The State of the Music Industry

This illustration we came across perfectly sums up the state of the music industry and provides a humorous, but factual representation of the journey the music industry and the forces that have shaped its frequent incarnations

How it was for a Long Time

The music industry was characterized by decades of the status quo in terms of how music was distributed and paid for by music fans.

The record companies, which went through a phase of consolidation, to now become the 4 major records labels of Sony, Universal, Warner, and EMI, controlled access to the music that fans wanted to hear and they controlled that access tightly via the business model in place

How it was in 1999

Then came along the era of Napster and CD’s. The explosion of Napster shook the music industry as for the first time, music could be obtained without the need to go through the record companies and having to pay. Not knowing how to deal with such an impact to their industry, the records companies went after Napster and the many other peer to peer platform that had sprung up.

From the artists, perspective, the power of the record companies to dictate record contract terms was further exacerbated, by the impact of Napster et al which meant the slim revenue that artist received were further eroded by the peer to peer and CD ripping activities of music listeners

How it is now

The introduction of the streaming business model has meant more choice for the music listener, but this has come at great cost to the artist, who now finds the value of the music has been eroded. Some of the platform such as YouTube openly allow for the playing of music without an adequate compensation mechanism in place for artists to share in the value generated via advertisements and other revenue streams.

Where is needs to go from here

There is no need doubt that there music industry needs to go in a different direction. It needs to properly compensate the artists to allow them to sustain a music career and continue to feel motivated to create the music for fans.

A more direct relationship with fans and artists is needed. With the rise of independent musicians who are able to reach fans through the power of social media, the marketing clout that was held by the record companies has been reduced, allowing musicians to flourish and drive direct relationships with the fans which benefits both parties.

With image credit to http://theoatmeal.com


Also published on Medium.