Future of the Music Industry

As a musician, the future of the music industry is one that is very important to me. I was a working musician in Denver, Colorado for close to a decade and I have returned to school to study recording arts. My goal is to work in a studio as a recording engineer and possibly open my own studio or production company specializing in smaller projects. This would also give me an opportunity (hopefully) to work with my former bandmates on songs that we've been working on separately and together since Ashfield disbanded in 2014. That said, will there even be a market for this when I graduate?

When Napster launched in 1999, I think it was a monumental moment in music as it was really the first sign that the future of music was digital distribution. The failure of Napster was that it allowed users to share copyrighted material with other users with no compensation for the artist. In essence, they were stealing. Obviously this led to multiple lawsuits from artists such as Metallica and Dr. Dre, but the seeds had been planted. Now the largest retailer of music is Apple (a computer company) through it's iTunes platform and many consumers get their music through streaming platforms such as Spotify who as of April, 2020 has 286 million active users.

The music industry is often broken down into 3 separate industries; the recorded music industry, the music licensing industry, and the live music industry. The move to digital really only affects one of these, the recorded music industry, which deals in recording and distributing music to consumers. Before Napster, distribution meant dubbing a recording onto a physical medium (LP, cassette, CD, etc.) and shipping it to a brick and mortar retail store where it was then sold to a music consumer. The issue here was that music companies were only interested in distributing those recordings that were going to turn a profit, so the selection of music if you were to go in to your local Best Buy or Wal-Mart was limited. While Napster was breaking copyright law, they did introduce a revolutionary system where more and more niche music was available to the consumer. You didn't need to hunt for that new Social Distortion record, you could just search on Napster and download it from someone who had already bought it.

As digital distribution became more common through online retailers such as Apple and Amazon, consumers were presented with another novel idea. They were now able to purchase music on a song by song basis rather than purchasing an entire album. While music companies were initially resistant to this, I think they've come around to the idea that if a consumer really likes the new Alkaline Trio single, they will more likely pay $1.29 to download that song rather than pay $9.99 for the entire album just to get access to the one song they really like. This also allows bands to release songs as singles ahead of full albums as promotional material. A Day to Remember has taken advantage of this by releasing 3 singles ahead of their full-length album, You're Welcome, set to release later this year.

So how do we tie this all to the future? Well, according to the IFPI Global Music Report, while physical revenue declined by 10.1% and download revenue declined by 21.2%, streaming revenue was up 34% which offsets the declines. So by this trend it is clear that streaming revenue is the future of the recorded music industry. But we still haven't talked about the other 2 industries in the music business. Obviously with the COVID-19 pandemic, the live music industry has taken a massive hit. I truly believe though that when venues are allowed to open again and bands are able to tour, the live music industry is going to explode like we have not seen. People are dying to get out and be with people and listen to live music, at least I am. Also, I think we've seen a way for more artists to get more music out to their fans with the rise in "bedroom concerts" live streamed on platforms like YouTube. I hope that trend continues even after we get to start going to live concerts again. One thing about the bedroom concerts is that the sound quality isn't always great. I think this is an opportunity to combine the live music aspect with professional live audio to create an immersive experience for fans from the comfort of their living rooms. The music licensing industry has likely taken a hit as well as movie production has been put on hold so music is not being licensed for films. But again, when films are able to resume production, I think the music licensing industry will return to normal.

So to summarize, I believe the future of the recorded music industry is streaming music. As we discussed in class, the royalties being paid to the artists from platforms such as Spotify are literally in the fractions of cents, but my hope is that the Music Modernization Act will help to make that more fair. I also hope that artists will build on the "bedroom concert" idea by incorporating more professional sounding audio to the live streams to create a more immersive experience for the consumer. And finally, my biggest hope as a musician and a recording arts student is that I get to be a part of it.