Setting Straight the Record on Tower’s Tech

A guest comment-to-post from Tower Record’s Mike Farrace.

May 8, 2016

I’ve decided to republish Mike Farrace’s comment to my 5/5 post 3 (Possible) Higher Ed Lessons From Tower Records.  Mike was the SVP Publishing & Electronic Marketing (among other roles) from 1997 to 2003 at Tower Records.  


A friend forwarded this piece to me. May I say, I take exception to it. It’s cavalier and badly-researched. I worked there for most of three decades and was in the movie myself.

I am tempted to call you a name or two, but I see that you are a serious and accomplished guy — author, educator, lecturer, consultant, Dartmouth big shot, etc. So, I will spare you the vitriol. However, I will indulge myself by writing until I am through.

And I do realize you are using your casual insights from the Tower movie to specific ends, namely to draw parallels to the challenges universities face to avoid irrelevence. So, I guess you are entitled to a little license. But in the process, you do our great old company and its employees a disservice.

First, Tower was indeed a community, probably the first of its kind save for some of the great neighborhood independent record shops that preceded it. That message was abundantly clear in the film.

Secondly, if you did a little homework you would know Tower practically invented the concept of in-store performances (although many of the best things at Tower were conceived by record company guys, artist managers and other smart people). Tower hosted thousands of live performances, practically from day one in 1960. Napster was full of mixing board recordings of them and you can still find them on Usenet. Many really important bands, too, in their infancy and later when they were famous.

We also had cafes in many stores because we were temporarily stupid, but sipping cappuccino was not really our idea of a good time anyway. We probably could have turned all the stores into bars like Barnes and Noble is doing, but then when all the nearby bars were driven out of business, where would we drink?

Thirdly, you would understand that people miss Tower because it was all-inclusive, unconditionally accepting of people of all stripes at all times, no exceptions. We got a bad rap for being a bit rude, as personified by Jack Black in Hi Fidelity (as one of your other posters mentions), but in truth our employees were like gruff uncles who might bark at you but still loved you deeply. I believe this simple truth is why so many people still miss and care about Tower, 10 years after its demise.

As the movie made clear, Tower embraced not only every conceivable genre of prerecorded sound but every conceivable type of customer. Every day, old opera buffs would navigate the aisles alongside Grateful Dead hippies and cross-dressing trance DJs. No one was excluded and all mixed daily on the sales floor, along with a lively mix of Tower product buyers and record company salespeople and inventory clerks, all talking about records. It was as vibrant as hell and highly enjoyable.

What is missed by you, and what is one of the primary points of the movie, is that Tower possessed what so many new enterprises do not, an intrinsic authenticity. Tower was great even at its worst despite its best efforts, powered by a natural emerging subculture and its love of prerecorded sound.

If only all our institutions of higher learning were grounded by this type of organic authenticity, more of our children would emerge with wisdom as well as knowledge.

But honestly, what really lit my fuse was your bit about our supposed ignorance and lack of curiosity regarding technology, and this is very personal.

Therefore, I will go into some detail to shine a light on your actual ignorance.

I was interviewed in the All Things Must Pass movie. My bit was more about the magazine I founded and published, Pulse!, than the Internet site and digital projects I instigated and managed. I must admit I was a little disappointed that director Colin Hanks did not focus a little more on our Internet and digital efforts, but honestly, most of those efforts took place in boring offices and not exciting stores. In the end, you can’t fit in everything and choices were made. I was just grateful that Colin and producer Sean Stuart were willing to work so hard to bring our beloved boss Russ Solomon’s life’s work to the screen, and that I got to play a part.

But to reduce Tower’s entire e-commerce effort to our “completely lame e-commerce play,” makes my blood boil. All I can say is "how dare you, man? You have no idea!" You obviously based your gut punch on a throw-away comment from my good friend and colleague Steven Nikkel, who said, “Tower even had a store on AOL, how lame is that?” Steve would probably retract that comment if he could. AOL might be lame now, but AOL was not lame in 1993-94, when millions of people were coming online for the first time in history. It was, in fact, the opposite of lame. It was the hippest thing on the planet!

And Tower on AOL was absolutely the first traditional chain and arguably the first store of any kind, anywhere, to actually sell recordings online, to take money and ship an order. I know this because I am the person that instigated and managed that first AOL store, which, by the way, did over $300,000 in sales that first year and over $6,000,000 in sales by 1995-96, a mere two years later, when we were outbid for the contract by a new company called Music Boulevard, who paid the equivalent of a year’s gross revenue to AOL in a very smart ploy not really to forward the retail business, but to get publicity and leverage the value of their initial public offering. Needless to say, no one remembers them now, though the principals likely have bank accounts that dwarf ours.

In 1995, I also supervised the creation and launch of Tower’s website and managed it until 2002, when towerrecords.com did over $25,000,000 in revenue.

So, just to confirm, we may have been a tad naive, but we were never lame, so again, you don’t know what you’re talking about.

That first AOL store was a total experiment, with literally no budget and all done with sweat equity deals and commissions to our partners. The personnel was just a very small group of people including myself and a few IT guys in our company using a database generously and enthusiastically provided by our good friend Trevor Huxley at our in-store kiosk provider, Muze, who also lent us a database wizard named Jim (I have forgotten his last name), a brilliant quadriplegic that created our store database with literally two fingers. BTW, Muze itself was founded with seed money from Bob Weir of the Grateful Dead.

The fact is, while our senior management, mainly older men born in the 1920s, was not particularly enthusiastic about digital technology — their main love was old-fashioned retailing and the music itself — they were quite enthusiastic and knowledgeable about audio and video technology, but not the Internet so much. Our boss Russ Solomon was an ardent supporter of the CD and the search for ever-better fidelity, which also made him skeptical about compressed sound files, which he considered crap. And he was lukewarm about the odds for the success of Internet commerce, particularly of digital distribution because it did not seem like it could be as profitable as physical goods. So, he was a smart guy who had his reasons, not an old fogey with his head up his ass as you imply.

And to a degree, he was right. It is 20 years later and streaming is still not profitable, though that will certainly change before long.

But I want to make clear that he was, in fact, quite curious. He is the type of person whose mind is wide open at all times. He wanted to understand what might become the next delivery system for recorded sound. And, while I did not get any budget for the web and fulfillment enterprises until around 1995 when we created towerrecords.com, I was encouraged at every step by Russ, a true visionary whose intellect and humanism held every Tower employee in deep embrace, from the newest clerk to the oldest craggy veteran, tens of thousands of people past and present, for over five decades of business life and even today when, retired at 92, Russ is still an incredibly vibrant and curious person. Even now, he is one of the most curious people I know.

And again, I believe the movie makes this abundantly clear. You seem to have missed that.

And, if you had done the homework, you would know that Tower was very involved in trying to enable digital commerce. We were the first to have digital download kiosks in our stores on Sunset Blvd and Berkeley in 1999, a deal we worked on with early digital pioneers Liquid Audio, who created some of the first secure digital download technology.

And we did tons of cross-promotion between digital and terrestrial realms. Our vision was to serve customers every way possible. We were always looking for an edge.

Tower was, I believe, one of if not the very first retailers to do digital/terrestrial cross-promotion. I still have the artifacts from the 1998 promotion (which I believe was the brainchild of Adam Mirabella at Atlantic Records) when we handed out encoded postcards so customers who pre-ordered the Tori Amos CD “From the Choirgirl Hotel” at our cash registers could go to our website and download a free exclusive (actually exclusive too, as in “not available any other way.”) Tori Amos track.

Or the time we worked with Liquid to record the band Jesus and Mary Chain at Irving Plaza in Manhattan, beam the encoded digits of the show to our 4th and Broadway store in the Village via a special T-1 line, then invited the entire audience over to the store four blocks away to get a burned CD of the performance. I forget the exact date, but I think it was around 1998. That was a very challenging and cool thing to pull off successfully, I assure you.

That doesn’t sound anything like the ignorant, uncurious company you describe. Again, you fail, man.

One of the very real problems we ultimately faced was the reticence of license holders. Even though Liquid Audio (whose visionary founder Gerry Kearby died in a car accident in 2012) had created a secure digital wrapper, we could not persuade the powers that be at major labels to license us the content, so we were stuck selling the equivalent of musical shovel ware, old public domain songs no one really wanted.

Record companies no doubt had a right to worry about piracy, but by then Napster had already let the genie out of the bottle.

Record companies had plenty of advocates internally for the idea of more liberal licensing, but the idea just did not fly in the boardroom.

Then, when they realized they were getting killed by burning, downloading, peer-to-peer, etc., they took the conservative path and tried to create their own digital distribution technology, each company creating different formats and standards, ignoring the lessons of the video recorder wars and further complicating things and delaying the evolution of the digital marketplace.

If you want to actually learn more about it, go to CSPAN and search for ONLINE ENTERTAINMENT AND COPYRIGHT LAW: COMING SOON TO A DIGITAL DEVICE NEAR YOU. This was a hearing before congress that took place in April 2001. Don Henley, Alanis Morissette, MPAA President Jack Valenti, the aforementioned Gerry Kearby, myself and several others go to great lengths exploring this issue in search of good legislation to enable an orderly evolution to digital commerce.

Tower Records was also a charter member of DiMA, the Digital Media Association (in fact, I served as treasurer for a time). This also gives lie to your poorly-researched article that we were somehow disinterested in the future.

I would finally just point out that Tower Books was created in 1962, not the oldest book store chain by any means but around for over four decades before Tower's demise, hardly a business we did not know well. Because our company was privately held and we used borrowed funds to over-expand internationally, digital expansion was difficult. I remember when, in 1998, Jeff Bezos floated a bond which garnered him $1.4 billion to fuel his Amazon enterprise. I knew then were unlikely to emerge victorious.

I’m sorry to jump all over you for your numerous lazy mistakes, because I know you did not anticipate a rocket-fueled rebuttal. But that's too bad. I think a person writing for a website called Inside Higher Ed should maybe engage in some.



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