The tried and true methods of creating success in the music industry are over and are never coming back. The economics just don’t work for most acts anymore. The greatest risk in the next 5-10 years for music is that no one will want to fund the development and promotion of new musical acts the way the major labels did in the past, until we see a new financial model.
To survive, musicians and their managers need to innovate and break out of the old ways of thinking about the business. The oft quoted conventional wisdom that artists can survive on touring and merchandise income is simply not going to work for most bands. Instead, real blockbuster success in the future belongs to those ready to break the rules and create new engaging musical experiences, and unique products and services that cannot be duplicated.
Music is an inherently social phenomenon and we are already seeing the impact of social media on the way that music is marketed and consumed. We are connecting fans and artists enabling a broad spectrum of musical search (pandora), concert (songkick) and ticketing innovations and direct to fan engagement (topspin and nimbit). But most of what has been developed thus far is in support of the way it used to be, instead of the way it needs to be.
Perhaps the next musical breakthrough will come from some sort of interaction between creators and consumers fueling a unique experience that you just have to be there to enjoy. Nothing to download, just an experience with a limited audience. A creation of value that appeals to the thumb twiddling electronic generation in ways their parents never even dreamed of. A way of engaging with artists that true fans will fight to get access to.
How do we get there? Where is the strategic thinking that will propel the music business forward? I believe innovation will come from outside the mainstream music companies, the way it has over and over again across so many different industries. The automobile did not come from the Horse and Buggy makers and refrigeration did not come from the Ice Kings, so why would the next musical innovation come from Warner or Universal Music, or any other indie label for that matter? Just as theatre evolved into motion pictures, then broadcast television, then video tape and dvds to IMAX 3D emersive experiences, so will music continue it’s transformation, propelled by technology and new nimble entrepreneurs.
Musicians of the future need to face the fact that living a life in music is a privilege that they will have to earn through hard work, preparation, innovation and collaboration. Young artists need to be willing to take risks and push the edges of creative expression by embracing the reality that nothing about music is normal anymore.
The team that may be most compelling for creative artists to form is a strategic business manager, a social marketing manager and a technologist.
We need fresh thinking and risk capital to fund the next wave of musical innovators. The Challenge for the Music Business is to create value in the place of falling revenue and to energize the new generation of music fans to really support music. Do you have what it takes to reinvent the business? What ideas do you have that could light the way into the future?
We will be announcing a competition to award a prize for the best ideas shortly.
a harsh but potentially realistic paradigm..ain’t it enough just to make music? depends what u want from it i guess…not if u want an income solely from being an artist perhaps…not sure it was ever easy as a rule but sure change is the only constant hence music unlikely to be immune to that…
Couldn’t agree more. The need to evolve is crucial in the current industry otherwise it will stagnate. People expect more from their experiences and the internet has raised the bar in terms of access to information and new music. The music industry needs to embrace this and move forward.
http://www.somasoapbox.com/2010/02/18/when-will-the-record-labels-open-their-eyes-to-the-blinding-lime-lights-of-live-promotion/
Hey Dave,
I’ve recently made the decision to manage a young hip hop band. What drew me to them was their fan interaction. Taking that one step further we started a “F@#k mainstream media, we got raving fans” campaign. In doing so, we’ve created somewhat of what you stated, “A way of engaging with artists that true fans will fight to get access to.”
We simply asked the fans to review the group’s music vs having to ship off CDs for reviews by media hounds whose opinion we really care nothing about anyway. The response was overwhelming! Once a few of these fan reviews were posted, many more fans wanted their shot at the media spotlight.
Basically, we have built the foundation for a wicked PR team, composed of fans whom promote from the heart, not media pros doing it for money. We’re on the lookout for more ways of making this a truly fan-driven business!
Hi Dave,
I wonder if it makes sense for fans to pay their way into web based performances of their favorite bands. The band could charge X for an audio feed and X*Y for a video feed. They could do the performance from somewhere convenient and comfy and fans could get at least some of the intimacy that they are looking for in a concert.
You could imagine acts getting more and more creative with their shows; or having them get smaller, like a living room concert.
Acts could grow and earn $$$ virally, using the web.
Anyway, food for thought… Michael Ost
(PS: thanks for my first job in the music software biz)
Great, great blog – the musician community that I own and run is, to us, like a living definition of some of the stuff you talk about re the future of music.
We have many, mostly electronic, musicians interacting via free uploads & peer review on the site – we have the data, music and artists already – and we’re just now starting to spin off a label to start making the best of it widely available.
It’s hard to say where exactly it’s going… it’s like a tree, some prevailing wind could shape it one way or a quick frost another, but because we have been on the internet for over 10 years (longest running online music community) and we are 100% volunteer owned and run… somehow I think we’re going to come out with something very unique and with success.
Our new label manager/music director is a Berklee music student and linked me here. I now recall reading some of your book.
Exciting times
If you’d like to know more about sectionz please let me know!
Heh Red – great to hear from you. I like the idea of virtual events for a fee. With some kind of moderated chat and interaction this could apply to shows, writing sessions, rehearsals, etc. Good idea.
eman8ions – Please send over a link to your business, would love to see what you are up to. Dave
Perhaps we should start to utilize the touring entities for more fulfilling purposes that are ongoing like the idea of using tours as recruitment tools for colleges. take that a step further and intern some young artistic folks to be on the tours as well and broaden their learning while facilitating a tour. It keeps the arts alive in schools and could even create a venue for up and coming musicians to “break-in” to the industry. Just a thought!:)
I like that you mentioned that “most of what has been developed thus far is in support of the way it used to be, instead of the way it needs to be.”
The conventional record and radio industry has been dead for over a decade now and one wonders how these businesses continue to make money now that the digital realm has made access to intellectual property available for free and will continue to do so for a long time.
The only scene in the U.S. that I have observed working to create the “way things ought to be” for the future of music lies with the jam-band community. Many of those acts don’t get airplay, don’t have major record companies nor do the principals in those organizations or their fans give a s*** about success on those platforms. These guys simply tour and make money on merchandise and live performances fees. It’s a great model and it’s what continues to work for them and can work for any musical act that is able to achieve some level of success through the sheer hard work and commitment that this type of approach requires.
But…what about the digital realm and the potential that it holds for these types of bands? I find it interesting that a few mainstream artists have decided to connect with an outfit like LiveNation to promote and expand their careers. LiveNation is not a record company, nor is it really a full-bore traditional promotion agency; however, they have developed relations with conventional media (like buying out radio and TV stations) that allows continued exposure for these high-level artists (Madonna, for one).
They also have some kind of edge in terms of being able to get exposure using ‘new media’. But, they have yet to develop a clear and sustainable model for profitability using online technology (other than online ticket services).
Brings up another notion: can online entertainment (other than multi-player video games) be profitable? Can pay to view online streams of music truly make money? By this, I mean, that because the digital realm is inifinitely hackable (i firmly believe this and those of you who read this and are from this scene know what I’m talking about), does this preclude live music entertainment online from being truly successful as a revenue stream?
I guess this is what Kusek was talking about in terms of what the future of music ought to be. For my money, I think the online experience for music will not be the ‘be all/end all’ to an artist’s career; that indeed, the online realm will only be one component of a much larger and deeply interrelated model and that an artist’s success will be dependent largely on how well this person and their support team can modulate the activity within the entire operation.
The short list of business entities that Kusek describes for an artist’s creative is good but must also include touring manager and merchandising manager in support of the tour. I honestly can’t see a future where the artist can remain in one place and pitching the same recorded stuff over and over again in the face of younger, highly intelligent and exceedingly tech-savvy crowds. Kids who go to the shows will do so because they dig the music that they have acquired gratis from digital sources. Or perhaps they have paid what can ( a la Radiohead) and still want to connect with the band on a live show.
Thanks and keep up the good work on Berklee online music. It’s a great website and is the future of e-learning.
Hi David,
I often keep visiting here, but as we discussed again about this post at SectionZ, I just wanted to express how excited we all feel the way the Future of Music is unveiling itself. I love reading your stuff, along with Gerd’s and Andrew’s. I’ve read Music 2.0 PDF lot of times, and wanted to get hard copy of your book, but couldn’t find it on eBay.in.
Btw, I’ve also started reading a book titled The Black Swan, which actualy isn’t quite new; but I feel many of the concepts could be fairly adapted (rather, unveiled mysteriously by itself) for the game of music.
CheerZ
Ronak R. / RokZRooM
“eman8ions – Please send over a link to your business, would love to see what you are up to. Dave”
Hi Dave,
I’ll send you some info that fleshes out something of a direction & intent. Thanks again for sharing your wisdom and providing this fabulous resource site.
Ohh well, I just placed the order of your book on Amazon!
Finally! 
“The oft quoted conventional wisdom that artists can survive on touring and merchandise income is simply not going to work for most bands. Instead, real blockbuster success in the future belongs to those ready to break the rules and create new engaging musical experiences, and unique products and services that cannot be duplicated.”
Aren’t you saying the same thing? Merch and live ARE not easily recreated, which is why they are what we are supposed to rely on. Any media can and will be easily consumed and copied, until some serious at the governmental level happens.
That said, I’m curious to see what is thought of as “unique and not easily recreated” that has not been thought of yet.
Hi Mr Kusek,
Great and highly addictive blog. I can see more opportunity than tragedy in the new music industry, and you are a true leader in the field! Your optimism in times like this is highly infectious. I have sent you a mail via the Berklee Network, I truly hope to be able to work with you in the near future.
Just because the big cats are falling on their faces doesn’t mean us little guys have to fall too, it does mean that there are more opportunities than ever, as for every big cat that falls, there’s a young one itching to take his place.
New industry, new ideas, new faces and a great future for ‘liquid’ music is what I foresee!
The first step lies in accepting that the old ways are dead. That way, there is no competition, only evolution!
Regards,
Martin
Oh and as you can see by the posts left by Ronak and Eman8ions, the ZedHeads (sectionz.com users/ administrators) are all over the ‘new’ industry plan. This is not the last time you guys are going to hear about us!!!
Hi Dave,
Almost every revenue generating opportunity for music is controlled by a decision-maker who must filter through an increasing amount of available songs to find the right fit. There are more than a million songs created and uploaded to the web each year. These decision makers are overwhelmed.
At the same time, this flood of new music makes it ever harder for great music to stand out from the crowd.
Music Xray is a platform that harnesses social media, the wisdom of experts and that of crowds as well as state-of-the-art technology to help make like easier for artists and industry professionals alike.
This is a brief description of how it works: http://mim.io/70e92 Our aim is to help artists get their music directly to the people who can help them and to help those people easily manage and make sense of the music submissions they get.
I’d love to know what you think.
I understand that it’s tempting to equate where we are today in the music world with notable points in the past when innovations changed society. But I’m not sure the analogies with horses-to-cars or ice-blocks-to-refrigerator hold, upon examination. Those were big, society-wide transformations. Things were changing for people at the level of physical need. “Here, you can now start traveling 30 or even 60 miles per hour”; “here, you can now keep food cold indefinitely.”
This is not the same level of innovation we’re talking about with music. For most people, not that much is actually changing because in the end, the final act, the important part, is still just about listening to a song. Yes, the device they’re using to listen is different. Yes, the source of the music may be different. Yes, the control structure is changing.
But I suspect we may better navigate through this time period when we begin to de-monumentalize the situation a bit. Yes, it’s terribly interesting and revolutionary in the context of media history. But we have moved up the scale of needs here, and while it’s important to the soul to be sure, the way music delivery is changing doesn’t interact with large-scale economic movement in the same way as innovations that addressed our more basic physical needs.
Jeremy – I think it is easy to dismiss the gravity situation if one does not care about trying to make a living as a musician. Free and legal music might be a business for a distributor or someone trying to derive advertising revenue, but it does not put food on the table for the artist. That is certainly a basic physical need that must be met. Therefore I don’t think that the issue is how music is being distributed at all, instead it is about earning a living as an artist and how that is changing, and will it even be possible in the future.
Taken from the point of view of survival as an artist, performer, writer, filmmaker, producer, or other creative professional – it most certainly is about basic human needs. Whether innovation will make it possible to stop the bleeding that is occurring throughout the music industry and replace it with something new and compelling that not only meets the needs of the rabid music consumer, but more importantly meets the needs of the creators is the point. Dave
Dave, well put @ jeremy. Even in the countries like mine – ie. India, the things doesn’t seems to be radical in the nooks of the country; but a close look will reveal that there are niches, and there is a scope of innovation there as well. Its not surprising to witness the local labels and those biggies already doing well into niches – at least now – such as T-Series, while the mainstream players really loosing a big pie while trying to enjoy the economies of scale; as the so called illegal options are becoming more & more – widely accepted.
I see the long tail, especially the hits of the niches, will certainly drive the future revenues. Here, economies of scale doesn’t necessarily work the way the economists have formulated.
Good for us.
CheerZ
Ronak R.
from SectionZ.com
it seems to me that there is simply not much of a profit model at all for the musical industry.
recordings hardly sell.
they said that live gigs would save the day but in the end, there is a saturated event calendar in every city. just think of all the small to mid-size events in your town and ask yourself why anyone will go to your event and how they will hear about your event vs the 10 million others.
one fact remains the same – from the old biz to the yet-unborn-biz… the quality and quantity of the promotion means everything, the quality of the music means absolutely nothing!
2 reasons
1) there is a listener for every taste. this is a subjective field. oh how i wish there could be simpler standars- at least in the 80′s metal we knew that the fastest guitar player was the best! simple
2) people are sheep and flock to anything popular because they want approval (to get laid at the end of the day…)
while i agree that the future will be something we cannot even conceive of, this is more of a plea of “HELP SOMEONE SOMEHOW!” than a plan…
we are SOL until something comes along that links music and money… again
@ CeLoT;
“we are SOL until something comes along that links music and money… again” – may be somethings already on its way that could make this happen!? May be its a matter of time before that big thing unveils itself!?
Rest assured, the transition isn’t over yet. But soon, it will be. The way it works is, somehow, Hope, then consciousness and then the reality.
Ronak R. / RokZRooM
This is a great post. I happen to agree with Jeremy about de-monumentalizing things a bit, however I may be coming from a different place. The changes that are occurring and will continue to occur ARE very serious. We can’t de-monumentalizing them to nothing. We have to be clear about things.
These disruptive changes are a very serious matter to those who’s life depends on their art. And those people whose livelihoods depend upon their art know that they must make their living from it in order for them to be able to spend all of their time doing it. Now, however, it is up to them to figure the business side of their art out and be as innovative business-wise as they are in creating their music.
Unfortunately, it seems that people are still reaching for the easy route of signing half of their earnings away to a label who takes care of all of the business aspects for them. I’m not really sure why more artists aren’t approaching their art as any other business would and operate as a company with a small number of employees that operate just like a label-provided business team would. One band doesn’t need more than 8-12 employees even at the highest level. Don’t have money?? Set up a business structure for your band and get interns to help you for free in the start-up phase.
Artists have not been using what has always been right in front of them, which is why I believe that people have been monumentalizing the situation a bit. Nearly every band out there is still looking to the easy routes of the past to push them forward. They won’t.
No one is providing various buying options for their physical music. Why isn’t anyone streaming their mp3′s on their own site to get people to their store to find a wide variety of ways to purchase their physical music? I find that more often than not, artists are failing to do this. I’ve seen far too many artist websites that have a couple of songs streaming with no link to their OWN online store next to them. iTunes does not count. And most times when you do enter the band’s online store, there is merely the option to buy a cd and an LP (if fans are lucky).
Only a few artists have given their fans a much more developed inventory of physical music to choose from, and that depth of options is far more attractive to fans. If you walked into a clothing store and half of the place was full of white, crew-neck t-shirts while the other half was full on one type of denim pants, you probably would leave empty handed. How is a band’s store any different?
The really dedicated fans buy the most premium/limited option, while the newer/undecided fans will download a very cheap lossless quality album download or a CD. Or they will stream until they decide, but at least they will be hanging out on your site in the meantime with things to do while they listen. Make a more involved website that has a more developed store.
The real disturbing thing is that a lot of bands mainly use myspace to showcase themselves, even if they have their own website. Most artists neglect their own websites, which should be the only real destination for your current fans and potential new fans. Why should someone who loves your music have to go search through various social media sites for new information about you? Social media should be frequently updated, but should lead people to the ultimate source of anything having to do with the artist — the artists website.
There are far more examples of artists failing to use what is very much at their disposal. If artists won’t even do this much, how can we expect them to be truly innovative? I certainly won’t expect it. Real innovation will come from the exceptions. It will come from the few who are willing to put in the time and effort into their business AFTER they have put in all of the painful hours into making amazing music. Both are now mandatory for the emerging musicians of today who want to make their art their life’s work.
@Randy,
VERY well put. But, doesn’t the generic lazy nature of artists count here…?! Indeed, exceptional is what we should seek to.. to witness a phenomenal.
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