As I’ve expressed on many occasions in this and other forums, I believe strongly that the days of the need to own music are rapidly coming to an end. That’s not to say, however, that music is now or should be free, far from it. Music had traditionally been paid for by a very small segment of the audience. There is now the real opportunity for artists, songwriters, labels and publishers to be compensated in a meaningful way through revenues derived from on-demand and user-influenced models that are finally taking center stage.
Yesterday evening, MIDEM and TAG Strategic held a networking event at the Sunset Marquis in Los Angeles. The topic: “2011, The Year of the Music Service”. There were over 50 digital and music industry execs in attendance, along with a few artists. The debate, as expected, was heated, but the consensus was stronger than ever. The growth of music services such as Spotify, Pandora, Napster, Rdio, Rhapsody, We7, MOG, Slacker and others will continue exponentially. The $0.99 download from Apple, Amazon, 7Digital and others will continue to decline. The need for ownership will be marginalized by convenience.
On this point there was some disagreement. Eric Garland, co-founder of Big Champagne, expressed that ownership will always matter to a certain segment of the music audience, while Vince Bannon of Getty Images expressed, and I heartily concurr, that ownership is a dated concept.
Vince and I both have Sonos systems in our homes, with access to Pandora, Rhapsody, Napster and iHeart Radio, along with others. These services obviate the need to continue to grow our personal collections at a dollar or euro a track, the economics don’t make sense any more.
In a service-based model, independent music has the opportunity to flourish. John Boyle is President of Hello Music, a new venture that aggregates and augments independent artist services such as Topspin, Tunecore and Reverbnation. He opined that while independent artists are currently underserved, access models offer a better chance for new music to be discovered and gain a significant audience.
I’ve been evangelizing the inevitabilty of the access model taking the spotlight for over eight years, I will continue to do so. I believe that 2011 is the year that access will eclipse ownership as the dominant revenue stream, I’ve bet my career on it.