Going Digital? The Effects on the Music Industry of Digitisation and the Internet

Question 1

Digital benefits

Answer 1

benefits but be wary

Question 2

‘digital revoultion’

Answer 2

music industry? who benefits? profound/structural changes?

Question 3

Areas of importance for music and the arts

Answer 3

• Recorded Music
• Publishing (physical to virtual)
• Marketing + promotion

Question 4

Phases of digitization in the recorded music industry

Answer 4

• mid 1970s - digital recordings
• 1982 - CDs
• 1980s - sequencers + MIDI - ‘bedroom studio’
• 1991 - MP3 files
• 1994 - amazon.com (physical sales)
• mid-1990s - public internet
• 1999 - Napster, P2P
• 2001 - iPod, legal MP3 download sites (iTunes 2003)
• 2006 - video streaming Youtube, iPhone 2007, Spotify 2008
• 2009 - 98% singles downloaded
• 2010 - 76% of downloaded music legal
• 2011 - Vevo, 99.3& singles downloaded
• 2012 - Gangnam Style, UK streaming chart
• 2013 - billionth single downloaded, ‘Get lucky’ streamed 1 million times
• 2014 - streaming included in UK singles chart, Taylor Swift off Spotify, 50% of global music revenues = digital
• 2015 - streaming included in UK albums chart, Friday univeral release day, Ed Sheeran most streamed
• 2016 - resurgence of physical (vinyl sales reach 25 year high)

Question 5

The optimist’s POV

Answer 5

• increased quality - digital media less destructible
• increased choice - large quantities of music kept in circulation
• decreased cost - cost of producing + purchasing dropped
• democratisation - musicians have more access to ‘means of production’, distribute more freely without machinery, publishers, record labels
• freedom of expression - no industry censorship

Question 6

Scarcity

Answer 6

• profit making in cultural industries depends on production of artificial scarcity - unique product
• music is art - important + rare = valuable, music should be paid for (Taylor Swift + Spotify)

Question 7

Ubiquity? Bowie Prophecy

Answer 7

before launch of Spotify, Bowie said music will be ‘like running water or electricity’, should prepare for touring (only unique situation tha’ll be left - scarcity)

Question 8

The pessimists POV

Answer 8

-falling sales 1999 $26.bn to 2009 $17 bn
-copyright - increasing source of revenue
-new business models - large record companies have fewer contracts so sell music in other ways e.g. synchronisations (ads)
-decreased revenue from new platforms (e.g. Spotify) where ads/subscriptions are depended on- less revenue for composers/artists/record companies and spreads expectation for cheap/free content
user-generated content creates a new form of exploitation - mass media affect who becomes popular

Question 9

The Value Gap

Answer 9

• growing mismatch between value that user upload services (e.g. Youtube) extract from music + the revenue returned to music community
• biggest threat to sustainablility of music industrt

Question 10

EU Copyright Directive

Answer 10

• aimed primarily at Youtube (who oppose it!)

- aim is to reduce the “value gap” between the profits made by Internet platforms and content creator

Question 11

Digitization in the publishing industry

Answer 11

• 1967-1980s - SCORE (adopted by Schott 1990)
• 1993 - Sibelius (Acorn computers)
• 1998 - Windows + Mac Sibelius
• 2005 - BooseyMedia
• 2011 - Boosey online scores, others follow
• 2012 - Brussels Philharmonic perform using neoScore

Question 12

Pros and cons

Answer 12

digital production of music has narrowed gap between production + consumption BUT:

• publishing - depends on physical product, warehouse + distribution costs remain
• illegal file sharing + privacy risk with printed/recorded music
• SoundCloud + Spotify, composers still struggle to reach audience
• print publishing decline

Question 13

Digital marketing + promotion

Answer 13

• ‘Web 2.0’ revolutionise marketing
• blogging platforms
• MSM/instant messaging
• MySpace (2003), Facebook (2004), Youtube (2005/2006), Twitter (2006), Pinterest (2010)

Question 14

Benefits of digital marketing

Answer 14

• Cost
• Targetability (e.g. Adwords - bid for keywords, Adsense - pay per click, banners, pop-ups, ‘banner blindness’)
• Dissemination - ‘winner takes all’ search engine optimisers - hard to reach large audience
• Crowdfunding - raise money for creative projects facilitated by the internet

Question 15

The network

Answer 15

• Customer Relations Management - ‘practices, strategies, + technologies that companies use to manage + analyse customer interactions + data’ - CRM software (arts venues - Tessitura for ticketing/fundraising/marketing - email when artist you’ve seen is performing again)
• Social Media (Twitter) - message to the masses -Recommendation engines - ‘if you like this, you might like this’ - ‘collaborative filtering’ (LinkedIn) - 6 degrees of seperation