As recent research by Viacom Music Group shows, today’s 13-40 year olds are “practically bathing in music” — which is good news! — but “fans connect with artists through a variety of means and platforms, including TV, social media and concerts”, which makes content hard to monetise. Not to mention the astonishing evolution of formats over the last 30 years – explained in a brilliant animation published by Digital Music News – that makes music monetisation an even more complex topic. How can collecting societies efficiently track copyrights nowadays? Can labels even pay artists their fair share in this disrupted economy?
The figures are quite clear: The Guardian points out that music streams are up and downloads are down, which leaves right holders with no choice – music monetisation must evolve and adapt to new consumption modes. The Daily Beast suggests that the music industry should learn from TV, an industry that overcame similar challenges by “selling content via a profitable subscription model”:
“What happened? Well, the same thing that is happening in the music business right now, namely the need to convince people to pay for what they previously got for free. HBO and its peers have proven that consumers will embrace a subscription-based model for content, but you need to give them a reason to do so.”
Is that the reason why Google is trying to launch a music subscription service, YouTube Music Key? According to TechCrunch, this new service will give its users “an access to an artist’s expanded catalogue – the fan recordings, the live footage, the mixes, etc.”, which could “help differentiate Google’s service from a sea of streaming music competitors, including radio services like iTunes Radio and Pandora, as well as on-demand options like Apple-owned Beats and Spotify.” But Pandora made the news in August as well: Music Ally reports that it recently joined “the billion-dollar music payouts club with Spotify and YouTube”, as it now “pays $1bn in all-time royalties to artists, publishers and labels”. Could the monetisation solution, in the US at least, be this simple?
Industry observers should look beyond the US and take a closer look overseas as well: TechCrunch has pointed out that Soundcloud is finally moving on from its ‘free for all users’ model: it just launched an ad platform, On Soundcloud (photo), which promises revenue for artists via advertising; and is also preparing an “ad-free subscription service”. Not to mention Taiwan-based streaming music service KKBOX, which has just raised $104M to expand overseas…
In this ever-evolving mix of new platforms and experimental subscription services, one thing is for sure: the tech world and the music industry have never been more closely entwined. Indeed, Andrew Dubber claimed recently here on midemblog that technology IS the music industry; but this proximity isn’t always positive. As Bobby Owsinkski put it in Forbes, “music careers are getting trounced by the tech industry when it comes to job choice and availability, and there’s no end to this movement in sight…”
Shouldn’t technology rather encourage the music industry to be more creative? That’s very much the case with Spotify’s latest BandPage integration, which lets artists sell direct to fans (via Music Week); YouTube’s new crowdfunding feature, now live in four countries and bound to be a boon for musicians (via Music Ally); and countless initiatives at this summer’s festivals, using tech to help you find your friends in the crowd, for example, like ClearHart Digital’s NFC-based solution (tested here by Mashable).
Last but not least, there’s still hope for brick and mortar: after going bust just 18 months ago, HMV says it’s set to become the UK’s biggest music and DVD retailer once again, wresting its previous title back from Amazon, reports The Guardian. After the vinyl revival, could real-life retail help music monetisation too? Time will tell!
This is the latest in a series of monthly digests of news curated by the Midem team. Check out our music biz news picks year-round, right here!
Image: screengrab from on.soundcloud.com