“The music industry will look very different in five years. Even download revenue won’t be the most important revenue source.” – Edgar Bronfman, Jr. CEO of Warner Music at the Web 2.0 Summit in San Francisco – November 6, 2008
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Not CD sales, Not online music sales, how will Musicians make any money? There are actually plenty of ways like advertising, concert tickets, merchandise, and branding influence. It’s just that people have a really hard getting past the equation Song=$1 so we can’t begin to imagine other ways of monetizing music.
Since my first rough attempt to imagine a social network music platform (see previous post), I’ve been making some contacts and starting to sow the seeds for a web startup. I hope to post some progress soon. But in the meantime – here is some news on what’s going down.
Even Warner Music Group CEO Edgar Bronfman
has acknowledged that CD sales alone are an outdated monetization model: As techcrunch puts it here – even big business “sees the writing on the wall – music downloads will eventually be free, and will serve as little more than marketing collateral to other revenue streams.”
While it is good that big business is finally coming around, this particular announcement from Bronfman is somewhat ominous. His announcement that Warner will mandate “360″ music deals, details how producers will now take a cut from everything that every artist sells including concert tickets and merchandise, and that they even reserve the right to give away content for free as promotional material.
This is why it is so important to develop an online platform for musicians (both grass roots and established) that gives them the power to not just sell their own music online (amie street, myspace, cd baby etc) but to promote their own music over social networks and supply incentives to crowdsourced microlabels who can easily find the fingers of a longtail fanbase where big production companies don’t even try to compete on a local scale. (For those of you haven’t heard, an artist only takes home a dollar or two from the 16 bucks you pay for a CD.) Record labels aren’t necessarily evil – they supply a lot of resources for a band. But the internet has brought in a new era that replaces these services for often no cost. We’re dragging our feet about taking advantage of new possibilities because we’re stuck in old ways of thinking. More on this to come – but in the meantime, this website is the best thing I’ve seen out there yet – check it out.
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