Keynote: A Futuristic Outlook on the Creator, Consumer & the Business in Between from SKAP on Vimeo.
(Adapted from a short blog post as part of Music Industry studies at NMIT, 2014)
In this recent talk, Gerd Leonhard (co-author of ‘The Future of Music’ and early adopter of the phrase ‘music like water’) speaks about the music industry progressing from the old ‘product’ model (CDs etc) to the current ‘service’ model (streaming services such as Spotify), but not yet truly reaching the point where music becomes like water. Part of the problem is that as of 2013 only roughly 2% of the global population paid for downloads or streaming services, and although growing, Spotify had only 7 million users – Leonhard argues it needs more like 700 million subscribers to truly be viable for artists.
Leonhard believes there is enough money to pay artists if the consumer numbers are there, but sees the US$10/month subscription as a barrier to access, when consumers have come to expect music to be ‘free’. He suggests a possible future solution is to make music ‘feel like free’ by bundling streaming services with internet access, which with 600 million users in Europe at 1 euro/month would generate the equivalent of 40% of global recording earnings. Similar bundling could be done with mobile phone plans (another 400 million European users). Clearly a lot of work would need to be done for this to happen on a global scale, but at the very least it’s a valuable contribution to the conversation on monetizing digital distribution.
Lecture notes from Leonhard’s talk are available to download here.