Despite the fact that the demand for great music never wanes, record
labels have it rough these days. The cause: one part misfortune, one part
To survive and thrive in the digital age, record labels need to think beyond their traditional business models.
All too eager to get cut and paste and a few other new features on my iPhone, I downloaded the latest 3.0 upgrade from iTunes not long after it was released.
However, after something like an hour of waiting, and just as the download was about to be completed, I get an error message on iTunes, and my iPhone screen looked like this:
According to new figures released by the International Federation of the Phonographic Industry, total global music sales dropped by more than 8% in 2008. In the US, total sales were down nearly 19%. The drop comes despite double-digit gains in digital music sales, which are still too small to put a dent in the decline of physical music sales.
You can be sure that digital piracy will receive some of the blame for 2008's slide. And to be fair, record labels have every right to be upset about the infringement of their intellectual property rights.
You can't fault them for trying, but a federal jury handed Eminem's former production company defeat in its lawsuit against Universal Music Group (UMG).
The company's lawsuit asked the question: should digital sales of Eminem's music be treated like physical sales or were they part of a licensing agreement?
Less than 6 months after launching, online music streaming upstart Spotify has reached an important milestone: 1m users. Approximately 250,000 of those users are located in the UK.
And Spotify is making progress on the business side too: it has signed up some big ad agencies who are trying out its new ad targeting platform.
Podcasting? That's so 2005, you might say.
With online video, social networking and microblogging remaining social media's most-talked-about technologies, it's easy to forget about podcasting.
Facing the worst financial situation in its history and being challenged to produce more revenue from its increasingly important digital ventures, The New York Times is revisiting a tried and true business model: charging people for content.
Despite the fact that NYT abandoned its TimesSelect subscription service in September 2007, New York Times Editor Bill Keller told the audience at a Q&A panel that "The lesson of that experiment, however, was not that readers won’t pay for content...Really good information, often extracted from reluctant sources, truth-tested, organized and explained — that stuff wants to be paid for."
Swedish startup Spotify launched its online music streaming service in public beta a few months ago, looking to compete with established music sites like Last.fm.
Offering either subscription or ad supported version of its service, Spotify offers the artist and related tracks radio that is a feature of Last.fm, but has also provided a good range of tracks that can be listened to on-demand.
Apple has reached a deal with the three
largest music labels - Sony BMG, Universal and Warner Music - to offer
their music DRM-free on iTunes, according to reports.
As part of the deal, Apple will give the labels something that they
have wanted for some time - flexibility on pricing.