The main theme around this year’s digital music discussion included exploring ways artists could make alternative sources of revenue beyond recorded music. We had Mark Kates, J Sider, Prof Felix Oberholzer-Gee and Jim Lucchese come and speak!!
Some notes, taken by Jingping Zhang (formerly at Sony), include:
– Spotify/Pandora: network effect (instead of scale)
– 360 deals were created because labels were losing their sources of revenues
– old model: 15% were successful. control the retail; now: direct to fans
– http://www.rollingstone.com/music/news/jay-z-kanye-rihanna-throw-support-behind-streaming-service-tidal-20150330 Jay Z’s Tidal has been around for a while. Echonest. Music-service $45M acquired by Jay Z; 12-15 stars own a piece of Tidal
– content is windowed
– streaming platforms: how do you drive value out of the customer –> focus and get them what they want
– e.g. gaming business 2007 (online gaming business. massive change) —>changed game in real time based on how much you play—>unlock the customer information for the first time, in music business as well
Tidal: has the potential as they grow. will lean on the fact that they have all the musicians that own the platform
Bandpage—>take the product. work with the streaming partners. 5x higher click-through-rate on streaming than artist’s own website, plus 10x more traffic.
– D2C: TLC’s recent promotion on kickstar campaign
– customers pay for special things: e.g. $6000 a bag of air from Kanye West concert (this is real); a photo with your favorite artist
– they want something special – hence why vinyl increasing -> merchandise.
– exclusivity has high value to consumer
– artist must deliver the experience in an ‘over the top’ way
– festival apps-> one of the most popular categories. majority not downloaded at the festivals, but used by consumers to find new music
– most valuable asset to the industry: customer segmentation. use massive data to create wonderful experience, but it’s all about customer segmentation
– Demand is VERY social—> there’s no economy of demand —> Jay Frank book (http://en.wikipedia.org/wiki/Jay_Frank)
– there’s no data that’s creating the next big artist->music is a cultural currency. That’s why the creative industry strikes out against tech trying to predict the answers
– one benefit of digital: easier to reach a global market
– Spotify: facilitate the creative choices/processes artists make (e.g. single selection) in real time, to the extent that they are interested in getting feedback
– even the most major forces don’t know how to interpret a lot of their info
– Career advice: believe in the product->monetize the market->know the structure->come in and make a difference
Disruption and opportunities:
– VIP/ticketing: lots of disruptions
– take streaming to mainstream
– venture in music has always been hairy
– Focus on artists directly->big opportunities
– Spotify’s goal : taste profile for every listener, listening context. right music in the right context.