According to Neil Cybart, the tech industry was rightly puzzled after Apple bought Beats when they already had a music streaming service in – iTunes Radio. There appears to be very little Apple can do to stop the inevitable shift from downloading to music streaming, Cybart said. However, if one looks deeper, there is a lot more riding on this deal than you might think. Cybart believes Apple is looking to reinvent the music industry (again) and place it on a more sustainable track:
[su_quote] The Music Industry needs their “App Store” moment.
A good analogy for today’s music industry is how the software industry looked prior to Apple’s App Store. Before mobile app stores, a developer needed significant resources to distribute and then maintain software, leading to difficult entry barriers for new participants. Piracy was rampant. After the App Store was introduced, it was much easier (and cheaper) to work on software and then distribute product to millions of customers across the world. Similarly, for music, a platform built on software and features can make it much easier for new artists to reach fans while helping to monetize product by building brand equity. While I wouldn’t go so far as to think of a music artist as an “app”, mainly because I think the analogy stops way before that point, it is more appropriate to look at the music industry as needing a revolutionary update, its own “app store” moment, to set it on the right path. The music industry is still going off fumes from decisions made in the early 2000s following the Napster debacle and many are afraid the current indecision may handicap the industry’s next big decision.[/su_quote]
Neil Cybart posits that there are several ways the music industry can be change to “simplify the artist/fan relationship and eliminating many of the music industry’s friction points (monetization, discovery, interaction), results in a scenario where”:
- Music is free, but delivered via a platform where artists rely on software to monetize the brand (image and personality) through merchandising, advertisements, sponsorships.
- Artists have access to information on their fans.
- Artists can set up their own tours including ticket sales, booking venues, and even PR circuits through third-party apps.
- New talent can transition from discovery to monetization quickly without many barriers.
- The definition of “music artist” becomes boarder to emphasize a wider range of content creators.
- Musicians will be CEOs of their brand. The digital product known as music can be thought of as marketing where artists rely on the platform to monetize their brand to loyal fans. Musicians can easily integrate existing social media services (Twitter, Facebook) into this platform, although there could be built-in mechanisms to connect with paid, loyal supporters. There will be plenty of opportunities for musicians to make money from advertisements where appropriate. Maybe a new kind of streaming service can now enter the picture. Additional possibilities can go further into merchandising, concert tickets, branding. As Iovine put it so well, it will be the “business of music” and no longer the “music business.”
All of the above seems plausible except for the “music is free” bit. Not sure many musicians would appreciate this approach.
Image Credit: TechCrunch
