last100 - Latest Comments in Music industry: five alternative business models

Re: Music industry: five alternative business models

Sparkster — Thu, 08 Jan 2009 23:15:19 -0000

Crowdsourcing & fan funding have become major resources for digital music and are proving to be hugely successful, aswell as using listeners & fans to filter out the best new music. It saves a fortune in a&r costs, physical premises and physical distribution.

Offering users to chance to invest for something back in return is a very innnovative and appealing way of operating. Then there's so many other ideas. Just take a look at all these websites:

Grooveshark
Sellaband
Slicethepie
Formyband
Bandstocks
Song People

and of course my own website,

Bandengine

Re: Music industry: five alternative business models

ludi — Fri, 31 Oct 2008 10:28:30 -0000

Hi,

You should check out this out: http://peoplesmusicstore.com

It's completely new business model because on this site, it is people who choose what to stock, promote, and sell DRM-free mp3s from their own personalised store.

Its really innovative because we can sell music we love directly from our site or social network profile, and each time someone buys something from our widget store, we get a cut - "10% in the form of points which can be redeemed by purchasing music on the site"

The guy who has started people's music store is also the one who founded bleep in january 2004. Bleep was the first online music service to offer high quality DRM free files at a crucial time - there were no alternatives to peer-to-peer networks.

cheers
ludi
http://peoplesmusicstore.co...

Re: Music industry: five alternative business models

Rich Dale — Sat, 18 Oct 2008 04:34:45 -0000

My band, Escape Act is currently releasing its first album. We decided to go 'free' because it was the best way to reach as many new fans as possible. We hit upon the idea of releasing each track through a different blog, so we're reaching 10 different audiences with each song. With the first three songs out there and 7 to go, we already doubled the size of our mailing list which will stand us in good stead for gigs and future releases.

We're using an excellent service called bandcamp (www.bandcamp.mu) that lets us offer music streaming and downloads to fans. The service also offers fans the option to 'pay what they want' for a higher quality download. For us, the killer function is the data: we can see how many tracks are being downloaded and streamed, so we've a real sense of the success of our campaign.

I think we'll see a lot more services like bandcamp springing up, not copycats, but other complementary 'components' in a band's toolkit that can enable them to have a successful independent music career.

Re: Music industry: five alternative business models

JaWar — Sat, 12 Jul 2008 17:35:02 -0000

Thank you for the music business resources.

Re: Music industry: five alternative business models

Nick Rambo — Sat, 16 Feb 2008 23:12:37 -0000

Excellent article...I've always wondered when the monopoly that the music labels owned would come crumbling down. I can't wait to see how they start to monetize music videos so I can add the PPP stream to my site at http://www.rocknview.com. It really is an exciting time to be in the online music industry!!!

Re: Music industry: five alternative business models

Martin — Sun, 04 Nov 2007 14:47:20 -0000

Backing up the post fro Gary ,http://www.sellaband.com/ is an already working model

Re: Music industry: five alternative business models

David Fishman — Mon, 22 Oct 2007 18:21:50 -0000

Great article. I just published something similar on my company's blog, www.nextgreatthing.com.
Check it out here: http://www.nextgreatthing.c...

Re: Music industry: five alternative business models

Jeff Coleman — Thu, 18 Oct 2007 20:02:11 -0000

The basic flaw in all of these schemes (except free) is the fact that income for the artist depends on unit sales. We believe that this is normal and natural, when in fact it's a phenomenon that's only about a hundred years old. Artists managed to survive before music became an "object" which could be sold like cheese.

But music isn't consumed like cheese (even though a lot of music is cheesy). No, it pretty much lasts forever now. It's given away for free (via advertising) on the radio, and in shops, and between friends. How many times might one recording be "consumed"? Once it's made, music can go on and on without restriction.

So the industry created these artificial restrictions, and they try to enforce them, but this will never work until the day they manage to have decoder chips implanted in our heads. And still we listeners believe that music must be paid for one unit at a time. It's unnatural!

So how do I think music should be paid for? Well, if you hear that music for free and it convinces you that you want to hear more from an artist, why not pay the artist just for doing what they do directly? It's easy for a few thousand people to support one person just by sending them some money every year. It's almost like a subscription to the artist.

Imagine the "exclusives" such an arrangement could bring- you and a few thousand other sponsors would have the inside scoop on new music, who the artist is listening to, what they had for breakfast...

The music is free, it's the advertising for the person making the music. Step up to the plate, put your money where your heart is, and pay them for being the wonderful, creative people they are. Hell, listen to my music- and join my sponsors. It's easy, it's fun!

somewhereoutwest.com

Re: Music industry: five alternative business models

John — Tue, 16 Oct 2007 08:34:18 -0000

The IFPI can't even control it's own domain name (see http://www.ifpi.com to see what I'm talking about!), let alone steer a sensible course for the majors, so I think we should dust off our black funeral wear for the record industry. Today's consumers want music at a fair price, not at $.99/track. That kind of pricing went out the door with the retail middlemen and CD production costs. Charge a fair price like the Russians, and the buyers will come. Meanwhile, watch out for private p2p which is 100% legal, and lets users share entire albums with friends: http://www.gigatribe.com is an example.

Re: Music industry: five alternative business models

Maurreen — Mon, 15 Oct 2007 19:38:23 -0000

The tax idea is the worst. People who download no music should not have to subsidize other people's entertainment.

Re: Music industry: five alternative business models

Vladislav Chernyshov — Sat, 13 Oct 2007 13:51:12 -0000

If must confess that it's more likely that music will be free and will serve to promote one's concerts and other revenue sources. I'd like to.

Re: Music industry: five alternative business models

Tommy — Fri, 12 Oct 2007 21:45:25 -0000

I used to buy a couple of vinyl albums, then cassettes and then CD's every pay day, did it for years. I can't remember the last time I bought a new CD, it has been several years. I buy some music on iTunes, and recently tried Amazon. I will not pay a subscription (wasted money a few years ago on Real Player), and definitely will not ever pay for a streaming service because 'wideband' in the US is a joke...there are just way too many places where there is no or very poor connectivity. Since the record companies started suing music lovers, I decided to stop buying their stuff on principle, but finally broke down and started buying from iTunes. As far as I'm concerned, the record companies can all go out of business. Twenty dollars for a CD with pennies of it going to the artist, so that they can afford to market Britney or whoever the latest "mega star" is, well that's just not something I choose to support with my money.

So, let me purchase the songs I want. I'd prefer no DRM, even though I don't share files. I'd ideally prefer to purchase the music directly from the artist, although this isn't very practical, especially when the artist is dead. There has to be some distributor, but the historical model is obsolete.

Re: Music industry: five alternative business models

Fritz Kundler — Fri, 12 Oct 2007 14:15:23 -0000

Good article. I really have doubts that the record companies are going to 'see the light' and start charging more reasonable prices and I think this is at the heart of the pirating problem; fans have known that they are mainly paying for a bunch of suits that sit around a table ie., the record execs. I think Radiohead is coming closest to the solution. I believe fans will still want to support their favorite artists and keep them in business.

Re: Music industry: five alternative business models

Steve O'Hear (editor) — Fri, 12 Oct 2007 12:08:47 -0000

@George

We Mac users live in a Windows world ;)

No, seriously, sorry about that. It's another Windows-only DRM affair. Do you see a pattern here?

Re: Music industry: five alternative business models

Cal — Fri, 12 Oct 2007 07:05:20 -0000

Side note: while it's true what you say about the three main costs of the biz are falling dramatically (production, distribution, and marketing), it's least true of the 'marketing' aspect. There seems to be this prevailing idea that all one needs to do is download some recording software, post the songs for free, and then let Myspace fans take you right to the top. The first two steps, the production and distribution, are indeed much easier in the digital age, but believe me, without a real marketing push behind something, it stands about zero chance of getting anywhere.

Re: Music industry: five alternative business models

Kurt — Fri, 12 Oct 2007 06:37:41 -0000

check out www.we7.com

free music, free to download, drm free - artists get paid through ads!

Re: Music industry: five alternative business models

Charlotte — Fri, 12 Oct 2007 04:28:04 -0000

Hey there,

Thanks a lot for mentioning us to the web, that's great.
Hope you like our site and more and more will get to know it.
Musically,

Charlotte

Re: Music industry: five alternative business models

Mike — Fri, 12 Oct 2007 00:03:58 -0000

Record labels already get tax money based on blank CDs and have for quite some time.

Re: Music industry: five alternative business models

Gary — Fri, 12 Oct 2007 00:00:45 -0000

You missed www.sellaband.com in your (otherwise excellent) article. Here's a new music model which gets the artists and fans together to make the music they want, AND gives away 3 free (260kbps) mp3's off the finished album. Other tracks are available for download at 50c each, or buy the cd if you want. Due to publishing laws, the artist gets paid about 8c every time the free track is downloaded... Sellaband have to pay that. I don't see any other free mp3 downloads actually paying the artist for every download. Nothings perfect, but Sellaband is the closest I`ve seen so far to a fair system for artists, label, and fans, as all profits are split equally between them.

Radiohead and other established artists can afford to give away their music for free. There is a huge fanbase who will buy the real thing. New artists can't afford to... they need to pay the bills (and eat). Without covering their recording costs they can't continue to make music..... look out for them working at your nearest McDonalds while you listen to their music on your car mp3 player.

Subscription.... dunno. How do you fairly distribute the money to the artists? Or is it like communism where they all should get an equal share, no matter who is the best worker or most popular?

Re: Music industry: five alternative business models

tim.towner — Thu, 11 Oct 2007 23:23:36 -0000

I'm a big believer in the subscription model. In Germany, they use a subscription service for their TV. Everyone in the country gets cable with no commercials. They around $200 a year that's included in their utility bill.

I think the future of music is along those lines. We could use different levels of subscription and the music would come right to your home, to use anyway you want.

The labels would make more money than they are now.

Radio went to subscription with satellite radio and everyone thought that would never catch on. It did.

Re: Music industry: five alternative business models

Kal — Thu, 11 Oct 2007 20:04:40 -0000

what about the music website that Angels and Airwaves have specifically designed to fix the problems this article is all about! are they about to save the whole industry? Tom DeLonge says that its about getting the music out for free but the artists still making more money than before. a win/win it seems to me! whether that actually happens remains to be seen! but lets at least see!

Re: Music industry: five alternative business models

Bryan — Thu, 11 Oct 2007 17:30:10 -0000

Yeah, I realize there's a million and one music discovery sites out there. But I think what distinguishes imeem is their trackable, on-demand music playback. When I'm listening to say a UGK (Sony-BMG artist) album on imeem, for free, I'm actually supporting the artist, because they get that proportioned cut of the ad rev that imeem served me. I spoke with Ian Rogers last week, head of Yahoo Music, @Digital Music Forum, and even he sees ad-rev supported free streaming as the future that Yahoo very probably look into.

As for thethe Spiral Frog model, to me, seems unsustainable, becuz they're monetizing off of a single transaction. By streaming, you're able to monetize each and every time a song is played. There's great potential in that, I feel.

Anyhow, I forgot to say, great entry! And I didn't even know about Jamendo or Magnatune, so thanks for that heads up!

Re: Music industry: five alternative business models

Steve O'Hear (editor) — Thu, 11 Oct 2007 17:00:24 -0000

@Bryan

There are lots of services that didn't get a mention, instead I tried to get the main alt. models across. Imeem and other music-based social sites, are certainly pushing another aspect to the ad-revenue side, along with doing a great job of music discovery.

What's clear is that the three main costs of the music biz are falling dramatically: production, distribution, and marketing. The social networks are helping with the last two.

Re: Music industry: five alternative business models

Steve O'Hear (editor) — Thu, 11 Oct 2007 16:55:14 -0000

@Daniel Hughes

eMusic isn't a subscription service in the strictest sense, since you don't have access to all of eMusic's catalog, just a certain number of tracks per month. It's more akin to a pre-paid model, like a pay-as-you-go mobile contract, whereby you pay for credit up front. Although, yes, you do get to keep the music you've downloaded, even if you stop being a "subscriber"

Rhapsody, on the other hand, gives you access to the whole lot, so long as you stay a subscriber.

Re: Music industry: five alternative business models

Bryan — Thu, 11 Oct 2007 16:54:39 -0000

I have to disagree with Moxley. Tomorrow, "owning" your MP3 will be forlorn sentiments, much like physical album art and liner notes is today. "Owning" your Mp3 is a transitional urge, and the underlying factor here is convenience. If ad-rev or subscription services are so convenient and so reliable and well contextualized and comprehensive, then young people will care less about whether the mp3 is on their own harddrive or the servers. Remember, it's only a matter of time before WiMax rolls out, ensuring more and more of our own files are hosted on servers rather than hard drives.

It's the behavior of the young people will drive mass consumer behavior. To young people born into WiMaxed internet ubiquity, "owning" an mp3 file is a blurry concept.

I personally think we're headed towards a ad-rev share free model, with subscription services filling the niche need for superior services and/or no ads.

Steve, I'm surprised you don't mention Imeem. They're really pushing the ad-rev share / streaming concept.