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Introduced by the IMMF’s Peter Jenner, McGuinness made the headlines at MIDEM 2008 by blaming technology companies for the industry’s woes in his International Managers’ Forum keynote. What do you think?


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About Author

James Martin

James Martin is Head of Social Media for Midem organisers Reed MIDEM. This includes defining and rolling out Midem’s social media strategy, editing midemblog, influencer outreach, developing Midem’s fanbase of 75,000+ music professionals and more.

2 Comments

  1. Frankie TAN, Singapore on

    I am new in this industry. Midem 2008 has been an excellent induction and learning experience.
    Digitalization of traditional recorded music processes is not the only market force at work in the industry. Air travel, access to timely information, and the death of distance ensure music consumers are increasingly savvy and discerning in their music demands. Whether engendered by McGuiness’s “hippy-value” technology or “faceless, non-discriminatory” globalisation, the expectations for major segments of the music market have and will continue to change. Understanding, anticipating these expectations and meeting them has largely contributed to Apple’s success in shifting distribution of value in the chain. As a result: this is the best of times for Apple, the worst of times for record companies.
    Music is not content. But similarly, not all music is created the same, as we learnt from Bob Ezrin’s “holy shit” moments. When music is priced as if all music is created the same, what might consumers do? 840 million single tracks in 2007, up 45% from 2006; 450 albums in 2007, down 19% from 2006. Therefore, while music is not the problem, music pricing (to the market’s expectation about value) probably is.
    The industry “revaluation” of music is an opportunity to improve distributive efficiency, which occurs when goods and services are received by those who have the greatest need for them. As Radiohead has experimented with its music (and Starbucks has done for coffee – the coffee market has now more than a few dozen different offerings that cater to price, taste, and quality-preferences of coffee and non-coffee drinkers), the music industry can better differentiate market segments (not just by music genre). So long as marginal prices exceed incremental costs of the new offerings (possible with digital technologies), additional value is gained from those new market segments whose value (preferences) are met. And, as great music and mega-hits gets fewer, ad-supported and subscription-based music as a service also leads to improving distributive efficiencies.
    Many participants (including Paul McGuiness, Elliot Mazer) asked about digital music audio quality at Midem 2008. MP3 was introduced in early-mid 90s at a time of dial-up networks and expensive storage. Creating an MP3 file demands a trade-off between storage and audio quality: the lower the quality, the smaller the file size. Despite the ubiquity of wired and wireless broadband and giga- and tera-byte storage today, digital music continues to be predominantly sold at 128 kbps, 192 kbps or 256 kbps lossy quality formats. Scalable lossless files optimize digital storage to support the distribution of a range of audio quality (from lossy to lossless) to match music playback environments and devices, whether on the move or in the living room. From a consumer’s standpoint, one may choose high-quality and/or convenience depending on individual relative value and preference.

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