Biggest piece of advice for artists: If you don’t like engaging with your fans then you are in the wrong business. And don’t tick off your fans by streaming new music on your website and not making it available for sale until weeks or months later. If the fans can hear the music they better be able to download it!
Disclaimer: Everything below has all been said before in so many words. I just felt compelled to put my own little spin on it and aggregate and highlight what I believe to be very important information to take into consideration as you map out your career paths this decade. If you want to make a living in this digital world you need to stay up-to-speed on the trends and changing business models whether you are an aritst, songwriter, producer, music marketer, etc. So without further ado, here’s what I see happening in the music business now:
1. The lines are rapidly blurring between label and management companies where soon they will be one and the same. Distribution (and money) was the main thing labels could offer artists that managers weren’t already doing, but with companies like TuneCore, Reverb Nation, CD Baby, etc. distribution is practically free these days and there are plenty of people that can market your music online and at digital retail. Labels have no choice but to do 360 deals or to try and control as much of the pie as they can. They have to diversify their revenue streams to stay alive especially since music is being used my many as a loss-leader to grow the brand and break through the noise.
2. There’s never been a better time to be an entrepreneur than now. Agents, publicists, online marketing companies, etc. are all starting to offer more services to stay competitive. Labels will look to outsource as they continue to cut staff and managers will look to outsource as they begin to manage everything internally.
3. The CD/DVD deathwatch may happen sooner than expected with shrinking floor space at retail, advancements in Internet-enabled TVs, phones, radios, cars, etc. and with Internet streaming speeds to increase 10 times by 2012. Of course there will always be demand for the highest-quality content from hard core fans and that format of choice for music is looking to be Vinyl. I see a digital and Vinyl world in our future! Start looking for cool Vinyl players now because lots are already on back order!
4. Music (and movies) will eventually live the cloud as we move towards an access vs. ownership world where music is like water available everywhere, anytime, & on any device. Of course you will still want to own the files of your favorite albums and movies so you can always have access if Internet service isn’t available or the companies go under, but you will not have the money or storage capacity to own all the music/concerts/movies that you want to hear and watch. I look foward to watching what iTunes and Lala roll out this year for us! Lala is a digital retailer and streaming service that iTunes just bought and can put all the music you own in the cloud for free!
5. Singles & subscription models will supersede the album. The music biz is moving back to a singles-based economy. The album will never be entirely dead but it may look more like greatest hits bundles of all the hit web singles or discographies of all the songs released over a period of time. Because of the sheer amount of music that is being released on a weekly basis, people will not waste precious time listening to every track released by one artist unless they are hard core fans. They will want to pick and choose their favorite songs rather than listen to full-length albums simply because there is so much music available at our fingertips. They are going to be very selective and only want to play the best of the best. Again, this does not apply to hard core fans of a particular artist. If I love the aritst, I will listen to the full-lengh album over and over again. The goal of every artist should be to acquire as many hard core fans as possible but this will not be easy because of all the noise.
6. Artists need to release more music more often or else fans will forget about them. The Smashing Pumpkins is the perfect example of being innovative and forward-thinking. They are releasing 44 songs over the next year or so released in packs of 4. There is no need to find albums worth of tracks that fit together and focus on one style of music or one theme if you are releasing bundles of music on a regular basis. I think this new model is exciting and will allow artists to be more creative and not take so long to finish a project.
7. Music on terrestrial radio will not be of interest as everything moves online (TV, music, movies, radio, etc.) and you can pick and choose what you want to hear and when. Also check out Bob Lefsetz’s Predictions about terrestrial radio being about news and talk. He’s very opinionated but always makes great points IMHO. Also satellite radio is in deep trouble as well keep your eye on them.
8. The amount of Internet celebs (YouTube mostly so far) and blog stars will continue to increase even if they are only one-hit wonders. A one-hit wonder that gets 50 million views is not a task everyone can accomplish easily right? Old media like newspapers and magazine are in constant decline, this paves the way for new voices to be heard and dominate thier niche like Seth Godin always preaches about. I personally look forward to discovering future blogs stars of tomorrow so I don’t have to waste precious time skimming for the articles that interest me which leads me to my next point.
9. Receive news via niche outlets like twitter vs. mass media outlets like newspapers & magazines. Twitter is a great news filter because you can subscribe only to the feeds that interest you and find out about news instantly before any website or cable outlet can break the story. It’s also a huge bonus that you can communicate with the artist directly via Twitter. Forward-thinking artists are very active on Twitter and communicating with their fans on a regular basis. Twitter is a great tool to keep the fans engaged and maintain a hard core fan base in a saturated industry.
10. Websites emerging as a purple cow will help consumers break through the noise. Filters and trusted sites are necessary in a cluttered media landscape. More than 100,000 albums were released last year. How many people listen to 2 new albums a week and even that would only equate to a little over 100 new albums in a year that they would hear! Websites that aggregate & recommend media like The Hype Machine and Hypebot will lead the way for us this decade.
11. Money will come from building the artist as a brand via direct-to-fan sales & strategic partnerships. Companies like Topspin (who I consult for) are leading the way building cutting-edge marketing tools that allow the artist to easily connect with the fan via email and Twitter and sell their music direct-to-fan from their own website. Also no Topspin logos are visible on the website–it’s all about the aritst! Make sure you are offering up premium deluxe bundles to your hard core fans otherwise you are leaving money on the table. Also Jay Frank, SVP of Music Strategy at CMT wrote a book called FutureHit.DNA and makes many great points as well as offers up 15 tips that you all need to be aware of to generate more money for your music in this digital world. He drives home the fact that increased exposure will translate into ancillary revenue streams be it via royalties, commercials/TV/film placements, ringtones/ringback, apps, merch, VIP access, etc.
In summary, this is what I see happening now and this blog post may be outdated in the next 6 months but I look forward to hearing your thoughts and feedback. Also, please add to it becuase I’m sure I’ve missed or overlooked some other trends currently happening.
Bottom line, keeping hard costs and overhead low is essential to being successful in this new digital world!
Kami
All great points! Thanks for sharing your thoughts. I take a slightly different stance on the “ownership vs access” argument. I don't think that all music will ever be available completely free and on-demand via streaming. You argue that people won't have the money or capacity to carry all the files they want. First of all, storage will continue to grow exponentially (I envision terabyte-capacity thumb drives within one or two years). Secondly, money has never been an impediment to ownership — there's always a free option. But I also think that in order to compete with inexpensive or free streaming subscriptions, the cost of ownership will have to come down. 99-cent downloads and $10 albums are unsustainable, but 50-cent MP3s, $1.99 EPs and $4 full albums (for example) are much more reasonable. Sure, that's a tiny amount of revenue for the artist, but nobody will depend on recorded-music sales as a major source of revenue anyway, and I think cheaper prices will encourage more purchases (especially impulse buys). People don't want ALL the music in the world available to them at all times, but they DO want complete control over the small subsection of music that they enjoy. Streaming doesn't provide enough control or reliability, but ownership does. Just my two cents.
I agree with you. I think you missed the part where I said people will still want to own files of their favorite albums. It's not black & white. It will never be all access I just believe that's where the biz is moving based on the amount of music being released every week I think that's the only way to go. And I don't think music will be free but yes it definitely needs to come down in price. Even 10 cents a track like Lala offers is a good price. But you don't own that track you just get unlimited streaming access to it. Every artist is going can be their own retailer and should set their prices on what the market demands. Just like in the commodity business ya know! Charge whatever the market bears and be flexible I think that's fair. And money will come from the music via royalites from streaming services, placements, etc. It's not just about the purchase. I think streaming royalites will become a nice source of income down the road for artists that get tons of online airplay. But setting royalty rates is still the wild wild west….
I agree digital and vinyl appear to be the way to go and releasing music often at least 2 to 3 times a year with a few sprinkled singles available for free is the way to go…at least thats what I'm shooting for this year
Yea Kami! So true – the fans are the best, and usually way easier to deal with than the suits. BK's album streamed for a bit before being available for purchase and I had groups of fans coming up to me at shows who already had the music on their phones! I guess on the Topspin player there was a “download to real player” option (haven't seen a real player in a hot min), but it was cool bc they were so excited and most likely bought the album, ticket , told a few friends, etc. Analytics on who got it that way might be interesting. I bet the same fans would buy a brand new song a week…or at least check it out.
I have the best story ever about a major country star not making his single available for sale until a month after radio had been playing it and I went home for Christmas and my 16 year old sister had the yet-to-be-released single on her iPod! If you are streaming it, you better be able to buy it or at least download it for free and collect an email address from the aritst's website!
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