November 17, 2011
Spotify and the new economy
We can all agree that the improvements of technology over the past 10 years have drastically changed the way we receive and process information. Entertainment is the best example of how this change has taken place. We are an “On-Demand” culture. We want to be able to watch, listen, eat on our terms. Tivo, NetFlix, Microwaves, Fast Food are the answer, right?
I’m hungry now! Lets go to Taco Bell.
I want to watch Dexter but I have to work. Tivo it.
On Demand LIFE.
Music is no different! 12 years ago Napster changed the way we thought about how we should collect and consume music. The iTunes store removed the negative stigma surrounding the MP3 and made it legitimate. Rhapsody, Real Networks, Pandora, Spotify and other similar services are now ushering us out of purchasing and onto streaming.
OR are they really?
Is Spotify dictating how we should consume media or are they simply capitalizing on what the world is already doing? Do we now live in a new age? Not the Information Age when information was becoming freely available for us to access but an age when we DEMAND that information?
Consider Coca-Cola…
They’ve been making their brand of cola flavored soda since 1886 and over the course of a century they utilized glass bottles as their preferred means of soda transportation…or whatever. Coke built bottling plants all over the world to put the fizzy beverage in bottles and case it up for shipping. They also washed and recycled the bottles for repeat usage. In the ’70s (edited) that all changed.
The industry demanded cheaper, disposable options…plastic. After over 100 years in business, Coke abandoned the glass bottle and adopted the plastic bottle. The change wasn’t catastrophic because Coca Cola hadn’t lost their identity in the bottle. They realized they were in the business of making the stuff that went IN the bottle.
I think of music in the same way only the industry’s identity is completely lost in the “bottle.” Without the CD (or in some cases the mp3), there is no music industry. The reality is that musicians arent in the business of making CDs or MP3s. They are in the business of making music and all they want is for YOU, the fans, to get their music and for them to make money doing what they love.
Case in point: A few days ago, STHoldings announced that they would be removing their catalogue of releases from Spotify because they felt services like Spotify were negatively affecting the sale of downloads and physical product. They based their decision off of a report that was released recently. In my opinion, the report actually further supports why services like Spotify SHOULD be embraced. Its what consumers prefer. Sell them what they want, dont force feed them something they dont.
Will Haste the Day get back together?
Not likely.
I completely agree with you man. Unfortunately the record company owners are screwing themselves because in the end, the downloading generation has found it’s answer to getting music while supporting the artist. A cheap and like you said, On Demand service which can be accessed on a cellphone, computer, tablet, etc. and doesn’t take up any space, anywhere.
No one can deny that streaming cuts down on quality but in the end it will always come down to COST> QUALITY. I am not saying I agree with it, but I AM saying that these people who found the way to enjoy their music will just go back to BitTorrent and Mediafire out of spite, not convenience this time.
Great view on a pressing issue that needs to be addressed now.
I am also in a band that makes it’s income off our the albums we sell, on our own nonetheless, and it still baffles me that people standing in the way of distribution evolution, once again.
Thanks for weighing in, Duncan! Streaming can be as high-quality as you want it, the only real hindrance is your bandwidth. The big thought here is that the music is the foundation on which you build. Music sales and streams are only one avenue for revenue.
Actually, Coca Cola switched to plastic bottles in the 70′s, not 1994. This happened soon after the advent of polyethelene plastics were produced in mass after WWII and were made available at a cheaper rate than glass bottles. The decreased weight of plastic made distribution easier. It had nothing to do with the demands of the consumer.
Bands that are successful financially over a long period of time are able to put on a good live show. It is a well known fact that bands don’t make money off records. Nothing about the demand for music has changed in with spotify or itunes. People still prefer live music, and that’s why bands with extensive live tours are most successful.
You’re right, It was the 70′s when the plastic bottle (2 liter or otherwise) was introduced. I was going off of an “evolution of the coke bottle” graphic that was probably referring to the 20oz plastic bottle gaining the majority of market share over it’s glass counterpart in America. I’ll have to edit that date so thanks for pointing that out.
I am going to disagree with your statement about successful bands. IF we are defining success with finances, the bands that are successful over a long period of time are not the ones that simply tour. In my opinion, over-touring is part of the problem of decreasing concert attendance. The bands that have longevity focus on their brand more-so than just one aspect of it, ie. touring. There are many ways to make money: licensing (commercials, soundtracks, video games), songwriting (For other performers), album sales, merchandising, partnerships/sponsorships, live performance.
Playing more shows to make more money is a “technician’s” approach to the business of music. This is Gerber’s point in “The E-Myth Revisited.” Read chapter one in that book, i think it’s free online.
Mark, good analogy. based on what i know about the situation, and the history of recorded sound, the American consumer has had to replace their entire collection of music at each stage of development from record to 8 track to cassette to cd, paying for the same music in most cases, just to stay current with the advances in technology. now it seems as though the current paradigm taking place is in the best interest of the consumer. instead of having to purchase a physical ‘product’ in order to access something which isn’t tangible anyway, it is no longer necessary to burn up gasoline and precious time driving anywhere so you can buy a cd with a collection of 13 songs, when you really only like 2 anyway, stand in a line to shell out your hard earned dollars so you can listen to it. that’s insane!!!!!!!!!! were gonna take it! oh no, we ain’t gonna take it!.. it would be hard to argue that the current methods of obtaining and enjoying music is much more efficient and benifical for the consumer. (althought i bet many would love to try) i’ts going from owning the music, to having access to it. with the help of companies like riaa, who are in business to help control the illegial downloading and piracy so employees of the industry and musicians still get paid. great entry, didn’t expect to blather this much. cheers!
Thanks for the comment! I definitely think that the the public majority desire cheaper everything. If a change in packaging helps that, then so be it.