MP3.com website, they are asked what uses are permitted with their material. There are several choices... all of which are checked with default settings.

Here is an example:

screen shot from mp3.com

Does a normal musician understand what rights they are giving up when they submit using the default settings? It appears as though MP3.com is saying that they may make audio CD's (or other products) and not pay the musician.

Where it goes from ugly to disturbing is the original licensing agreement. Mp3.com promises a musician, up-front, that they may cancel at any time. How is it possible for a musician to cancel his song from an audio CD? If I become famous (and decide I'd like to get paid for my music) will MP3.com recall all outstanding audio CD's?

Most of the musicians that participate with MP3.com do not appear to plan for success. Thus, they have given little thought to these matters. Is it the musician's fault for being naive and gullible? Or, should MP3.com be blamed for unfairly exploiting the artists?

Exploitee & Exploiter

Exploitation need not be a dirty word. Almost all musicians want to be exploited. In fact, they hope to make a living by being exploited for their talent. However, throughout history we've seen great struggle and debate over exploitation issues.

The way in which power is used is often scrutinized by society. Though the standard tends to vary over time, most reasonable people have come to agreement on minimal standards. In it's worst form, exploitation of a human is called slavery. Nearly all humans agree:

lack of personal freedom is not acceptable.

Not all forms of exploitation are this easy to diagnose. In the case of MP3.com, the exploitation comes in many subtle shades. Another instance of their intimidation tactics is in their use of censorship. Who determines what I can say and do on my MP3.com webpage? (Please see the accompanying study for more information.)

Do censorship, ridicule, abuse of power and fear compare to slavery? Certainly, not. But, to what extent do they differ?

What Have Ye to Say on These Matters?

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References:

"Consumer Behavior", Kenneth E. Runyon (1980)

Complaint Filed with the SEC Against MP3.com and Michael Robertson

ArtistServices.Net: Is Their Advertising Misleading?, Ted Ray & KingArthur.com (2000)

"Censorship At MP3.com", D. Brouse (2000)

"MP3.com spins unknown artists into Muzak", CNET News (2000)

Complaint Filed with U.S. Securities & Exchange Commission, D. Brouse (2001)

MP3.com censors anti-MP3.com song, Eliot Van Buskirk (2001)

MP3.com, recently bought by Vivendi-universal is not a home to independent artists anymore, Analog Pussy (2001)

Quote from MP3.com:

"Sign-Up Questions"
Q: Do I have to upload my music or can I link to my songs?

A: We require that all songs be uploaded to our server."

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