Indie Music Industry.
The turn of this millennium brought with it a unique and difficult set of challenges; not just for the indie music industry, but for nearly all the business industries. The advent of internet and its prevalence has had a wide range of implications on how work is done. Today, a large part of academic literature in the music industry focuses specifically on the negative impacts of file sharing on the internet and resultant loss of sales in the recording sector. I am going to assess the wider impact of internet on the music industry, in this blog.
As all of us are aware, in the past 10 years, record sales have plummeted in a way that today, they are almost extinct. However, the live music sector has potentially presented alternative business models and opportunities to make it thrive. I have studied a variety of recent internet-related developments that I am going to share in this blog and my future blogs. I will cover the rise of legal digital distribution and its key economic implications on the industry, changes in consumer preference, general welfare effects, and social phenomena related to both the recording and live entertainment sectors. Statistical significance of the relationship between the internet’s rise and the value of record sales has been evaluated using time series multiple regression model. I have also examined recent trends and descriptive data as they relate to the internet’s prevalence, for the concert industry.
Artists believe that there is going to be no reason to connect with a label in a few years, because labels and distribution systems are not going to work in the same way then. Everything that we ever thought about music will undergo absolute transformation within 10 years, and there is nothing that will be able to stop it.
The rise of online peer-to-peer file-sharing services such as Limewire, Napster and Kazaa at the turn of the millennium, led to the prediction that like other entertainment sectors, the music industry was headed for an impending doom due to catastrophic losses in sales. These predictions seemed to become a reality to some degree for the first few years, when record sales fell drastically at least partially due to piracy. However, the impact of the internet has expanded well beyond illegal downloading, as technological change continues at a rate never seen before. It now includes fundamentally different ways of marketing, distributing and promoting music. Today it has become imperative for indie artists to have their own full-fledged website displaying their work, YouTube video links and links to other social media accounts and online libraries. HyperEffects is a company that makes websites and helps artists connect with their audience, display their talent and sell their products. The founder, a friend, tells me that they get requests from music artists every day to create a website for their work or to upgrade their existing website, it has become that important to have your own website today!
The popularity of concerts increased during the transition phase of recorded music, after the advent of internet. The launch of Apple iTunes in 2004 led to the rise of legal digital distribution, and has potentially offered a way for record labels to recover a portion of their displaced sales, adding a level of complexity to the market. The social media trends associated with the rising use and popularity of the internet has also been an important factor with online music communities beginning to form. As I have mentioned in my blog How to Become a Better Indie Artist?, Facebook, Instagram, LinkedIn, Twitter kind of platforms do not require any expertise and are the best place to advertise yourself. YouTube is the new radio. Perhaps, this is the reason why indie artists say they do not find the need to campaign on radio these days. Some say because their audience is not listening to radio anymore, some say radio is only for major label artists. Another reason is lack of time and resources to even consider radio campaigning in their marketing plan.
There are many other indirect effects of internet on the music industry – both good and bad. This article is a part of a larger article about the evolution of the indie music industry. I will follow up with a new article about indirect effects of internet on the music industry. If you have been following my previous articles on music copyrights and royalties, by now you should have a good understanding of the fundamentals. It might be wise to re-read those articles, or bookmark them to grab back whenever you encounter a subject that I have written about.
Please leave comments and suggestions and I will add them to my future posts.