With 2015 upon us, there is widespread optimism about the music industry. Touring continues to grow, and a shift in the recorded music market away from ownership toward the subscription model has many believing that perhaps changing business models can breathe new life into a very disrupted industry over the past 15 years.
Challenges stand in the way. Secondary ticketing continues to pose huge problems in touring, despite highly increased ticket prices. And streaming’s business model is threatened by public reports of very poor artist payouts, leading major artists to pull content from the services.
At Rethink Music, we have a few predictions for 2015:
1. Streaming will gather momentum and become dominant or well on its way to dominance, depending on the market.
2. Consumers will begin to demand better sound quality through streaming. Neil Young’s Pono player and Jay-Z’s recent bid for Tidal, the hifi streaming service, are bringing attention to the fact that we don’t have to listen to poor quality compressed MP3′s anymore.
3. Sadly, major record label power will further increase. With a floodwall of independent material, distributors will be looking to the big players to give them tomorrow’s hits. And in the end, labels are the ones with marketing machines powerful enough to make or break an act.
4. Writers and artists will take a stand on digital payouts, and technology will begin to allow true total transparency to better understand how the money is flowing.
We also have a few promises and resolutions we think the music industry should make this year:
1. Artists and writers should pledge to educate themselves about how money is made in the music industry. Every single artist should understand the basics of copyright and money flows in music.
2. Streaming services, labels, publishers, and PRO’s should promise and deliver complete transparency about their payments process and what deductions are taken, and should pay royalties within a reasonable timeframe in readable formats.
3. Finally, and perhaps the most important, the industry should take a vow to work together to grow music revenues. There is just no point in fighting over a decreasing pie.
We CAN move forward and have a healthy industry. It’s just time to do things differently.