According to leading music futurist Gerd Leonhard, such diverse approaches are just the start of the “complete fragmentation of the music format”. With the convergence of audio, video, graphics and gaming via the net, he predicts the album will soon be eclipsed by the music ‘experience’, embodied in any combination of apps, interactive videos, augmented reality apps or a 3D television concert using interactive controllers like Microsoft’s Kinect. “We’re going back to the understanding that playing music is about an experience, not about a download for the cheapest possible price,” he explains. ”With apps and websites and 3D, I’m given an interface which makes it easier to immerse myself in the experience… You can’t copy that. If you can get immersion from your fans, you have their wallet.”
114 posts categorized "Music Flat Rate"
September 19, 2011
July 27, 2011
May 12, 2011
MIDEM just published an exclusive video with me: check it out below. "In this exclusive video post for MIDEMBlog, media futurist & CEO of The Futures Agency cites Guy Kawasaki's notion that we should be "bakers, not eaters," or contributors to an "ecosystem", i.e. a collaborative economy, as opposed to an each-to-his-own "ego system". Food for thought!
May 03, 2011
March 09, 2011
CNET's Rafe Needleman and Greg Sandoval (2 people whom I follow closely and whose work I really like) have cooked up a smashing 33 minute roundtable (video) with the notoriously tenacious music-business disruptor Michael Robertson (MP3.com founder, MP3tunes creator, now CEO of the very interesting music / radio cloud-recorder service Dar.fm).
The video covers just about all angles of the music industry and provides a great overview of everything that's wrong (and could be righted, I guess) in digital music, and Michael sure has all the right answers to some pretty tough questions. In fact, for most of it, I couldn't have said it better myself:). Check it out. Michael and me do have a few things in common, as far as the message goes, I guess...
March 02, 2011
It was a pleasure to give a talk for my alma mater, Berklee College of Music, in Nashville (TN) yesterday, on the topic of monetizing music in a networked society (see the Facebook page). You can now browse the entire thing via Slideshare, below, or download the low-res PDF directly from here. Provided under creative commons attribution non-commercial license, as usual. Feel free to share and re-use.
January 15, 2011
It was a great pleasure to be back at the annual Noorderslagt / Eurosonic Event and Conference in Groningen (NL) and present a 60 minute talk on Context, Copyright and the Future of Music, in addition to hosting and moderating a panel called "Is Copyright the Devil" (whew... juicy headline...). I really tried to dig in even deeper as usual, and describe a plausible way forward for the music industry. Hopefully I succeeded... you be the judge of that.
After my talk, I had a spirited panel / conversation with Hans Bousie (copyright expert and cutting-edge Dutch lawyer) and Arda Gerkens (former Dutch parliament member for the Socialist Party) and really enjoyed it (and hopefully, so did the audience, see the tweets).
In my preso, I touched on quite a few topics including the Networked Society, the future of copyright, the need for a public digital music license, the shift from copy to access, and the new revenue streams for musicians, artists and composers. Check out the slideshow, below, or download the low-res PDF from here: Gerd Leonhard Context Groningen Music 2.0 LOW RES 6 MB PDF
January 13, 2011
Check out this short video on the topic of "Music Like Water".
January 07, 2011
2010 brings further decline in U.S. recorded music sales, time to face it: access will indeed replace copies.
Nielsen has just published an interesting report on 2010 recorded music sales in the U.S. Before I comment on what it all means here are some of their factoids:
- Overall Album sales (including albums and track-equivalent album sales) declined 9.5% over 2009
- Total album sales declined 12.7% over 2009
- There were 240 million physical album sales in '10; a decline of 19% over '09
- Digital music accounts for 46% of all music purchases in 2010; up from 40% in 2009 and 32% in 2008
- Most importantly, in my view, while CD sales are (of course) declining further, digital sales have slowed down to a crawl i.e. there was only 1% growth from 2009 to 2010.
- The industry's digital carrot (*very small) & stick (*very large) strategy is failing. Most people won't buy units / single tracks / downloads / copies any more - they want unfettered ACCESS, total choice and user control (ouch), utter ease of transaction while limiting their costs, and above all, fair and irresistable deals. Not that any of this is new, really - but maybe this message can start to arrive, now?
- The only legal game in town that really works as far as music is concerned, is iTunes, and that model has made Apple into the undisputed king (some would say, emperor) of digital music - software, hardware & devices - but less and less people are actually buying music this way, i.e. by-the-unit and at a significant individual price point. Plus, most of those kind souls that have indeed purchased something this way eventually stop buying as they reach certain spending limits (in my case, approx. $800). iTunes essentially punishes interest in new music because it makes us pay to download tracks we may not know, yet - hardly a model that will work for kids with tight budgets, and also a major reason why the much discussed longtail concept has not really panned out yet, as far as music sales are concerned.
- Just like - sadly but again very predictably - we are seeing with the iPad, once the initial 'wow' factor and geeky excitedness is fading, only a very small fraction of the users will continue to buy content in the 'pay per unit' way that Apple is enforcing and that the record labels, studios and publishers have been clinging on to religiously.
- The future is - as I have said many times in the past - in providing ACCESS to music, not in selling copies of it: unrestricted, unprotected, most likely flat-rated or bundled (think: ISPs and telcos.. and Facebook!), possibly feels-like-free or freemium i.e. ad supported (for a basic starter-level, at least), highly curated, socially hyper-connected, mobile, location-aware, nicely packaged (appified), with loads of extra values and upselling offers (think: downloads of live concerts, HD versions of streams, 3D etc), cross-media and multi-platform.
Let's face it, guys: there is loads of new money here, people are spending money on digital content. All you need to do is to let go out the idea of controlling distribution, selling copies and running your nice little empires that can tell 4 Billion connected consumers what to do, how to behave, and how to spend their money. You need to license the likes of Spotify, Simfy, Mog, Rdio and Google, globally, and help them turn bundled access to music and 'the jukebox in the sky' that Napster 1.0 was already hinting at, into new revenues.
This model needs to be co-created, not funded by VCs - and your strategy of milking innovative new ventures and entrepreneurs for a quick cash fix is killing the future before it even has begun.
The future is music (and most other 'content') in the cloud, where streaming will equal downloading (ouch... I can hear the lawyers are moaning), where branded content rules, where really smart / mobile / social advertising will pay for a lot of 'free' content (like it always has, btw) and where you can upsell all kinds of other music-related products to 80% of the 'people formerly known as consumers'. Not only that but you'll also save a huge amount of marketing money since you'll know who they are, where they are, what they like, and what they think (by communicating with them).
And it gets even better - they may even start to like you again.
- My free books, Music 2.0, Friction is Fiction etc
- Mobile version of Music 2.0 book (also free)
- Search for "Music Like Water" inside of The Future of Music book
- My talk on "Compensation not Control" (video) (Midem 2009)
December 28, 2010
It seems like every single day I read about how Internet and mobile companies are struggling to obtain the rights for what they want to do, whether it's about music, videos, TV shows, films, articles, text and images.
Here are some quick examples:
- GoogleTV just can't seem to get the TV studios seriously interested in allowing them to even search their online offerings, while...
- Netflix seems to have been more successful at tackling this wicked problem of content licensing, at least to some degree, by - as cnet aptly puts it - 'building relationships in traditional means' (I guess this means playing nice with Hollywood? Read the article - those are good, old-fashioned golf-club paradigms I'd say)
- Spotify is a fantastic music service, no doubt; very much along the lines of what Dave Kusek and me envisioned as 'music like water' in our 2005 book 'The Future of Music', and subsequently expanded on in my follow -up book, Music 2.0 (free PDF here). Spotify is not officially available in Switzerland but I have been successfully using it via a UK paypal account (after trying simfy.de and not getting anywhere with their really awkward and crash-prone iPhone app). Unfortunately, Spotify just can't seem to get the music labels and national rights organizations to bless their launch in many other territories, including the U.S. (read this Slashgear piece for more details ). All of this - you guessed it - because the record companies and the music publishers have not agreed on the licensing and deal terms for those countries, yet, and despite the fact that Spotify is already spending most of its VC money on paying for the music licenses. The fact is that there are no compulsory licenses available for on-demand streaming and flat-rate access services so unless these deals are negotiated nobody can touch it. Read about it here, or here (my Spotify-related blog posts), or via my July 2009 blog post on specifically why I think Spotify is unlikely to survive, or peruse the Zemanta-enabled links below for more enlightenment by some smart people
So here is the point I am trying to make: I don't think a purely free-market-driven and unregulated approach will work, in the future. Many large, incumbent media companies, publishers, record labels and other traditional intermediaries (i.e. the 'industry' as opposed to the actual creators) have every reason NOT to be flexible or even slightly forthcoming with their licensing terms and thereby support the deployment of new cloud-based, access-on-demand and flat-rated services. This is simply because their very existence may quickly and irreversibly change the entire playing-field, and may make it very hard for the incumbent rights-conglomerates to continue to effectively control distribution (and by extension, advertising prices) in the same way as before. These changes aren't for the better when you currently run the entire show, so why should you agree?
This is why Warner Music Group's Edgar Bronfman has said many times that he will not license any unlimited streaming-on-demand service, why Netflix - despite of (or because?) its vast growth - has been back and forth with the Hollywood studios on getting more content deals done, and why Hulu is losing steam because of the studios' concerns over future cable-TV revenue streams. Clearly, this is all about controlling and milking the market (i.e. the 'people formerly known as consumers') as long as possible. Yes, sure, just like the big telcos used to do before they had to let competition in. This is not about 'getting the artists / creators paid' or about fighting digital piracy - it's about maintaining a comfortable and lucrative monopoly position for the longest possible time. Which is OK, too - if it wasn't for the criminalizing effect it has on every single Internet user.
Most large, international media companies (disclosure: many of which are or have been my clients in some way or the other) and almost all major TV, film and music rightsholders are used to absolute control over the distribution of the works (and artists / producers) that they own or represent, and this simple fact used to result in getting much higher license fees - the other party had no choice but to take it or leave it; no license simply meant no (legal) business. This may sound somewhat reasonable in a mostly offline world (i.e. until just recently, when the mobile Internet started to take of), but on the Net, in a truly networked society, this kind of thinking plays out quite differently: refusal to license at a price that is affordable (and / or financially viable for a new, potentially huge but legally unprecedented player) simply encourages and produces piracy, because the desired content will become available anyway, legal or not, one way or the other. The reality is that there is no real control of distribution of digital content, any longer, and all models based on re-achieving that control will fail miserably. Witness the 100s of illegal movie sites that now stream pretty much any movie on-demand, or the many new IP-cloaking and re-routing services (commonly used to access locally restricted content services) that are currently flooding the market. Not licensing content to new players on actually survivable terms simply lets other, parasitic entities prosper by offering it without permission. Everyone loses.
My thesis is that - just like telecom deregulation - we urgently need new, open and public mechanisms that first significantly encourage and then possibly even enforce the licensing of copyrighted works for new services that require a new and more experimental approach, and that may end up serving the consumers much better than the traditional services. A 'use it or lose it' rule may be useful to that end; and as far as music is concerned I have been proposing a new, public digital music license for a long time.
In any case, I think that a system that continues to be based on deriving future benefits ONLY for the largest and most powerful rightsholders (again, by that I do not mean the actual creators, but the industries that represent them) is, in my view, simply unsustainable and socially indefensible in this dawning broadband-culture and in a connected, networked and interdependent society. We need better and more transparent EcoSystems and less EgoSystems; less empires and more Open Networks.
Let me have your feedback please!
September 04, 2010
From the June 16 Music Conference in Ireland, see more details and my presentation here.
September 03, 2010
I am honored to have the pleasure of working with Ericsson on a few of their pretty cool future-oriented activities, including the 2020 ideas project and the PressPausePlay movie. Here is what Ericsson says about the 2020 project:
"...Broadband connectivity and mobility are changing the way we live, the way we work, the way markets function, and the way societies operate. At Ericsson, we need to collaborate and get inspiration from people outside our business in order to adapt to these changes - people that take a stand, and that want to share and work together. which I think is just fabulous. In 2020 – Shaping Ideas, we ask 20 thinkers to share their view on the drivers of the future and how connectivity is changing the world. They describe a future where a growing population faces never before seen challenges and opportunities; where digital natives will shape their lives and the enterprises they work for, and where technology could create a global golden age...."
This quite snazzy video, below, was just released I believe, and it features me talking about one of my chief memes: the Future of Music and Music Like Water (a theme that I developed with my FutureOfMusic book co-writer Dave Kusek, but that originally goes back to David Bowie in the New York Times, see the picture above).
Naturally, there is a ton of stuff available online, on the Music Like Water riff, but if you want to start somewhere, check out my follow-up book Music 2.0 (free online / mobile version here), my MidemNet 2009 video "Compensation not Control", and my various slideshares on related topics, here (one of the best ones is 'making money with music when the copy is free')
August 16, 2010
16 August 2010
The main shift is going to be away from the downloading of content and owning of CDs and more towards music in the cloud. That is going to happen with most media, starting first with music and then going into films and books. This is not just a music business issue. We are moving away from the copy to access. This is a very good model for the artist. In the past, most of the money was spent on the physical product – so the reproduction, packaging, shipping and retail store.
The artist basically got nothing in most cases. Skipping that whole process now means that the brand of the musician becomes the most important thing. This is very good news for the artist, the producer and the creator but less so for the industry as it’s much easier to sell a copy than it is to sell access. The idea that the artist just gets, say, 10% of the sold product is now out the window. Now the artist will give his agent or service agency some kind of fee – say 25% just as Nettwerk Records and other companies are already doing.
The issue is to get attention and clicks from consumers. If that attention is converted into a revenue share based on advertising, a subscription fee or an upselling process, then as soon as you have attention, you participate. We are still in the old system of counting on revenue per use. That won’t work in the future. The bigger your brand, the bigger the attention you will get and the more clicks you get, the more money you’ll make. I believe that consumers will ask for the access models to be free initially but then after they use it for a while they’ll be quite happy to pay so they can remove the ads or increase the quality of the stream for example. Music online will feel like free. There is plenty of money to be made from ads, but it’s just not there yet. It’s coming, though. We have seen that advertising just doesn’t work on the Internet.
It’s so easy to click away the ads or avoid them altogether. Advertising was essentially useless until now as today we are starting to see social advertising, such as on Facebook. Plus we have mobile advertising. Finally advertising is becoming more useful. The brands are no longer looking to spend 1% of their budget on social or mobile; they’ll be spending 10% or more. There is a total disconnect between the way a new business can be grown and how a lot of rightsholders perceive how the business will be paid for by Google or ISPs, for example.
That’s a very bad approach because it makes it impossible to legally grow a new model. You will be much more successful – like YouTube and Last.fm – if you don’t have the right licence and you just do it. That’s a real irony. I don’t think we’ll be able to support new services without a compulsory licence.
We need a compulsory licence for music use on the Internet so that companies like Spotify, MOG and we7 can use a licence rather than just bang their heads against a wall like they have in Germany and the US. A cloud-based model has to win out in the end, as the costs are so much lower, the sharing is so much easier. You can put all sorts of ads into cloudbased systems because you always know what the user is doing. There are lots of great benefits there. But the industry hates the cloud-based model as they lose control over distribution.