The End of Cultural Arbitrage: the West

The media is starting to take note that trend cycles are moving more rapidly than before, and the new shorter trend times are forcing the fashion in question to be judged as inconsequential when implicitly compared to culture of the past. We will never equate the six-month hipster media fixation on electroclash with the four-year long grunge festival of 1992-1995.

In the 20th century, fashion life-cycles were long enough to allow products or cultural items to leisurely pass through the hands of innovators, early adopters, and mass consumers -- in that order. Each group had enough time to adopt, use, and enjoy the thing in question before rejecting/disposing it for something cooler. In the trickle-across theory of fashion (adapted from Simmel's class-based 1904 trickle-down theory), the first adopters - "the cultural elite" or trend-setters - abandon the trend once the next hungry group expropriates it in imitation. This presupposes two conditions: 1) the upper echelon has better access to information (i.e., they know what is "cool" faster) and 2) there is ample time for groups to really adopt fashions before having to abandon them in the never-ending cycle. I believe this theory has successfully explained the flow of trends in the past, but the two previously-stated presuppositions no longer can be assumed in the current environment. A broadly-shared Internet allows both equal and instant access to information, which in turn shortens the time the first group gets to enjoy the trend before the party crashers arrive.

The hipster elite are starting to show annoyance at this development. Former mo wax guru James Lavelle, quoted in Tokion, lamented that it is now impossible to stay "underground." Lavelle and his kindred folk profit from exploiting "cultural arbitrage": taking information from inaccessible sources and cashing in on that unequal access to information. (In general, a lot of people whom you probably think are cooler than you make a bulk of their money from this inequality in information.) No one in the West knows that bape is a mainstream brand in Japan, and therefore, Lavelle was able to subtly and indirectly create the brand image to his own liking. In the 70s, stocker broker types could earn a living just from real financial arbitrage -- profiting through price discrepancies in currency markets. But then came along the internationally-networked computer, which could cut the reporting time on those discrepancies down to microseconds. This generally killed off any attempts to make a career out of this economic game. Now, with the high speed "information superhighway," profit from cultural arbitrage business looks doubtful in the long run.

Let's go back to James Lavelle. he upped his cultural ante in the mid-late 1990s by exclusively wearing the Japanese street fashion brand a bathing ape. He had connections to Nigo and co. through random jaunts to Japan and connections to the Major Force collective. His support of the ape-emblazoned clothing was a Pavlovian dinner bell to drooling UK hipster circles, but the brand's virtual unavailability in the West made it impossible for anyone outside of the Mo Wax "posse" (e.g., Futura and Stash in NYC) to get their hands on it. The lack of a direct product and information flow from Japan enabled these guys to figuratively (but probably not literally) "cash in" on their knowledge. No internet --> no information --> underground status --> cooler than thou.

Then in 1999, two know-nothing 19-year old American kids opened the "first unofficial bathing ape website" on the Internet as a way to innocently spread english information about the brand and bow at the altar of international street culture. Little did they know that they were being terrible cultural cockblocks to Stash and Futura and crew: Ape was their thing! and they were not happy that two nobodies were talking about it in public. Suddenly, the New York Times is knocking on the doors of Recon requesting to photograph the ape shirts (They found the store on a tip from the unofficial ape website). Sensing that the website was peeving the very people it intended to worship, the creators soon shut it down. In this case, the Internet did not end Ape's popularity or exclusivity in the West, but it is an early example of how angry people get if you crack the old system.

To their credit, Lavelle and co. like(d) bape on a personally level; they weren't "fronting". The trickle-across theory -- or almost any traditional theory of fashion -- needs the "cool" innovators to honestly enjoy the product of their choice for a somewhat extended period of time, and therefore, the whole process starts to crumble if they are immediately copied. Being imitated in a short amount of adoption time forces a no-win solution: quickly abandoning a style because it's being copied by "less cool" people also means abandoning something that the fashion leader is supposed to "honestly" think is fashionable. These days, the media can spot a trend in its infancy, which leads to the following trend-killing responses: 1) People who shouldn't know about it learn about it just as fast as "cooler" people ["see you at the Warsaw this friday after Finance class. lol"] 2) Those with access to alternate, negative information about the brand can freely spread the word ["Casey Spooner can't sing."] and 3) Those who pride themselves on being "in the know" are immediately turned off by learning about a trend from the internet. ["whatever W.I.T. is, I now hate it."]

The Music "Business"

Record sales continue to slump here in Japan (and almost everywhere else in the world), and there does not seem to be any hope that this trend will suddenly reverse its course. One new major label artist in my acquaintance did fifty interviews as part of their debut promotion and only sold 600 copies in the opening week. No one is buying music, and it's not directly due to the internet or file trading, but a slew of demographic and economic structural changes.

Meanwhile, the growing ease and quality of home recording is increasing the number of releases. Less sales overall and more artists means massive cannibalization: even if you sell, you sell less. So what is the response of Japanese musicians? Work harder! Everyone is blaming themselves for the lack of sales, and even the indie kids are embracing cold-hearted corporate marketing techniques. There is something disheartening and desperate about bands saying "Buy our cd! It's over there at that booth!" instead of the simple plea "Please listen to our cd." Japanese bands are also major practitioners of "anquette" (surveys) which the band collects and analyzes after the show. I don't believe that art should be focus-grouped, but moreover, I doubt that the opinions of the 15 friends you've wrangled in to see your band are going to help you sell more records.

Meanwhile, the drop-off of magazine sales has forced music magazines to be more and more dependent on "tie-up" (a euphemism for payola) to pay the bills. I don't want to name names (like Barfout), but there is something creepy about magazines that contain no ads, or worse, an ad two pages away from an "editorial" piece on the same artist using the exact same press shot. Rockin'On Japan is notoriously bad about this pay-to-play. The absence of critical reviews in Japanese magazines, however, is as old as the industry itself. the Japanese music scene contains an extra player between the artist and the label, the jimusho (management office). The first jimusho (and certainly a lot of the current ones) were run by organized criminal syndicates, who made it very clear from the start that members of the press would have to answer directly to jimusho toughs if they have something critical to say about an artist. Editors complied and eventually got lazy. they are now are happy to just print parts of the press release as the "review."

Without a critical media, magazines don't have obnoxious things like "Worst Album of the Year," but they also don't carry any kind of independent judgment system for records. In the West, an artist can have no sales, but enjoy the pride of "critical acclaim." This does not exist in Japan, and therefore, the only way to judge the performance or even talent of a band is through record sales.

So, there is a general attitude in Japan that music that does not sell is not good. I don't believe that this is because Japan has an inherently greedy or shallow society, but because the complete media system only rewards those that sell. Which makes all indie artists agonize over the number of copies moved instead of being happy with their overlooked genius. What doesn't help is the fact that a band like hi-standard were dropped from their major label, started Pizza of Death records, made a killing by releasing their own cds, and then retired as rich men. This story - which is an exception, not a rule - is an enticing anecdote to any indie kid, but unfortunately not an accurate description of the market. hi-standard had already accrued a relatively large fan-base before they started their own label and happened to be one of the more popular bands at the exact time of a major resurgence in punk rock.

In general, there is no money to be made from music. Most people lose a lot of money from recording and equipment and envelopes and stamps, and any profit from small record sales goes to recouping that. The major label dream is a hoax. The Beatles proved that the record industry could be a big business, but they also had major historical and technological advantages on their side. Namely, there were very few rock'n'roll records in the 1960s, and consumers who wanted to get in on the game had to buy these new records. There were comparatively no "oldies". In 2004, there is so much good old music, that it cannibalizes the current music market. If you buy the White Album, that $25 is not going to buy the Black Album. The Beatles didn't have to compete with Cole Porter.

Besides the lack of old releases to interfere with the sales of new artists, the record industry also had a complete monopoly and control of the audio medium. You either bought the LP or didn't have the music. Cassette tapes somewhat changed this, starting in the 70s. I didn't buy a lot of music in the 1990s because I borrowed it from friends and "taped" it. But tapes sounded terrible and fast-forwarding to get to "It's the End of the World as We Know It (and I Feel Fine)" was a major pain. Cassettes made you lust after CDs. Now, with the iPod, I would rather not have the cd: it's just going in my closet. The iPod is way more convenient and portable than CDs and basically sounds just as good. Anyone who says they really care about cover art and booklets is lying. There is not a lot of evidence that mp3s alone are killing the music business, but they surely take away the monopoly of the medium from the industry.

So, the success of the bands in the past does not mean anything now. The other important thing to remember is that a vast majority of major label bands make NO money at all, and their failures are buffered by the success of the other groups on the label. In 2004, selling 3-5,000 records is a relative "success" for a lot of small bands, and even if you own the master rights, that means only pocketing $3500 or so.

This all leads me to my main point: there is no money to be made in music. If you want to make money, do something else. "Profit" in the music business is not even "economic profit" -- profit minus opportunity cost. If you work your whole life at a bank, you will see a LOT more money.

So, all music production and performance should be started with the understood pre-assumption that there is no money to be made in music, and therefore, the goals should be unrelated to financial matters.

I don't quite understand where the idea that musicians are to be financially rewarded comes from. Poets don't write for a paycheck. model train enthusiasts don't charge people to look at their collections. I believe that secretly we idolize the so-called rock star lifestyle because it is utterly irresponsible; you can trash hotel rooms and force other people to tolerate your childish behavior (They have to - you're famous.) Sure living a life of conspicuous leisure and debauchery is enticing, but not realistic for 99.99% of people or tenable in the long-term.

This is not to say that the listener should not financially support bands he/she enjoys. Especially with indie labels and artists, one purchase is not money for artists to indulge in, but for the most part, to repay all the debts accrued from the production process. Major labels are not personally responsible for financial loss the way that small indie labels are.