The changing musical landscape

Two entries popped up in my RSS reader today that made me think about the ever-changing musi­cal landscape:

• On the shifted librar­ian, Jenny talks about chang­ing behav­iors when it comes to music. A 9-year-old think­ing of music as some­thing you burn, not a piece of plas­tic, rep­re­sents one of the biggest chal­lenges to date to the music indus­try. While peer-to-peer net­works rep­re­sented the begin­ning of a bat­tle, that shift in behav­ior among kids rep­re­sents a poten­tially dis­turb­ing trend: if this behav­ior doesn’t change, 5–6 years from now (when those kids are teenager) the music indus­try will see steep declines in the sales of music CDs. In other words, the medium no longer mat­ters as an entity. Recur­ring rev­enues based on changes in for­mat (as was the case with the move from LPs to tapes, and then from tapes to CDs) will no longer exist.
• In a some­what related story, Mar­tin Tobias talks about bands sell­ing con­cert videos through iTunes. This rep­re­sents threat num­ber two to the music indus­try in that no record label was involved in this trans­ac­tion. It could be because they didn’t want to be but that’s a source of rev­enue that is no longer avail­able to a label. This lack of fore­sight could even­tu­ally lead to artists or bands deal­ing directly with the stores instead of using the labels as a go-between. As I pre­dicted ear­lier, Apple is now start­ing to sell other media types than music (I expect movies will be next). I had pre­dicted the rise of online music stores as a poten­tial way for music labels to adapt to the new world of dig­i­tal media but had not antic­i­pated the pos­si­bil­ity of “some­one else” run­ning the rela­tion­ship between artists and con­sumers. This could have dev­as­tat­ing effects on com­pa­nies that do not adapt quickly enough

Between the change in behav­ior pat­terns among con­sumers and the threat rep­re­sented by online music stores cut­ting their own deals with bands, music labels could find them­selves squeezed out of exis­tence, or at least out of growth poten­tial (since they still do own copy­rights to large col­lec­tions they can still sell) within the next 5–10 years.