The Music Label
The Challenge
The Downsides of Streaming Services
 
“The bottom line is labels need more revenue than less, and pushing consumers toward lower-revenue models may harm the record industry's chances for a soft landing.” - Glen

In part two of this essay, I mentioned Amazon.com reporting a 119% increase in CD and digital sales due to streaming services such as Last.fm. Once again, anti-piracy combatants are placing blame on music fans for the decline of record sales. Looking past Felix Oberholzer-Gee’s and Koleman Strumpf’s research on how illegal downloading don’t affect CD sales, let us analyze the film and gaming industry. There’s no discriminating when it comes to illegal downloading and file sharing. Anything from ebooks, audio books, movies, games and computer applications can be downloaded and shared on the internet. With the film and gaming industry, even though they are heavily affected by file sharing their profits are still soaring. Why? First and foremost, they allow the consumers to preview before they purchase. Can you rent music at Blockbuster or Netflix? Secondly, they continue to add value to the experience they are providing. If the film industry followed the same route as the record industry, we would still purchase movies on VHS. If the gaming industry followed the same route as the record industry, we would still purchase Nintendo cartridges. My question to the record industry; what is wrong with allowing the fans to listen before they purchase? Are you afraid that they will realize that the quality of music has declined significantly as you claim sales have? I think they’ve already come to that realization. And I can attest to that as a die hard music fan.


The Opportunity
Why the Labels Love Play Anywhere

“The new service puts personal music and video collections onto the “cloud” and enables subscribers access and play across multiple devices including mobile, PC and in-car regardless of DRM and formats.” – Hypbot Site

As Gerd Leonhard, author and media futurist, would say, “Music Like Water is the new ecosystem”.  Water flows freely any and everywhere. You can turn on your faucet and receive water or you can purchase water from the store. Will music ever be as free as water, with the option of purchasing sound in a concealed package? Well, the question holds true because illegal downloads would be considered free music and sound in a concealed package would be considered a music CD. Gerd has been talking about a subscription based model for music since 2004, where ISP’s (Internet Service Providers) would add a small fee to your internet bill for unlimited access to music. Although this may take some time to bring into fruition, we’re beginning to see the beginning stages of this music utopia. Play Anywhere is a subscription based service, who supply their service to device manufacturers, telecoms companies and ISPs who can then offer it to their user base either as part of their package or as an extra. Their system is setup to where any song you listen to, whether purchased from iTunes, ripped from a CD, or downloaded from an illegal BitTorent site, will be tracked – even if you’re offline. This information will be tracked by their system to determine how much money would be distributed to the right’s holders. The only concern that music fans may have with this model is their privacy. 



 


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