Music Biz Shakeup

Music Biz Shakeup
Glenn Stefano
DSN News
Tuesday 10/30/2012 10:05:40 (PT) Print

LAS VEGAS -- The entertainment business has really taken a hit since the digital revolution at the turn of the century. Hollywood has seen some dark times thanks to the Internet and other technologies. Not only does it present content on a whole new level, it takes consumers away from traditional media ties such as movies and television. TV, radio and movies have begun to catch up and evolve into new digital platforms, however one sector has felt the hardest blow due to changes in the music industry. Just a decade ago, the record industry pretty much was not reacting to the growth of online music opportunities. Not only did they ignore it, but also they tried to even shut it down!

Thanks to free music sites such as Napster, Kazaa and legal sites like eMusic.com, the record industry had its hands full in litigation. Online users figured, why buy a record, when they can just go online and download it for free. This surge grew on a massive scale, with record companies seriously seeing the effects on their bottom line in no time. This was a force they could no longer ignore! Record labels were some of the most powerful media entities in the biz, and overnight many saw the carpet slip right from under them! Many tried to catch up by launching web portals for users to legally download their content, but the process became quite difficult and slow. The digital age is here to stay, and the music industry must now reinvent itself, or go the way of 8 track tapes!

The changes have spread like a virus, as we no longer see huge record store chains across our cities, radio stations are pretty much automated, and original content is no longer a goal, saving financial face is! How many platinum records have we seen awarded in the last year or so only a handful, as opposed to just 5 years ago!

Veteran music guru David Geffen recently told New York Times Magazine - "only 10 years ago, companies wanted to make records, presumably good records, and see if they sold. But panic has set in, and now it's no longer about making music, it's all about how to sell music. And there's no clear answer about how to fix that problem."

Record sales have pretty much hit an all-time low, with many record labels filing bankruptcy, or being merged with other struggling entities. Music downloads are at an all time high on the other hand, with mainstream retailers like Wal-Mart and Starbucks getting in on the act.

The reining king of the music industry today is none other than Apple CEO Steve Jobs, who owns the popular iPod music player and iTunes online music store. Jobs recently shared with CNN, his formula for the success of itunes: "Napster and Kazaa certainly demonstrated that the Internet was built perfectly for delivering music. The problem is they're illegal. And so our idea was to try to come up with a music service where you don't have to subscribe to it. You can just buy music at 99 cents a song, and you have great digital -- you have great rights to use it. You can burn as many CDs as you want for personal use, you can put it on your iPods, you can use it in your other applications, and you can have it on multiple computers. And we were able to convince the big five music companies to go along with us on this. So it's a pretty landmark offering. Nobody has ever seen anything like this before."

Jobs bet has paid off in serious dividends in just a few years, and yes the major labels are all on board. This has also opened the door for many new musicians and entrepreneurs as well. Thousands of new online record companies are popping up to fuel the fire, as well as knock off pay music services.

So, with the music business finding a new form of distribution via the internet, and even cell phones... what do we do with all those CDs? Well, many industry insiders say within the next 15 years, we could see CDs go the way of audio cassettes, remember those!

As far as the artists are concerned a whole new era has begun, which will bring their music to millions around the world! As for the consumer, well the skies the limit for music enthusiasts. The old days of Hollywood music tycoons may have gone the way of Tower Records and such, but the music lives on!