Music is increasingly being downloaded or streamed to PCs, MP3 players or mobile phones, rather than purchased in a physical format. In an era where everything is consumed on a casual and temporary basis, this may spell the end for CDs and is also the hub of a global debate on piracy. So what do consumers really prefer? And more importantly, are they obtaining music legally?
In an era where everything is consumed on a casual and temporary basis, this may spell the end for CDs and is also the hub of a global debate on piracy.
So what do consumers really prefer? And more importantly, are they obtaining music legally?
- Streaming music the new radio;
- Music pirates are not all bad;
- Music is the tune of life;
- Demise of the humble neighbourhood record shops.
- The main barrier to the growth of digital downloading will be music piracy, but a solution to this may lie in free, legal music streaming sites, such as Spotify and We7. This type of site allows users to stream and listen to music for free on any device, without actually downloading and keeping it. If they like the music enough they may be motivated to buy the physical album or download legally;
- If you are a musician, you might start to wonder how you should cope with changes in the music industry. Nobody knows you exist, so seek out publicity. Until a dedicated service emerges for sharing music, resembling Twitter or Delicious, artists and labels should use blogs and widgets to attract as many people as possible. Give away your music and sell merchandise around it. Build a brand around your music.
It takes a lot to be a famous musician today. Gone are the days when one could rely on talent to achieve success. Mainstream music consumers require a visual dimension to their favourite musicians. Artists in the past three decades have had to produce music videos and increasingly extravagant concerts. With each New Year, and new artist, the bar gets raised a little more.
The introduction of YouTube has allowed established and aspiring artists to post their videos for the world to see. Consumers can look at what they want when they want, offering musician’s new promotional opportunities. Artists are producing expensive music videos for their fans and uploading them to YouTube. The music itself is more accessible now thanks to services like the iTunes store. Downloading makes it easier than ever to listen to music, and iTunes allows people to hear music they may not have otherwise heard thanks to its ‘Genius’ function which matches songs to similar music in a quest to expand listening repertoires.
However, music piracy is a huge part of the internet and most countries are looking to crack down on it. A plethora of websites now allow consumers to stream music without actually downloading and keeping it. Streaming sites provide a way for consumers to sample music whenever they want to before being given the option to purchase legal downloads or physical albums. Many consumers are willing to put up with occasional advertisements if it means they are no longer breaking the law and are also obtaining free music.
This is especially important in times of economic hardship, given the high cost of CDs. The concept of streaming ties in with the major consumer trend towards “transumerism”, whereby everything is consumed on a casual and temporary basis. The idea of physically owning something may no longer be the ultimate goal for consumers.
A survey of 2310 British adults conducted in November by moneysupermarket.com, a price comparison website, suggests that Spotify, a free music streaming service in the UK and several countries in Europe, reduces people’s reliance on the illegal downloading of music. Spotify allows a huge catalogue of music to be streamed with just the occasional advert getting in the way.
There is also a premium service which for a monthly fee removes the ads and allows music to be streamed on the go via an iPhone app. Daniel Ek, the founder and CEO of Spotify, said: “The new apps for Apple and Google phones mean our users can get the best of both the online and offline worlds, making it even easier for them to listen to all the world’s music, anywhere on the planet.” Mr. Ek believes the service will reinvent the way people enjoy portable music and added that “it can only be a good thing”.
Streaming music the new radio
It used to be a rite of passage for teens to illegally download music. The forums for doing so were everywhere, whether it was Napster in the old days, Limewire, Kazaa, or simply sharing a friend’s CD or iTunes collection.
But research, conducted by music research companies Music Ally and The Leading Question last summer, found that illegal music sharing is declining and that teens are now increasingly streaming music online instead. The younger generation just wants to click – not on the download button, but on the play button. Of the 1,000 14 to 18 year olds polled, only 26% admitted to illegally sharing music files, down from 42% in December 2007. Instead, 65% of respondents said they stream music online at least once a month. Gerd Leonhard, media futurist and writer, pointed out: “Kids now only listen to music, they don’t download it. Access has become an important factor. People want to listen to music on their mobile.
Developments like WiFi, 4G iPhone’s, fancy Nokias, have all turned streaming music into the new radio”. Leonhard explained that this new trend requires new business models, as even fewer people now will want to pay for music. “The new business model is selling stuff around music; tickets, merchandising, posters, books, things like that. Consumers skip television ads, but they will listen to a sponsor message when they get free music in return.”
Music pirates are not all bad
A survey conducted in Norway in mid-2009 found that music consumers who regularly download illegally pirated music tracks are also the largest purchasers of legitimate digital music files, by a factor of 10 over non-pirates.
In conducting the survey, the independent BI Norwegian School of Management looked at the music purchasing habits of 1900 respondents, each over 15 years of age. Consumer Ethan Smith, in response to the results of the survey, wrote: “I fall into the category of pirate/consumer. However, I spend more money on music now than ever before, despite having pirated a sizable portion of my library. Music fans today don’t learn about new music through old media. Radio, television, corporate sponsorship, and for-sale “singles” just don’t sell music like they used to. Instead, we use blogs, live performances, digitally enhanced “word of mouth,” and, yes, pirating.”
Music is the tune of life
Over the last couple of years, more and more research in Asia is beginning to show that there is a slow but significant shift away from the traditional emphasis of the group and a move towards more individualistic lifestyles. Malaysia is one such country where the youth are using the power of technology to freely express themselves. Indie musicians are one such group that are finding it less of a struggle in getting themselves known by financing their own marketing, shows, CDs and more.
They are using MySpace, Facebook, Blogspot and Twitter to advertise themselves. Over two-thirds (68%) of Asian youth say that music plays a very important part in their lives, according to a Branded and Synovate survey from June 2009. This survey included 8,841 respondents aged 15-24 in China, Hong Kong, India, Indonesia, Japan, Malaysia, the Philippines, Singapore, South Korea, Taiwan, Thailand and Vietnam.
The survey found that music was particularly close to the hearts and minds of the young in India (83%) and the Philippines (80%); followed by Vietnam (77%), China (69%), Thailand (67%) and Indonesia (65%). “The love affair between music and young urban Asian consumers remains,” the study proclaimed. Overall finding also showed that 25% of the respondents were listening to more music obtained digitally in the last year.
Source: Euromonitor International from trade sources/national statisticsNote: Market sizes based on retail value RSP.
Demise of the humble neighbourhood record shops
Gone are the days of hanging out at the friendly, neighbourhood shops, where consumers could spend hours browsing and sampling music and making a social activity out of it. Instead, consumers today will buy music on the net as part of the rise and rise of online shopping. This trend continues to be popular among internet users in the Asia-Pacific region.
Here, 89% of people who participated in a survey conducted by Visa eCommerce Consumer Monitor in November 2009 said they had shopped online in the past 12 months – with music being the third most popular item bought online among 49% of the 2380 respondents having downloaded music legally.
Pauline Chong, a 21-year old university student in Singapore, said: “I prefer buying music online – legally – to buying physical CDs. Online albums are usually cheaper and I can just buy the tracks I like within the album. I used to download illegally, but all the viruses and the possibility of breaking the law are just not worth the trouble.”
Over in Europe, a September 2009 online retail survey conducted by Statistik Austria, the national statistics office, found that 36% of all Austrians aged 16 to 74, about 2.6 million consumers, have been shopping online in the past year, a 4% increase. At least once a month, every polled Austrian enjoys a trawl through the internet, with legal music downloads being a boom sector, according to the Integral Austrian Internet Monitor on consumers, growing 10% in one year.
|% of total retail sales|
Source: Euromonitor International from trade sources/national statistics.
Listening to music will continue to be a major form of escapism for many consumers, but music will increasingly be downloaded or streamed to PCs, MP3 players or mobile phones, rather than purchased in a physical format. Many believe that in the future, CDs will become obsolete but for a small collector’s market, in the same way that vinyl records and cassettes have in the past.
The main barrier to the growth of digital downloading will still be music piracy, but the solution to this may lie in free, legal music streaming sites. With the hugely successful Spotify joining the ranks of legal music sites, illegal downloading seems set to become much less popular. Streaming music while on the move could spell the end for illegal downloading and could even send the CD the way of the mini-disc and cassette tape.