future music industry

so, I had to write a report on internet and music, and as I think some of it is quite good, here are some bits :)

Hell Roy if you're checking my work for plagerism, I didn't steal of me don't worry :)

7. New opportunities

Torrents

With so much money being made by torrent and direct download sites it seems very strange that the industry has yet to cash in on such methods. With revenue to maintain severs with the downloadable files, the entire back-catalogue of a label could be available to download from an official torrent site. This would generate some revenue for the label, and because it would be run legally, uploading would be encouraged and download speeds would be increased. The constant availability of the entire catalogue and guarantee that download will not stall will attract more consumers than the illegal counterparts. If each label ran such a site, the illegal sites would soon have to close as the revenue would dry up.

The same method could be used to overtake the subscription services. By offering faster downloads for a small fee, and running adverts the companies could earn much more revenue than letting illegal sites continue. Each year trying to shut down illegal sites costs record companies and associated businesses are very high, a cost which would be negated if the companies simply offered their music free in competition to the illegal sites.

While giving away music may seem detrimental to record companies’ ability to make money, the money made from advertising would be far higher than that lost from illegal download. While CD sales would probably drop with the introduction of legal free downloads, the overall situation would improve for the industry. True fans of bands would still buy CDs, just as many people still buy vinyl currently so the CD market would not die.

Digital rights management

The use of DRM has increased as internet sales have increased. Complaints are common however, with the added difficulty in distributing the song between multiple devices many customers choose to pay for copies without DRM, or to simply download. While encryption and encoding techniques are becoming more sophisticated they never defeat the ways around such protection, at the most basic level a song with DRM can be recorded with a microphone as it is played. There are far more advanced ways around such DRM but with technology as it is, those protecting music will be vastly out-numbered by those pirating it.

Sponsorship deals

Many bands are sponsored by a brand, Jaggermeister are renowned for promoting underground music, from ska-punk to hardcore punk-rock. But now Bacardi are joining in, sponsoring Groove Armada, they pay for all the costs that a record label would, recording, production, distribution and most importantly, marketing. Bacardi does not rely on the artist to sell records; instead it uses them to sell Bacardi products. This method means that album sales are not an important figure in the accounts, taking the pressure away from the artist for album sales. This may be seen as a positive, although it will mean bands are signed according to appearance and how ‘cool’ they appear, and with only one or two singles necessary for the sponsor albums could be of seriously decreased quality.

8. A possible future

It is hard to see the music industry accepting its fault. The industry is too large and too inflexible to accept their mistakes, and to change the business model. Now that bands can create enough publicity to succeed without major support more will follow this new idea. With less people working on each project CD sales will matter less, and the money earned from each concert, and sales of albums, merchandise and downloads will be split in a far fairer way than they are now. While this may seem to mean that thousands of jobs will be lost within the industry, this is not necessarily the case, with each person earning a far higher cut from each sale, less sales are needed from each band to create the same revenue, so more bands can be released. With revenue being generated by advertisers and consumers and music being shared between people with no penalty, good bands will sell themselves. Word of mouth will be the best publicity, and forums for every genre will become very popular.

Unfortunately, with the ease of uploading torrents, there will be the problem of flooding, where there is simply too much music, too much of which is not high quality to wade through to find good bands. This will bring the rise of forums, and where the industry can benefit. By gaining a reputation for suggesting good music, bloggers will be able to use advertising to earn revenue according to their high hit count. Also, record companies will become known for releasing good music, so their sites will be visited more, earning them a more profit.

The subscription services that have been predicted, paid for as part of a communications bundle seems unlikely to me, for two reasons:

First - Why pay for something you can get free?
Second – How can the telecommunications company keep up to date with music releases?

The masses will demand that their subscription service allows them to gain access to everything they can get online, quicker than they can get it online. They will never want to wait for a new album, especially if those using the free internet service don’t have to.


OMG no harvard referencing!