The dematerialization of the consumption is the main factor: With the development of internet and MP3 formats, CDs are becoming almost obsolete and consumers are more disposed to consume music through those forms. The consequences of this phenomenon is that revenue are decreasing for the all value chain (the average price of an on-line album is 9,99€ whereas CDs are sold around 20€). But the more dramatic consequence is that is now possible to have access to “free” music by illegally downloading it, which is even a more loss of revenues for the music market actors.
The economic crisis is a second factor: because of the economic crisis which has hit the world since 2008, households are rationalizing their budget and so, they spend less money for leisure and culture, which affects directly the music industry.
[...] Internet help the artist to reduce their cost of making music and sell music. Music has gone to a completely digital format, and consumers are better off. Artists are too. Admittedly, record labels still have a big hold on how to use technology to develop their business, but executives are learning how to quickly adapt to a new kind of consumer. The influence of the internet of the music industry has forced many old-timers to change their frame of thinking regarding how to use their property and clients to continue making money and stay on top of the game. [...]
[...] Most profitable in the market, download services had a sales of 3629 in 2011. But it is slowing down its growth rate as more and more people begin to use subscription services on their phones or tablets. In the future, subscription services will even extent to television or any equipment that can be connected to Internet. • “Cloud music” Some suppliers are focusing more on the “cloud music” market, which is composed by two parts: one is a personalizedentertainment music service, like Spotify, MOG and Rdio; another is the cloud storage service mainly used by Google, Amazon and Apple, like iTunes Match, Amazon Cloud Player and Google Music. [...]
[...] The appearance of Napster has rescued the whole business. The model is mainly a service of peer-to-peer file sharing. This user-friendly concept was accepted very fast by most people and got a huge success during the year 2000. But the success also aroused other problems. The easy way of sharing brought legal issues for the company, which is infringement. Thus, the original website was shut down by court order. Luckily enough, “Napster” survived as a brand through liquidation and purchasing by other companies through bankruptcy proceedings by Best-buy. [...]
[...] So it's nature for them to hate Internet. If we try to look at this issue in the perspective of those alternative/independent artists, this problem could be totally different. Those artists are not that famous, they could even be familiar to no one before. But thanks to the Internet, their works could spread like virus online and they usually care not that much about the illegal file-sharing issue because even it's illegal, it still help them to promote their works. [...]
[...] Old-fashioned products and services are abandoned by users gradually, while new ones haven't been developed maturely. Music industry is searching for new ways out with strong motivations and creative innovations as “cloud music” will come to reality sooner or later. Thus, e-commerce will surely have impact on music industry in a positive way. Indicative bibliography by Oboulo.com http://www.mandmglobal.com/community/blog/11-05-09/Collaboration-and- creativity-will-save-the-music-industry.aspx http://www.angelinvestmentnetwork.co.uk/business-proposal/saving-the- music-industry;-global-virtual-media-eco-system;-pooling-skills-and- resources-to-create-2013-03-04 Source : XERFI Source : Xerfi Source : Xerfi source: www.pewinternet.com 2. A market in mutation: Sales of recorded music by market in value 1. [...]
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