Evaluation of Current Trends in the Music Industry - Essay Example

Evaluation of Current Trends in the Music Industry July 23, Evaluating the current trends in the music industry can help those in this business to have a more substantial response to demands within the environment. Globalization and technology are the two trends that are continuing to change the ability to produce and distribute music within the industry. Live promoters and recording studios are both being affected by this by the growing opportunities for indie artists as well as the changing demands from fan bases. Creating a business environment that fits with the specific needs within the newer music industry can then provide a better response to those that are interested in music as a business. This paper will examine the different responses from the environment that are changing the industry as well as what the new expectations and demands are with newer models for music. It can be seen from this specific report that innovation, creativity and building new approaches to using technology will help to sustain those that are a part of the music environment. Table of Contents Introduction………………………………………………………………………………..4 Objectives…………………………………………………………………………………4 Live Music Promoter Current Trends……………………………………………………..5 Recording Studio Trends.....................................................................................................6 Future Expectations…………………………………………………………………….…6 Ethical and Legal Issues…………………………………………………………………...8 Music Product Lifecycle…………………………………………………………………..9 Development and Marketing of Music Promoters and Recording Studios……………...11 Music Business Environment……………………………………………………………12 Discussion………………………………………………………………………………..14 Conclusion……………………………………………………………………………….15 Introduction The current trends that are in the music industry are creating significant differences in how musicians and artists are able to promote and record their music. The use of technology as well as available resources is providing more opportunities for those that are interested in the field of music. Two of the leading trends that are providing a different level of professionalism to the music industry are from live music promoters and recording studios. The growing trends that are a part of this are providing different levels of support to musicians while altering the growth of the music industry. The purpose of this report will be to define the specific trends that are in the industry as well as how they are affecting those interested in a music career. This will consider the business methods and marketing that are a part of this as well as the lifecycles and marketing that are currently used. Through an analysis of these two main business arenas, there will be an understanding of where the music industry is going in the next ten years as well as how different music and promotions will offer to musicians. By examining these aspects of the music industry and analyzing the changes that are going to be made, there will be a better understanding of how those in the career field can begin to use talents, technology and business aspects to offer different forms of music. Objectives The ability to analyze the music industry is one that can provide a deeper understanding of where the career field will go in the future. In this report, there will be a focus on: current trends for live music promoters and recording studios potential future trends analysis of ethical and legal issues in the industry evaluation of the product lifecycle of music promoters and recording studios business development and marketing analysis for the music industry analysis of the music business environment discussion of the future opportunities for the music industry as a business opportunity The several objectives will be able to define and analyze what is needed within the music industry to change the opportunities that are available while providing a deeper level of insight into the music business as a changing and growing entity. Live Music Promoters Current Trends The perspective of music is one that is continuing to grow and change with the globalization that is currently becoming more popular. Music as an industry is no longer a local or regional expression that many use but is instead a global concept that music promoters are using. The approach to live music promotion is one that is not only based on the concept of creating a fan base within a local realm, but also is known to be more effective when using promotions at a global level. The Internet, technological aspects and tools for promotions are all being used to create stronger fan bases and to create more specific target markets with live music promotions. For instance, spaces such as “My Space” and “Facebook” can help to promote fan pages and to build a repertoire for fans. Music promoters can combine these tools of technology with an understanding of where music will be most effective at as well as what types of fans are drawn toward a specific genre. More importantly, the different Internet tools can be used to monitor trends, tickets and other promotional needs that are a part of the music industry (Throsby, 7, 2002). Recording Studio Trends A second sector of the music industry that is beginning to change is through recording studios that are available. There are two main segments of recording studios that are currently being seen within the industry. The first is from the larger corporations, such as “The Big Five,” including businesses such as Sony and Warner Brothers. The second segment for recording studios is coming from independent artists who are recording their own music or other’s music for independent release. Many have noted that the recording studios that are available at local and regional levels are creating a transformation in software within the industry. The ability to download MP3s, use new software, such as Pro Tools, for recording and the standardized sounds that are used by independent and large corporations, are providing more flexibility with recording. More importantly, the standardization and flexibility with software is now leading into digital recording, which is providing studio artists with easy to use options that automates sound and makes the release of music easier to reach. From these changes, many have been able to build private and small studios which have led to larger studios losing revenue and institutional thickness within the community. Instead, independent artists and those that are interested in more expressive rights are using their own tools to reach the same standards (Leyshon, 1309, 2009). Future Expectations The concept of music as a business as well as an entity that can be easily accessed through digital portals and the Internet is beginning to change the way in which the music industry is developing. There are many that are finding the several facets used for live music promotions and the independent recording studios are leading to more options for listening. Many are branching out with the music that is available while providing listeners with options that include more genres and musical styles. The concept of music is not only one that is based on a specific trend but is now defined as metadata of music, which consists of knowledge about music. The trend of listeners is to move toward the knowledge of music and to have more cultural and expressive experiences through independent artists and global sounds. For the music industry, this is leading promoters into the direction of looking at music as a cultural concept that can reach more portals more effectively. For recording studios, this is changing the ability to use digital sounds for easier promotions that can reach a wider audience (Pachet, 1, 2005). The future of music is one that will be considered not only through the traditional means of recording as well as live music promotions. Instead, those that are working within music are altering the focus to establishing online networks. The traditional methods have been altered with the understanding that peer to peer file trading and online downloads are more effective, with many focused on creating a metadata knowledge base of music. For the future, it is expected that this will continue to grow with established communities not only through the basic portals, but also which are divided according to genre, culture and musical tastes. The globalization that is now a part of the music industry is one that is expected to grow as many look at music not only as an expression, but also as knowledge and an understanding of culture. For recording studios and live music promoters to remain effective, there will be the need to establish even more online and technical alternatives for those that are interested in music (Vaccaro, Cohn, 46, 2004). Ethical and Legal Issues Even though technology and knowledge bases for downloads are the driving force that is leading into the future of the music industry, there are also several ethical and legal issues that will need to be considered. For music promoters, there are questions of whether websites should be established to promote the music of different artists as well as how far this can go with the distribution of music. Many believe that the way in which the promoters are establishing a repertoire for artists is one that is not legitimate and creates an alternative appearance outside the music. For mainstream and popular music the image that is used by music promoters is taken a step further. The promotions will move into appealing looks, promiscuity and images that are not representative of the artists. For both fans and the artists, this creates a question of how far is too far for music promoters. However, the promotions continue to do this specifically because there is the need to establish a stronger basis that now includes a global network (Lam, Tan, 62, 2001). Another ethical issue that continues to press those that are moving into online portals is based on the royalties and rights that are used for the music. There are several that are taking the music that is online and finding ways to pirate the music and re-sell it without the permission of the artist or those that have recorded the music. For recording studios, the ethical and legal issues are raised in terms of safety, piracy and the downloading that is used for those that are online. Recording studios and promoters no longer have an obligation to establish the artist. Instead, there is the need to mainstream and guard the music that is being produced in a different manner. As technology options grow and as the demand for more music continues to rise through online portals, are different ethical questions of how to establish and promote the music without copyright violations, piracy and downloads that don’t provide payment or royalties in return (Lam, Tan, 65, 2001). The questions that are now being raised in terms of ethical and legal issues are creating a large turn in the musical industry and the business that is done. Having the ability to raise standards that are currently a part of music distribution and performance and changing the way that music is looked at will provide a stronger basis for those that are interested in listening to music. While the demands for music have increased with global networks, technology and the ability to easily record, there are also other aspects that have hindered the growth of the music and which have created several divides with establishing an online presence for artists in the music industry. Music Product Lifecycle For all music to become established through technology and with newer business models is also the need to understand how the various considerations tap into the music product lifecycle. Most that now look into music also consider it a high technology product, specifically because of the MP3s and downloads that are available, as well as the promotions that are established online. Within the technological network, is a faster lifecycle that is established for those that are working toward specific innovation. Since technology is able to change at a rapid pace, the music industry is also required to establish more songs and levels of knowledge more quickly. The lifecycle that occurs with different music products then begins to change where the interest peaks more quickly after it begins to spread on the Internet and through technology. If it becomes an idol song for popular culture, then it can be expected that the lifecycle will be shorter and will not be as influential. Other types of lifecycles will move into longer time frames; however, these are dependent on the knowledge base that grows out of the popular products. If the impact is able to become influential through social media, innovation and the portrayal of the music and artist, then it will increase the lifecycle. This moves out of the concept of popular culture and into developed capabilities for the music brand (Mcintyre, 140, 2002). A concept that is beginning to be used with the music industry to monitor the popularity of music is based on ways to estimate how long a life cycle will be. This component begins with a pre – launch of single releases by a new and upcoming artist or through an old artist’s brand name. The pre – launch can determine what the market will be for the upcoming album as well as what the response will be. Many are using this to determine the recordings of albums through culture, geographic location and interest that are related to demographics. Peer to peer networks are moving this potential into higher ratings, not only with the pre – launch, but also with the release of the final album. These networks are able to measure and determine the ratings of the music as well as how long it will last in popular culture. The one concept that can be applied with this is based on the top 100 charts and the ratings on different sites. As these move up in peer to peer networks, more sales, recordings and demands for live performances are made. However, this particular life cycle will be filtered after an average of six months when newer releases will be expected. The market performance of new albums then has to be released with the expected changes for one artist occurring once a year. If an artist can release new songs at this rate, then continuous popularity and the movement into classic hits can be determined as a part of the life cycle. Unlike other brands, the music industry life cycle is not only important by the song and album, but also alters according to the artistic abilities and the name that is created from the first songs (Bhattacharjee, et al, 14, 2004). Development and Marketing of Music Promoters and Recording Studios For both music promoters and recording studios to become influential, the need to work with technology, artists, songs and the lifecycle are essential. Currently, there is a need to create a new architecture for business development within the music industry. The old structure that was used was based on promotions that came after a CD release, which was used to build the artist name and the specific songs that were released. For this to work effectively, the artist would have to promote the music, combined with the need for different segments of the population to respond in a specific way. As a fan base was built, the artists would have to continue with a combination of performance and recording to establish a stronger reputation. With the new business model, technology can be used with virtual communities. Music promoters no longer have the role of establishing a fan base from the different events that are created, but instead have to use the development in a virtual community while creating stronger economic value with the music that is listened to and downloaded. Peer to peer infrastructures as well as the ability to find specific virtual connections are becoming more effective than physical promotions. This business model also leads to different types of recordings and releases for musicians and artists (Lechner, Hummel, 41, 2002). The business model of using virtual communities, as opposed to physical promotions is one that opens new doors to musicians and the music industry. The main change that can easily be seen from this is the movement into globalization with segmented markets being built from cultural aspects as well as demographics that are drawn to different types of music. However, for this to work effectively, the marketing model that is used has to move outside of the traditional marketing of the music industry. Marketing not only includes the basic promotions of the CD and the recording that is completed. Since there is a movement to new technologies, such as MP3 downloads and digitalized sounds, there has to be compliance with how a fan base can download and listen to music. Innovation with the format, distribution and pricing of the music is required to reach more individuals within the marketplace. More importantly, there is the need for the music industry to begin marketing the different pieces of music with an established framework for a global market that can be reached through technology and the Internet. The structure used is one that can take advantage of peer – to – peer networking, different types of downloads and distribution in different technical formats. Each of these will assist individuals to become more loyal to an artist while establishing a stronger global network and fan base for artists (Bhatia et al, 70, 2003). Music Business Environment The music business environment that has been established within the industry and which is currently transforming through technology is one that is continuing to change. Those that are within the industry are at a space in which innovation is a main component to reaching a stronger fan base and those that are interested in music. The innovation that is required by the music industry includes the ability to promote artists in a different manner. Using technology, albums and different songs to continue with these promotions is then able to provide a stronger basis to those that are within the industry. The promotions that are now required in the environment are not only based on the main concepts of reaching to a different fan base but also require specific levels of knowledge and an infrastructure that can provide online guidance for marketing and an established fan base. To sell the music consistently, the promotions and the recordings are required to establish a stronger brand name while using different outlets for consistency. Many are turning toward commercial music to reach different segments of the market, which includes specific types of recordings and sounds. This is often combined with small changes that are built for music as an expression or art work, both which work together to change the promotional level that is used for the music (Baskerville, 20, 2006). The music industry environment not only shows these specific changes through the demands of fans and the movement into technology. The recent findings in the residual income show that there is a downfall in the amount of CD sales by fan bases while the MP3 and digital downloads continue to increase. It has also been found that live performances continue to increase, specifically with large tours by various groups. Last year, one artist group, Robbie Williams, made an average of 80 million in revenue from one tour. Brand extensions, such as t-shirts, are known to make up 30% of the revenue from the music industry. It is also known that independent labels and artists are continuing to grow in popularity, specifically with specialized concerts and the fan bases that are being built from technology. For larger corporations, this is causing the sales of downloads and CDs to move to lower numbers, with 50% decreases continuing to move into the industry. With CDs of larger corporations bringing in revenue in the past, is the need to implement new opportunities for artists. Currently, this has changed to only 14% of the profits. To compensate, marketing and advertising has moved into a combination of live promotions with finding offers for film, video and other multimedia outlets combined with the need to meet technological opportunities that continue to rise. At the same time, the digital downloads have increased to 74% since 2006, with a continuing rise in demand for downloading music from online sources (Sandall, 137, 2007). Discussion The changes that are in the music industry are leading to different ways in which the companies have to compensate for artists and recordings. The live performances as well as the recording studios are changing out of the traditional means and are moving into the newer concepts of expectations that are within the market. The main change is the movement into the technology that is available. This has led to peer – to – peer networking as well as building fan bases through online portals. The technology has also allowed the digital downloads to be the main source of income while CD sales and traditional methods of sales are beginning to falter. Even though live performances are still effective, this doesn’t work unless there is the ability to develop a fan base through cultural aspects of the fan base while linking this to the demographics and business environment. The current changes that are a part of the music industry have not only altered the traditional means of the business environment and marketing. Both live promoters and recording studios are being challenged to move into a different approach to music and the industry. Promoting and recording artists with a combination of creativity and commercialization is what will make the difference in peer – to – peer networking as well as the ability to build a stronger fan base. It is essential for those in the music industry to find niche markets, specifically with the growth into globalization. More importantly, the indie artists and the need to find specific genres are making a difference in how several are responding within the industry. For promoters and recording studios to work effectively, there is the need to tap into consumer demand while providing a sense of innovation within the industry. As this is done, it will make a difference in the cultural responses to music as well as the level of popularity of artists and the music that is available. More importantly, this will change the life cycle that is currently a part of the industry so the fan base can respond for longer frames of time to downloads that are available. Conclusion The changes that are currently a part of the music industry are making it essential for the corporations and artists to experiment with the approaches to music. The combination of globalization and technology have changed the way that most look at music into one that is based on culture, popularity and peer to peer networking. For promoters and recording studios to take advantage of this, there is the need to implement more with the new technology and to respond to the demands that are within the industry. As this is done, it will assist with the popularity of various artists and will allow the promoters and recording studios to have a stronger business environment. Adjusting to the changes and shifts within music will then offer more opportunities for those that are working within the business environment of the music industry. References Baskerville, David. 2006. Music Business Handbook and Career Guide. California: Sage Publications. Bhatia, Krishan, Richard Gay, Ross Honey. 2003. “Windows into the Future: How Lessons from Hollywood will Shape the Music Industry.” Journal of Interactive Marketing (17), (2). Bhattacharjee, Sudip, Ram Gopal, Kaveepan Lertwachara, James Marsden. 2005. “Using P2P Sharing Activity to Improve Business Decision Making: Proof of Concept for Estimating Product Life – Cycle.” Electronic Commerce Research and Applications (4), (1). Lam, P, K Tan. 2001. “The Internet is Changing the Music Industry.” Communications of the ACM. (44), (8). Lechner, Ulrike, Johannes Hummel. “Business Models and System Architectures of Virtual Communities: From a Sociological Phenomenon to Peer to Peer Architectures.” International Journal of Electronic Commerce (6), (3). Leyshon, A. 2009. “The Software Slump? Digital Music, the Democratisation of Technology, and the Decline of Recording Studio Sector within the Musical Economy.” Environment and Planning (41), (6). McIntyre, Shelby. 2002. “Perspective: Market Adaptation as a Process in the Product Life Cycle of Radical Innovations and High Technology Products.” Journal of Product Innovation Management (5), (2). Pachet, Francois. 2005. “Knowledge Management and Musical Metadata.” Encyclopaedia of Knowledge Management. Sandall, Robert. 2007. Off the Record. The Prospect (137). Thorsby, David. 2002. “The Music Industry in the New Millennium: Global and Local Perspectives.” UNESCO. Vaccaro, Valerie, Deborah Cohn. 2004. “The Evolution of Business Models and Marketing Strategies in the Music Industry.” International Journal of Media Management (6), (2). Read More