Future Of Music

In the face of insurmountable odds I feel a competition is in order.

Here’s a pretty telling graph – Recorded music sales over time since 1999.   This is the truth.

If you are trying to make money selling recordings, or producing them you are selling into a market that is auguring into the earth.  If you are a pure-play label – either cash out soon and go home before it’s really too late, or start writing a new business plan.  It is time for you to start over.

If you really want to do 360 deals, then get the capacity, personnel and expertise to actually produce results or you are toast.  Todays nimble entrepreneurs and emerging music service environment is going to eat your lunch.  Specialization is in, generalization is out.

If you are a record producer or engineer, create other products to produce.  Broaden your horizons.   What are you going to be a producer of?  What “insanely great” product can you create?

If you think you can survive in the recorded music business, find something else to sell.  Simple as that.  There is no recovery from this decline.  Sure songwriters and publishers can still make money licensing for film, TV and new media (like ring tones), but the engine that has driven the music business for the past 60 years has run out of steam.

Recorded music as a propellant into prosperity is no longer viable.

Accept this fact, move on and adapt.  Use this as a jumping off point.  Reinvent yourself or your business.

This has been my mantra for the past 6 or 7 years.  If this RIAA graph above is not evidence enough, then I don’t know what is.  If you think being signed by a “record label” is your ticket to ride, then nice to have known you.   Enough already.  I can’t believe how many people still want this.  American Idol?

And if you are the RIAA, and think trying to preserve recorded music as a “business” is a sound investment, I would advise you look for another job, and soon.  Gaming Soundscan to count T-Shirts as a way of propping up the numbers and thinking everything is ok is self deception.  Look around you.

This is the truth people.  Recorded music sales are going to end as a viable business driver ’cause it is just not working anymore and is an outmoded concept of what music was all about.  “Digital” tracks are not going to cut it as they have been conceived thus far because it is just the same thing in a different form.  Fixing music in time makes no more sense.  Music is more fluid than ever.  Subscription revenue and streaming licenses are not going to support anyone when they are optional.  We need something new, something bold.

With this as a background I created Music Power Network.  To help people discover the future of music for themselves, and create a plan to take their careers forward.

We have to dig deep here.  This is a time to be honest with ourselves.  What is your music career all about anyway?  How are you going to survive?  What are your goals and your dreams?  How do you define success?  You can’t eat passion and you can’t spend perseverance.  What is your business plan?  What is your marketing plan?  We need some new ideas.  What are you going to do?

It is too easy to say that a 360 model is the way to go.  360 for who?  You or the “label”? What do you really need?  Who is actually going to provide the services required?  What does the team look like?  Where is the value, talent and capital going to come from?  Who is going to back your vision?

Think you have it figured out?

I am going to put together a team of people to search for the best new music business plans for musicians, songwriters and producers.  In the coming weeks we will put this competition together and announce it officially at SXSW or sooner.  Details will be forthcoming on how to enter, who the judges are and what the prizes will be.  I promise you it will be worthwhile and interesting.

So start working on your strategy and your business plans.  To be notified when the competition is announced, please click here and enter your email on the bottom of the page.

Please leave comments below on any ideas you have for judges, prizes, people to reach out to, etc.

Dave

The music industry is being reinvented before our very eyes. Learn how it is developing from today’s entrepreneurs including Ian Rogers from TopSpin, Steve Schnur from EA, and Derek Sivers and how you can capitalize on the changing opportunities.

MPN is my latest project and an online service for music business people and music and artist managers creating the future of the industry. MPN provides online music business lessons, exclusive video interviews and advice, career and business planning tools and thousands of specially selected resources designed to help you achieve success in this ever changing industry. MPN gives you the tools, expertise and guidance to help you get organized and take your music career to the next level. Learn from industry experts, set your goals and realize your vision.

T H E F U T U R E O F M U S I C

In our (2005) book we wrote about the “Universal Mobile Device”

June 1, 2015. Our Universal Mobile Devices (UMD) are “always-on” at 8 MB/second, and we have anytime-anywhere access to music, films, games, books, news, streaming video, online banking, stock market transactions, instant messaging, e-mail, and chats. It’s a global telephone, a digital communication and data transfer device, a Global Positioning Device (GPS), a personal digital assistant, a music/images/film storage device, a recorder, a personal computer, a gaming platform . . . and much more that we haven’t even gotten around to trying yet. Still, it is only a little bit larger than a cigarette pack, its processor is one hundred times as fast as the good old Intel Centrino chip, and with over 5 terabytes of data storage, there is plenty of room for anything we want. Our UMD can project a fairly large and sharp image onto any white surface, it can set up instant secure wireless connections to other computers, beamers, monitors, screens, and printers, and it can connect to other UMDs to exchange data and files, instantly and securely.

The UMD “off-road” version is so durable that you can drive a truck over it, or leave it out in the rain for a few days. Ten days of battery power lets us forget about hunting for electric outlets everywhere we go. In short, our UMDs are irresistible, and sometimes we even struggle with ourselves to put them away.

And how much do we pay to get this device and the wireless service? Less than what a year of dial-up Internet service used to cost only ten years ago. Speaking of those days, we are so relieved to have lost all the cables, the multiple billing procedures, the restrictions on usage, the endless calls to customer service to figure out how to make it work, the non-compatibility, and all of the other burdens. Now, the pricing—and what you get for your money—is so compelling that everyone considers it a part of their basic expenses, like the phone bill, cable television, or car registrations.

Today, the basic content service comes packaged with the monthly service fee, and a content levy is imposed on the device itself. It took ten years for the device makers, software providers, and entertainment companies to agree on a voluntary compulsory licensing scheme, but now the content providers make much more money than they did before UMDs were around. In addition, their marketing costs have shrunk to one tenth of what they used to be, their delivery costs keep falling, administration and accounting is handled by smart automated software agents, and their legal budgets have been reduced to a fraction of what they used to be because there is nothing left to sue for. Finding cool new stuff rules the day. Get our attention, and let us make a connection.

Music companies, book publishers, game companies, and filmmakers are eager for us to check out their stuff, watch their films, play their games, or try their software. The more of their content we use, the more they get paid, pro rata. We still pay the same flat fee, unless we select some premium content—which we do all too often, we have to admit. It may cost only a dollar to “sit-in” on the latest recording sessions with your favorite artist, to order a copy of an issue of Twilight Zone that is not on the UMD Network, or to watch a special backstage Webcast of the Grammy awards. Our UMDs make media and entertainment content so irresistible that our cash just keeps flowing out on the network—a “dream come true” for any content provider that can get our attention.

The UMD service and its built-in tracking software allows the content providers and their agents to find out how their content is doing on the network—how many people have tried it, how many people have shared it, how many people have rated it, and who is talking about it. If we want to, we can share some, a little, or all of our data and other feedback with the UMD service, our friends, or the content providers themselves. We can also provide detailed feedback on their content and earn free UMD “points” that we can use to get free stuff. This way, some of our friends even make more money on the UMD network than they spend on getting the content! They review new bands, recommend new songs and movies to their peers, test new games, or become part of focus groups that evaluate new UMD services.

No longer are we tethered to our computer, the LAN connection, or the power plug. UMDs have become as commonplace as cell phones were a decade ago. Gone are the days of having to worry about where to get cool ring tones, how to turn the cell phone into a real gaming device, or where to watch our favorite soccer game.
The UMD comes fully licensed, and we can do whatever we want with it because most ways of using it are simply already included in the price of the device and related service fees. “Fair use” rules and, as customers, we really like the sense of empowerment. If we want access to special content, we simply use the various premium billing options that bill our UMD accounts, deduct directly from our electronic bank accounts, or use any of the cyber-cash services that we can subscribe to.

So what about the prices? It’s 2015, and we’re paying $59 a month to get all the basic content on the network for free, plus of course, thousands of minutes of free voice and videophone calls. Stream it, download it, listen to or view it on demand, transfer it, share it—whatever we want, anytime, anywhere. Peer-to-peer has taken on an entirely new meaning, and it smells like roses to the content providers and media companies.

Best of all, the sheer amount of content on the network is more than we could ever consume: more than five million music tracks from almost any record label, producer, or lately, directly from the artist. In addition, there are more than one million books; two hundred thousand movies, television shows, and video clips; twenty thousand games, and thousands of software packages. And we are talking about the good stuff here, not just back catalog and “archives.” These offerings are instantly available, instantly archived, bookmarkable, searchable with our content agents, and cross-referenced with our network buddies and friends. The only thing we are really missing is the time to try it all!

——

Sounds an awful lot like an iPhone or Blackberry Bold to me. The only thing really missing is the processor power and storage, and then some agreement about global content licenses and a little clearer thinking on the part of copyright owners and we’ll be there.

2,015 is only 6 years away. You know what, I think we are going to get there way before that.

Forrester predicts the number of MP3-capable phones will grow from around 50 million to 240 million, or 75 percent of the US, by 2013. That pales in comparison to the mobile revolution that is occurring in Europe, Asia, Latin America. Basically the entire rest of the world. This is the future of music.

Sales of digital music in Latin America jumped over 50 percent according to the IFPI, more than twice the global average increase. Most of the sales in the region are dominated by downloads to wireless phones or embedded music on the devices.

The mobile platform will bring huge catalogs of music to our pockets coupled with, tickets, social networking and commerce. This is going to completely change that we interact with music. My iPhone with Shazam, Pandora and Twitter is already amazing. I can’t wait.

Here is a comprehensive map of sites driving the future of social media. From Overdrive Interactive, an online marketing services firm that really gets it. Enjoy and proliferate.

Kevin Kelly is off the hook. This is a must see video.