Thoughts on the Future of the Music Industry
Updated: Dec 1, 2020
“The absolute transformation of everything that we ever thought about music will take place within ten years, and nothing is going to be able to stop it. I see absolutely no point in pretending that it’s not going to happen. I’m fully confidant that copyright, for instance, will no longer exist in ten years from, and authorship and intellectual property is in for such a bashing. Music itself is going to become like running water or electricity. […] So it’s like, just take advantage of these last few years because none of this is ever going to happen again. You’d better be prepared for doing a lot of touring because that’s really the only unique station that’s going to be left. It’s terribly exciting. But on the other hand it doesn’t matter if you think it’s exciting or not: it’s what going to happen… “ (David Bowie, 2002)
The recorded music industry has been able to dominate format changes and dictate to the public what it can buy. It now faces the prospect of having to compete in a changing market where consumers have become accustomed to acquiring music in digital formats in contrast to “traditional” forms. As access to the Internet has grown, so has the amount of online resources available for users to download music generating a new market behavior having a great impact in revenues. This has affect mostly major record labels, which has seen its main source of revenues being threatened by the digitalization of music.
Regardless of the effect on record companies, there is a large community of people willing to share the music files they have, whether from recording their own CDs onto their computers or by downloading from other online users. This community has continued to grow, despite efforts by the industry to stop it from happening. Not all music files made available on the Internet violate copyright rules. Some bands record additional tracks available for this medium, remixes or live versions of their songs.
As the industry sees current hits and songs available on the internet before they are publicly released, while record companies are dedicated to maximize the sales potential of their recordings, the trend the music markets is showing now and for the upcoming 3 years will definitely drive major and independent labels to find a way to compete in the digital arena and offer something that consumers are willing to pay for now and for. As a result a new model for in the music industry is arising and imminently starting to grow. The new model where bands and artists can make and distribute their recordings is much less expensive. Recording music is becoming less valuable to everyone related to the current and future music industry. This also brings up the question, is the music market going to get saturated as a consequence of the excess of music available in the market? The key issue at this point is about promotion, a new challenge for artist, managers and music companies.
Answers could be found in mastering personal connection with a fan base as the brand of entertainment. Truly great artists engage their audience while playing shows by working the venue. Happening now, artists establish meaningful virtual relationships directly with their audience by building an online fan base and answering online posts and comments and taking the time to interact with their fans. The reach of a live show can be magnified with the orbit and power of a networked online community. To be sure, it is a lot of work to monitor the boards and keep up with the postings, but it is a lot easier than touring 250 nights a year, and the payoff can be massive. This is just like employing street teams to build buzz and selling CDs out of the back of the tour van, both of which are proven tactics to build audience and create direct relationships between artists and fans. Only now the street teams are virtual and the van is open for business in every city across the globe all the time. The name of the game for bands is to know who your audience is and what they like and where they are coming from. You cater to that and you might just have a chance at a career in the new music economy (Kusek and Leonhard, 2005).
Artists, songwriters and producers of the future need to find ways to break through the noise and stand out without significant recording revenue. That model is no longer going to work. Artists of the future are going to need musician businesses built around them that attract audience without relying on recordings to finance the machine, this is being possible today, and it is going to become more commonplace over time. Today lots of small companies are planting the seeds of the future music industry by focusing on artist promotion and creating do-it-yourself tools for bands and their managers. Developing platforms that allow artists to establish a more directly relationships with fans and consumers, helping bands sell digital music directly from web sites. For example with Safesell software, bands can deliver their music online to their fans and keep 70% of the money charged for downloads. This is in contrast to the iTunes model where bands get to keep 6-8% of the download fee (Osorio on McBride, 2006).
Last but not least the future of music distribution is mobile and oriented toward portability. Online transactions and payment culture will support subscription models capturing further music consumer’s awareness. Access to music is a key factor also rather than owning it. The broadband Internet, 3G mobile phones and MP3 players have fundamentally shifted the balance of power in the music industry forever, especially for the young. In reality, this is the way is has been for most artists for the past 50 years. Only now the tide has turned, and the shifting sands of the music business will form around an entirely new promotional model that put music fans at the very heart of the ring.