Music Industry Outlook

Music Industry Outlook – Where is the music/recording industry going over the next 10 years (projection?)

The first digital music era has almost come to an end. For the past ten years the music business has been shrinking. Sales have dropped for a variety of reasons including unauthorized free downloading and pirated CDs. In some cases the music industry has ignored the power of the World Wide Web.  Now it’s time for collaboration with the internet.  The music industry has reached a new era. The trends yet to come are projected here:

Drastic drops in sales will come to an end.  Although sales in CDs will not increase, online authorized sales are projected to increase over the next 10 years. The trend is already in practice as this theory is already in view in several European countries. Recording labels and/or artists who are mostly newcomers will enjoy the benefit of new online digital downloads, but companies who are not welcoming the change will continue to suffer.

The offering of iTunes is not changed. It is same as it was before 10 years. So, iTunes is perceived as old fashioned. They are having hard time to find better features than their competitors. So, the general idea is that iTunes is no longer the leading player though their dominance over market has been impressive. Market research has found that iTunes has up to 88% market share in US and has 70% market share around the world. Other companies know the mistakes of iTunes and are working toward to make sure that they don’t repeat the same mistakes. Newcomers are already there so in near future we might have a new music industry leader.

Fans are the most important part of entertainment industry. So, in music business they also play a very important role. Researchers have found that the youngsters now do not only listen to music, they watch videos or play videogames at the same time. So the face value of music is dropped to zero because of demographic features. So, fandom is one very important element for any artist or band to survive in this new era. The easiest way to get fan following is through Facebook and twitter. The next move for all musicians should be linking up fans and music using social networking sites. This will help the artist to recruit new fans and he will be able to provide youngsters an appreciable listening experience.

Values are changing hands and are clearly shifting from traditional labels towards internet players (iTunes, Amazon, Spotify and Pandora). They are taking an increasing share of the music revenues. So in future, there will be new entities who will grab more shares. Another noticeable thing is numerous producing and licensing divisions are increasing their market share. Though they are acknowledged and recognized by music industry but they are taking substantial portions of profits from music industry.

Labels will get smarter. Major labels are grasping digital opportunity. They are licensing music on sustainable terms, diversifying their business model, investing in new technology etc. they are even more customer oriented. Major labels have resources and networks to profit from the changes that are currently taking place.

Music is going to be more evolved than ever. Music will actually live in clouds. Music will be less finite product and more infinite product. It will be on demand and for a fee. The collaboration between search engines, record labels and different social networking is going to do the magic.

Release strategies will evolve and we will be seeing a new model for releasing music that will be more welcoming to people than anything else. Artists will offer free, full streams and selected downloads early to the curious and devoted and musicians will have more fan base.

Sources:

  1. http://www.futureofmusicbook.com/
  2. http://www.wired.co.uk/magazine/archive/2010/06/start/the-big-question-the-next-10-years-of-the-music-industry
  3. http://techcrunch.com/2009/03/08/big-music-will-surrender-but-not-until-at-least-2011/
  4. http://www.gearslutz.com/board/music-business/511028-fordism-toyotism-real-future-music-industry.html
  5. http://www.clashmusic.com/feature/the-next-10-years-in-music
  6. http://juggernautbrew.blogspot.com/2008/08/music-business-2012-alternative-market.html
  7. http://rollingout.com/music/music-news/nathan-morris-of-boyz-ii-men-predicts-music-will-be-free-in-10-years/

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