Castle Made of Sand: America’s Recording Industry In recent decades, the music industry as a whole has undergone transformative change. From the introduction of the compact disc, to the rise of iTunes and digital downloads, to the current emergence of streaming services, the way that artists produce music and deliver it to consumers has been radically altered in the past 20 years. As record labels’ stranglehold on the talent search and product distribution side of the music industry subsides, streaming services such as Spotify and Soundcloud have become the preeminent distributors of new music. Their emergence has had a negative financial impact on the artists that drive an industry that has for years been one of America’s largest. Services like Spotify and Soundcloud are erasing the role of record labels in the distribution process, assuming that role themselves while paying small royalty fees to artists and labels for the right to stream to large subscriber bases that typically make use of free memberships. Due to the small number of paid subscribers accessing these services, industry revenue has dropped below $7 billion per year for the first time since record keeping began in 1973 (Seidenberg/Podgers). However, record labels are beginning to reach agreements with these services, ensuring that the labels themselves will continue to profit, and leaving the musician to suffer. And while these services do offer outlets and avenues for new artists to be discovered, the
1.1Summarise the development of the UK popular music recording industry from the 1950’s to the present day.
Ask anyone how they listen to music the answer will likely be through any means of easy access at an affordable cost. A study conducted by news outlet Nielsen 's Music 360 claimed, “Americans streamed 164 billion on-demand tracks across audio and video platforms in 2014”. The rapid increase in popularity music streaming platforms are experiencing leaves people wondering what that means for the music industry. When more consumers utilize the on-demand method of entertainment access, how does that translate to the artist being accessed? Astra Taylor contributes to this discussion in her book, “The People’s Platform: Taking Back Power and Culture in the Digital Age”. She lays criticism upon the idea of a more digitized
When wanting to listen to a song today, one no longer has to buy or download a physical copy. In today’s world, streaming has become one of the top ways of retrieving music content. This major change has led to a profound shift for the music industry and its artists. It has developed a continuous conflict that affects the way music is distributed and how artists make a living. Listeners stream music electronically through their computers, phones, cars, and more. Most of these streaming platforms allow for the content to be free, which directs to the question of whether music should be free or not. Streaming is a topic that has presented itself to be a valid issue on whether it ultimately hurts or helps artists and their careers. Streaming has both pros and cons, but in order to aim to figure a possible solution there needs to an examination of the history of the issue, a proper analysis of both sides, and evaluating its importance.
This case study about the Spotify business model allows a broader vision of what the digital music industry is. In a short time, many companies have developed and managed marked their territory in a highly competitive industry. The start-up Spotify has undergone a remarkable evolution in a financial point of view but also in terms of its popularity. Its various competitive benefits regarding the market leader and its respect for music labels have enabled the company to be renowned and to have a reputation in the real business. Today, five years after its creation, Spotify is certainly criticized in some aspects of
3-4). While these statistics provide a look into the numerical growth of the streaming industry, it is also important to discuss the power that these streaming services have generated—over both the music industry and over established/aspiring artists. Subscriptions are on the rise, having increased significantly over the past ten years, but as is the amount of users streaming music on a free-trial or ad-supported basis—ultimately undercutting the music industry and artists alike. Blewett and Gollogly (2017) elaborate on this point, stating that, by the end of 2016, paid music streaming subscriptions drove a revenue growth of 60.4%—this growth more than offsetting a “20.5% decline in downloads” and a “7.6% decline in physical revenue” (Blewett & Gollogly, 2017, para. 4). Moreover, Borja and Dieringer (2016) explore the concept of streaming even further in their academic article, positing that the decline in paid digital downloads may be a direct result of streaming—as, music streaming can be perceived as a “complement” for music piracy, in which listeners can freely sample music to pirate later on (Borja & Dieringer, 2016, p. 1). The authors also suggest that streaming can provide a “venue for discovering and listening to new releases”; and after completing their 1052 surveys, conclude that streaming increased the likelihood of piracy by
Musical artists across the globe have used a multitude of methods to earn money including CDs, vinyls, and cassette sales. Overtime, new forms of profit and exposure have come into the mix. Artists have lost money due to the changes in the music business. New forms of music distribution includes streaming, downloading, merchandise, and touring. Yet, financial needs also play a role within the music business. Financial methods include endorsement deals, sponsorships, and advertising. Each of these methods may benefit the corporations and the artists. Yet, they do not have a positive impact upon the amount artists earn. Therefore, advertisements, endorsement deals, and corporate sponsorships can bring forth inimical results.
The music recording industry is in trouble. For several years now, sales of new and popular music have steadily declined and show no sign of changing. The record companies are quick to blame the growing popularity of the Internet; music is being traded in a digital form online, often anonymously, with the use of file-sharing programs such as Morpheus, KaZaA, and Imesh, to name a few. The RIAA (Recording Industry Association of America) succeeded in disbanding the pioneer Internet file-sharing program, Napster, but is facing confrontation with similar programs that are escaping American copyright laws. While there is an obvious connection between declining popular music sales and increasing file sharing, there is more going on than the
No one can deny that technology is actively changing the music industry. Production, distribution and sales of music have been affected dramatically within the last 10 years along with artists, composers, and technicians. Most of the changes have been great for consumers, but vastly negative for professionals in the music industry, however a few artists have found ways to adapt to the changing atmosphere of digitally downloaded music and use it to their advantage. We’ve seen music change form from physical, tangible products like records and CD’s to electronic single tracks stored in an invisible cloud. Two major factors in this sudden revolution are online music stores (specifically iTunes) and file sharing websites that allow music to be downloaded illegally.
Is the action of paying by credit card through streaming services becoming the executioner of physical sales? There is no certainty about that, yet it is evident that this invention has influenced in a way people’s behavior, a behavior that has made undoubtedly an impact on the entertainment industry. On the other hand, there is still the old-fashioned way merged with a digital era creation: ITunes store. Royalties collected by the artist from this service can vary depending if they have a record label
“Before the days of YouTube and the Internet, a band 's chances of striking it big depended on record companies. If a band was lucky enough to get a record deal, it gained access to a label 's vast resources and connections. The company paid for the band 's studio time, … and got its music played on the radio, reaching millions of record buying Americans” (Majerol, 1). Now, anyone with talent can post a video of themselves and become an internet sensation, only to then receive a deal with a label to continue growing their career. The issue is, with the Internet came digital downloading, and with the growing popularity of digital downloading came illegal downloading, known as Digital Piracy, which has affected the music industry greatly. This issue affects everyone involved in the Music Industry. From the small CD store owner to the Artist on stage, everyone has and continues to be affected by the growing popularity of digital downloading services. Artists, producers, and songwriters lose an estimated 12.5 Billion USD every year to illegal digital music services. Further, the economic impact from [digital downloading] is an estimated loss of 2+ Billion USD (Storrs, 1). This money affects the “little guys” in the industry and the average worker within the industry.
The music industry is an oligopoly. Since the late 1800’s people like Thomas Edison have been buying up patents in communication technology, forming monopolies, leading to a non-competitive entertainment industry. With only a handful of corporations controlling all aspects of acquisition, distribution and marketing of music, harsh business principles create an exploitative industry that takes the best of what artists have to offer and leaves many of them unable to support themselves. Beginning in the 1950’s with payola and white cover music and ultimately evolving into iTunes and Spotify, the music industry has grown into a billion dollar industry with far-reaching influence and control. Contracts rarely serve the artists’ best interest and many are left out to dry when their usefulness has expired.
When speaking economically, the digital music sector of the international music industry is undoubtably the most important sector in the industry. Within the last decade, music has seen cardinal changes in the way both major and independent labels distribute their products. An industry that once relied on Payola 's and mass distribution of physical records and CD 's now relies heavily on the power of the internet. The first instance of mass distribution of music through the internet was by the service Ritmoteca.com in 1998 [1]. Ritmoteca had a library of over 300,000 songs, offering individual songs for 99 cents each and albums for $9.99. After signing distribution deals with many major music labels such as Warner
In the midst of the United States’ “dot com bubble” (years 1997-2000), there was a surge in technology that brought about file sharing and digital downloads. Threatening the survival of the music industry and introducing a unique set of challenges for the industry to overcome. To remain relevant in the new global market of digital music online, the music industry would have to evolve and change with the introduction of each new facet technology had to offer. The introduction of digitally compressed music files, so easily attainable for a small fee or downloaded legally (pirated) for free, made the music industry reevaluate how to make a profit and protect copyrights. Social media created a visible opportunity for both consumers and artists to maintain digital relationships while providing a platform for consumers to follow and discover new musicians and bands, naturally, making the internet a promotional medium for artists. As the corner record shops closed to make way for virtual storefronts and instant downloads; the internet, digital downloading, and social media made an enormous impact on the music industry that has changed the way consumers purchase, source, listen to, and produce music today.
Artists and record labels are still debating whether or not interactive advertising revenue services such as Spotify will shift the culture of the music industry consumers by discouraging music piracy (Seabrook, 2014) or further damage the industry by reducing paid downloads of songs and albums (Garraham, 2015). Spotify claims that users of its free service eventually change into becoming paying subscribers, therefore doubling the amount they pay for music from about $5 per month $9.99 per month (Spotify, 2015). Reports claim that record labels are placing increasing pressure on Spotify, constantly stressing the need to reduce their offerings on its free service and therefore more accurately reflect the work of artists (Ingham, 2015).
Illegal music downloads have caused a massive fall in the sales and income of the labels and artists, which has been driving them to bankruptcy quicker. According to Li (2015:20), mentions “Each year, the industry loses about $4.2 billion to piracy worldwide”. Between 2000 and 2003, sales numbers fell 16% (Duenner, 2009). After