the future of music: creators, consumers, and the in-betweens (aka industry)
Post on 15-Sep-2014
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This is a version of the slides I presented at a talk I at the SKAP / DFAM event in Stockholm, Nov 28, 2013 see http://www.futuristgerd.com/2013/11/28/my-presentation-at-dafm-skap-event-in-stockholm-today-pdf-a-futuristic-outlook-on-the-creator-consumer-the-business-in-between/TRANSCRIPT
FuturistGerd.com@gleonhard
A futuristic outlook on the creator, consumer & the business in between
Photo by Michael Cordedda - http://flic.kr/p/9cDmTe
Most of what I am about to share with you is actually good news…
Photo by Dr Case - http://flic.kr/p/5fiGgf
Music: is Sweden (and Scandinavia) showing us the future?
E-M-P-O-W-E-R-M-E-N-T
☯Music Creators
Digitization
Global Transformation driven by Digitization: When Products become Services and Experiences, the creator becomes even more crucial
Product ExperienceService
@gleonhard
All media is shifting from protection to engagement
Photo by WallStreet Journal.com
Maybe this is a good time to…
@gleonhard
rights licensing across Europe?
Disembodiment of Media
@gleonhard
The rapid disembodiment of music will force us to create a collective, EU-wide solution
Copying ☯ Listening
@gleonhard
… the incarnation of this trend: mobile!
Valu
e Ax
is
0
25
50
75
100
B4 Internet 1st digital wave Now Tomorrow? youtube
Potential ‘Digital Audience’ Revenue per 'Unit'
The inevitable result of digitization: lower per-unit revenues - Offensive Innovation is crucial -
CD & Vinyl
iTunes
Spotify Pandora Youtube*@gleonhard
Music is not unique in this: massive consumer empowerment’s inevitable consequence is price reduction
@gleonhard
New Scarcities:
Attention Brand
Relevance Context
Timeliness Embodiment…
Abundance of ways to ‘get music’
As distribution becomes abundant, new things become scarce
Photo by Homies In Heaven - http://flic.kr/p/d6Ff2C
The Music Industry Curse: Ego
Industrial & Mechanical ☯ Digital & Exponential Controlling Distribution ☯ Monetizing Attention
Largely monopolistic EGOsystems ☯ Collective ECOsystems
“The greatest danger in times of turbulence is not the turbulence, itself, but to act with yesterday’s logic”*Peter Drucker
http://bostinno.streetwise.co/2012/08/27/pirating-music-kill-a-horse-instead-7-crimes-not-as-bad-as-illegally-downloading-music/
Many new value generatives i.e. a ‘Royal Family’
http://www.zimbio.com/pictures/APDwKZ3i-RJ/Nobel+Prize+Award+Ceremony+2008/8XVWQBpueY7/King+Carl+Gustaf+XVI
Digital Money is a certain future: not if but when, where…WHONo longer about distribution but about attention
In large, hardware-dominated markets (US, UK, Germany
etc), ‘fake ownership’ of music used to work - but fast
decline is certain!
There is no long-term mass market for digital single downloads - but mobile music and download-HD-to-keep as a premium product has great potential !
Fake Scarcity is misleading both the artists and the consumers
Managed dissatisfaction is not a sustainable business model
Image via Popsci.com
$ $
*Reed Hastings, Netflix
http://evolver.fm/2013/07/23/paid-music-downloads-are-declining-but-why/
“Managed Dissatisfaction”
43 Million subscribers in 23 countries: be irresistible!
Distribution as a key revenue driver or as competitive advantage is a ‘burning platform’
Image of BP platform via US Coast Guard
Distribution as a key revenue driver or as competitive advantage is a ‘burning platform’
Image of BP platform via US Coast Guard
Brand & Audience
I am happy to pay cash (or data i.e. attention) for highly personalized, timely, social, meaningful, relevant, high-resolution content - but it must be on 100% irresistible terms: simple, easy, fair
The message is clear: consumers want cheap, bundled or ‘feels like free’ access first, and will only then consider going further
2010
http://musicbusinessresearch.wordpress.com/2013/10/18/is-streaming-the-next-big-thing-what-consumers-want/
FREE BEATS EVERYTHING
CONTROLLING DISTRIBUTION IS
ESSENTIAL
VALUE-TRUST-RELEVANCE
CONTEXT-SERVICE
EARNING AND KEEPING
ATTENTION IS ESSENTIAL
Sell copies
License Access
The ‘forced evolution’ of musicSell
Premiums
Yes, we already have a model for this
but the legal structure of music commerce must be transformed urgently
A €10 Billion recorded music market in Europe?1€ per Internet user in Europe / month for basic streaming & offline service
Approx. 600 Million Internet users in Europe x 12 = 7.2 Billion per year This would be 40% of current global recorded music earnings in 2012 The 1 € could easily be paid for by telcos / ISPs / portals (advertising)
Up-selling to 10+ premiums could yield another 30-50% revenues Add another 400 Million mobile phone users…
Music is indispensable to the next generation media powerhouses
…and these guys already see music as disembodied, mobile, cloud-based ‘added value’ …+++
Can Europe create a new digital
music Ecosystem?
Music industry reset: think ‘Biosphere’ not ‘Myosphere’
COLLABORATE - NOW - OR GET
SQUASHED BY FAST INNOVATORS
We are at a
pivotal point
The CD (physical media) is quickly disappearing in the rearview mirror: (em)brace
‘Managed dissatisfaction’ (such as iTunes) won’t make the pie bigger
Beyond a doubt, streaming and ‘access’ is the new ownership: new laws needed!
‘Access’ may result in a 90% reduced ‘unit price’ but has x1000 audience
We need digital music licenses that enable Billions of users to contribute $€£
Many new premiums can be offered on-top of ‘feels-like-free access’
The new (old:) ‘embodiment’ of music is the artist and the brand, themselves
Social media, video, mobile (SoViMo) are huge opportunities: get engaged!
In the EU, we need offensive innovation, real leadership and hyper-collaboration
Thanks for your time and attention... Now, let’s talk!