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Paul Resnikoff in Los Angeles writes about how different platforms are converging and will become nearly indistinguishable from one another and how that will change the patterns of licensing. Check it out at Digital Music News.
One of the more interesting panel discussions of the Leadership Music Digital Summit yesterday was “Digital Retail: What’s The Future?”
On the issue of the future of CD product, UMG Nashville EVP Sales, Marketing & New Media Ben Kline said, “I can’t imagine CD’s ever going away. I can’t imagine Wal-Mart and Target not selling hard product. It’s the ones (retailers) in the middle that will be hurt. I don’t think you’ll be able to walk into a mall and purchase a CD.” Kline went on to comment, ”We still can’t afford to be in the singles business” when asked about the current state of selling digital singles and why labels are not being more singles driven.
One of the major discussions prevailing was how to grow digital sales as CD sales fall. Each panelist had their own ideas including:
- Better devices
- Ubiquitousness
- Multiple product offerings in one bundle
- Player compatibility and coordination between platforms
- Exceed experience of music ownership with consumers
- Stop narrow focusing on subscription based models
On the subject of future business models within retail, the industry vets responded with:
- Ben Kline: “Demand price models (where price is equal to the demand of the music). Not every song should be .99 cents.”
- EMI CMG VP Sales & Marketing Mark Adkinson added, ”Steve Jobs can’t run our business for us or he will run it right into the ground. He wants to sell devices, not music.” Mark also stressed the need for pervasive distribution within the music industry.
Leadership Music Digital Summit is going on today in Nashville. The keynote was delivered by the CEO of iLike, Ali Partovi, who mentioned that it was the first keynote he has given.
With all of the questions, concerns and potential regarding the future of music technology, Ali made a point to say, “What I’m most excited about is the discovery and promotion of music”.
Ali compared traditional broadcast media with new media:
**Traditional media is “untargeted, focused only on hits & singles, while album development suffers”.
**Digital media is “personalized, social, syndicated, targeted and enables artists to pursue their dreams.”
Partovi went on to say that digital media “could replace or solve the problems of traditional broadcasting”.
More highlights from the Digital Summit will be posted this week.
Chris Anderson & economist Jacques Attali speaking at the 2007 Midemnet Forum about the future of the music business. The revolution is happening……
Boston Business Journal published a new report by Forrester Research Inc. that shows that half of all music sold in the U.S. will be digital in 2011 and sales of digitally downloaded music will surpass physical CD sales in 2012.
The report also claims that digital music sales will grow at a compound annual growth rate of 23 percent over the next five years, reaching $4.8 billion in revenue by 2012. In contrast, by 2012, CD sales will be reduced to $3.8 billion.
“This is the end of the music industry as we know it,” said James McQuivey, vice president and principal analyst at Forrester Research, in a statement. “Media executives eager to stay afloat in this receding tide must clear the path of discovery and purchase, but only hardware and software providers can ultimately make listening to music as easy as turning on the radio.”
McQuivey, a former professor at Boston University, tells record executives to cheer up because there are ways to rise from the ashes. He says first, the industry should quit fooling around with music subscriptions and ad-supported models. People want to own their music and downloads have won. Only 7 percent of adults on the Web say they have ever tried a subscription service, according to the report.
In a final note, McQuivey suggests that music artists, who have historically looked down their noses at advertising, had better change. He says the industry should rip a page out of NASCAR’s playbook.
“Artists who used to pretend that their platinum album success was really about their “art” will no longer have that luxurious pretense because labels won’t sign them unless they agree to a barrage of sponsorship opportunities,” McQuivey wrote. “There will eventually come a day when Chips Ahoy will contend with the Keebler Elves over who can be the official cookie of the Taylor Swift world tour.”
