Music in the Cloud

With the music industry in serious trouble, there are some interesting developments in using the 'cloud' as a vehicle for a new business model

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Apple has led the shift with iTunes as a successful music business. Now Amazon and Google are two big players that are offering a 'music in the cloud' service. However a new player has emerged with a variation of the cloud service to challenge the three big players. Spotify as been operating in Europe and has now launched in the USA. Spotify's big claim over the others is the offer of free music.

Explore the following websites:

http://www.apple.com/icloud/

http://www.apple.com/itunes/

http://music.google.com/about/

http://www.amazon.com/MP3-Music-Download/b?ie=UTF8&node=163856011

http://www.spotify.com/int/

Watch the following video:

http://youtu.be/ZrNhKcxBbZo

http://www.youtube.com/watch?v=Gng29RIhIl8

Read the news:

http://www.theaustralian.com.au/news/nation/piracy-fears-cloud-apple-launch/story-e6frg6nf-1226071294051

http://www.theaustralian.com.au/business/world/online-jukebox-spotify-valued-at-1bn/story-e6frg90o-1226009844746

http://www.news.com.au/technology/first-amazon-now-google-takes-music-to-the-cloud/story-e6frfro0-1226053947338

http://www.marketingweek.co.uk/disciplines/digital/apple-set-to-unveil-cloud-music-service/3026936.article

Q1. What are some of the differences between the 'music in the cloud' offerings?

Q2. How can Spotify offer free music?

Q3. How do these services avoid the risk of 'piracy'?

Digital Music - Sony Business Model

Sony offers unlimited music for $12.99 a month as Aussie chief left red-faced

The Age

Asher Moses

February 18, 2011

"Sony's new service, which officially opens for business in Australia, New Zealand and the US today after launching in Europe late last year, is dubbed Music Unlimited and provides access to six million songs.The service will go head-to-head with iTunes but unlike on Apple's service, where consumers download individual tracks to their computers, Music Unlimited tracks are streamed from the web, so users can't store them. The $12.99 premium plan provides unlimited access to any music while the $4.99 basic plan works like an ad-free radio station whereby users can select the genre or era but not the individual song."

Q1. What would be the attraction of the 'Music Unlimited' plan?

Q2. What is happening to CD sales?

Q3. Why are Digital music sales declining?

Is the Music Industry Waking Up?

The music industry has a big problem with illegal downloads of digital music. CD sales are down and control of digital music via DRM does not appear to be working. However there are some signs of new business models emerging, with the Apple iTunes Store being a good example.

The latest news is that the four biggest music publishers are negotiating with major ISPs (Telstra, Optus etc) to deliver a subscription service for music downloads. The only catch is that the digital music will 'expire' if the subscription ends. Another development is to use advertising to pay for downloads that MySpace is believed to be launching.

Other developments are marketing strategies that are more diverse, using pre-release digital downloads for free, mobile phone ring tones, mobile phone promotions, on-line ads, concerts, appearances tied in with TV, radio.

For a good roundup read the article Telstra, Optus talk music downloads in MIS.

An interesting quote from the article:

"(the internet) ....gives a way to reach fans and get them involved and engaged"

Q1. What does Sony BMG mean when it sees itself transforming from a CD company to a multi revenue, multi -stream, multi-business company?
Q2. Which business model is more likely to succeed: free downloads with ads or a subscription service with unlimited downloads?
Q3. How does getting fans to be 'involved and engaged' help the bottom line?

The Kids Have IT!

Media and Communications in Australian Families 2007:
The Australian Media and Communications Authority released a major report of an in-depth study of children’s use of electronic media and the way parents mediate that use.

"The Media and Communications in Australian Families 2007 report surveyed a representative sample of 751 family households with children aged between 8 and 17 to gauge media use in the home, how young people divide their leisure time and how parents view their children’s use of media and communications technologies. The report also includes a review of academic research about the influences of media and communications activities on children."

"The report found that in relation to the families surveyed:

• Most families with children aged 8 to 17 have three or more televisions in their home and three or more mobile phones. Almost every family home has a computer (98 per cent) and DVD player (97 per cent).
• Nine-in-ten family homes with children have the internet, and 76 per cent of these homes have broadband compared to just seven per cent in 1995. More than three-quarters of family homes have a games console.
• Almost all parents with children aged 8 to 17 see the internet as beneficial for their children, mainly as providing learning or educational opportunities. Similarly, four-fifths of these parents see benefits in their child’s use of a mobile phone, particularly for safety and security.
• Families say electronic media and communications activities take up around half of young people's total discretionary time – a proportion that has not changed since 1995. Children themselves demonstrate a balanced attitude to the use of electronic media and communications. When given a preference, young people often prefer to do non-media activities and socialise with other people."

ACMA media release 148/2007

Media and Communications in Australian Families 2007

ACMA Presentation

Similar survey from USA
http://www.pewinternet.org/PPF/r/230/report_display.asp

Q1. Have we reached saturation point?
Q2. How does this affect consumer behaviour?
Q3. What are possible ethical issues?

Music 2.0??

Reading music in the digital realm

"The futures of the record industry and music education lie in the technologies, communities and value systems of the internet, writes Paul Draper | The Australian November 28, 2007

FROM MySpace to YouTube, Flickr and Last.FM, an online participatory culture is transforming value systems and creating new pathways for autonomous innovation. In this so-called Web 2.0 phenomenon, social networks continue to define the information society and redefine music career opportunities.

The idea of the record industry once conjured a picture of a Fordist production chain of artists, promoters, record company managers and sound engineers operating complex equipment in impressive recording studios.

In the 21st century, however, such workflow is increasingly devolved to independent musicians with portable digital systems, home recording studios and online networks. This includes composing, recording, filming, direct merchandising, concert tour promotions, engaging with fan bases and other communities of practice via resources such as blogs, podcasts, and digital music download stores.

Music 2.0 is the new digital musicianship and technological imagination for the 21st century."

1. Is 'cyberspace' the new toilet wall?

2. How is 'the romanticised '70s style, star-driven model of the record company' changing?

3. Why did 'Radiohead release their new album online with a donation value to be decided by their audiences'?

www29.griffith.edu.au/radioimersd

http://www.iorpheus.com/

Word of mouth and internet favoured by youth

Hi Class,

We have been talking about this subject in class, so thought id add this article published in B & T 22/5/07

Word of mouth and internet favoured by youth

New research has underlined the power of word of mouth and the internet among 16 to 24 year-olds when discovering new brands, while TV and newspaper consumption continues its downward spiral.
In a study commissioned by AdShel and carried out by research firm The Seed into the behavioural patterns of this age group, it was found young people usually only listen to the radio in the morning or while driving; they have reduced TV watching to favourite "core shows", borrow DVDs to watch at their convenience and skip ads, or download shows from the internet; and don't even think about picking up a newspaper. This is backed by figures from the Roy Morgan Single Source for July 2005 to June 2006, which show 16-24 year-olds are 35% more likely to engage in heavy "out-of-home" activity, 16% are likely to engage heavily in magazines, 4% in extensive radio and 2% in heavy internet use.Respondents also revealed that they discovered their current favourite brand through a combination of word of mouth, advertising and the internet. Technology brands such as Apple, Nokia, LG, iriver and Motorola are popular with both sexes. However, specifically among boys, brands such as Red Bull, Oroton, Rip Curl, Billabong, Nike, DKNY and Asics are the picks.The favourites among girls are brands such as Sportsgirl, Converse, Covergirl, Maybelline, Chanel, Bonds, Hugo Boss and Adidas, according to the survey.In terms of advertising, a level of intrigue or creative that is a little confronting, were deemed to be the most effective.

New Business Model for the Music Industry?

From Marketing Hipster Blog:

1. Each record company open up their entire library to be able to buy online whether that is through iTunes or their own web site.
2. Offer a higher sound quality through our online stores. If the CD is recorded in 192 kbps, double it online. The best sound quality possible is one click away through our online store.
3. Offer outtakes, videos, etc. when buying online, something they cannot get in the stores and cannot get by stealing. The reason why they cannot get it through stealing is we integrate these extras with our web site. A user will have to register and that person only will be able to get these add-ons. Very similar to how iTunes works.
4. Integrate the music with other offerings as well. For instance, buying directly from the publisher gives a buyer VIP access to the artists blog. They can chat live with the artists, get information before anyone else, etc. etc.
5. Partner up with social sites like MySpace where we can offer online concerts, live web chats, etc. Get our fans involved on their terms not ours!

http://www.marketinghipster.com/2007/03/27/what-would-you-change-riaa/

From Recording Industry Association of America
Music Theft at 23 Campuses Targeted in Second Wave of New Deterrence Program
Music and Movie Industries Applaud Release of New Study Documenting High Cost of Piracy on Los Angeles Economy

Breaking News: iTunes and EMI do a deal!