“Free and Easy” Disruption Dismantles Music

When you look at the sudden free fall of the music industry due to disruptive technologies, you can’t help but empathize with an industry that was completely blindsided and not equipped by any means to handle such a sudden alteratiaccon in the way music is made, bought, and distributed.  The question we find ourselves asking is, “What drove this change in the industry?” Music torrent sites like Napster, streaming services such as Spotify, and music production applications like GarageBand are all examples of these disruptive technologies, but I would describe them as the effect of disruption and not necessarily the cause of it.  I think the main ingredient of the music industries spiraling downfall is the consumer. Like all disruptive technologies, the music industries disruption is based on the fundamental question “How can we make the consumer’s life easier?”

“Free” and “easy” are the words driving the changes in the music industry.  Why pay for music when I can get it for free? Why drive to a store and purchase my favorite artist’s album when I can do that with just a few clicks of the mouse? It was these concepts that anyone could get music for free through file sharing that drove Napster to such prominence that wounded record sales to such an extent that they never fully recovered. Napster of course would not have been able to thrive without the internet and file sharing capabilities that were becoming a big presence in the late 90’s and early 2000’s. Not only did Napster give society the chance to obtain artists’ albums for free, but also it popularized the idea of downloading music on your computer without the hassle of going to the store and purchasing music.  It’s no coincidence that Apple’s iTunes really took off after Napster disbanded in 2002.  Society became enamored with the ease through which you could purchase a song and add it to your MP3 player with just a few simple clicks of a mouse.  With Napster no longer an option to illegally obtain music for free, other peer-to-peer file sharing services such as Limewire and BitTorrent began to emerge, along with Youtube to MP3 websites after 2005, to satisfy the consumer’s need to not have to pay for music.

As technology increased its capabilities, so did the ease through which music could be created, distributed, and bought.  Why pay $1.29 per song on iTunes when you can pay a monthly fee on Spotify or to stream music on Pandora radio?  Nowadays the area of the music industry that is feeling the powerful influence of disruptive technologies are recording studios.  Popular Recording studios such as this one in Soho in Manhattan may soon go by the wayside with the lack of use by artists. But this begs the question, “why pay incredibly high rates to use a recording studio when GarageBand and other recording services are available right on your own computer?”  It is very likely that we could soon see more recording studios and even record labels become a thing of the past. http://www.fastcompany.com/3032642/why-the-music-industrys-next-big-disruption-is-in-the-recording-studio

So what is to come for the music industry? What new products are going to make life easier for consumers to have access to their favorite artists? A new platform of music streaming called Direct-to-Fan has made it possible for independent artists to bypass record labels and sell their music or merchandise directly to their fans through websites such as Musicglue.com  or Nimbit.com.  The logic here is, if you’re an artist, why give record labels and music/merchandise distributors a significant cut of your revenues, when it would be much cheaper to use one of the aforementioned websites?  Another new product consumers are beginning to use is Periscope.  Periscope is a live streaming app that allows the user to view live videos that other users are uploading and the user can upload their own live stream.  Periscope has come under fire as some users are using the service to stream live concerts or sporting events, which violates broadcasting copyright law.  Once again the consumer is finding new ways to avoid paying expensive ticket prices for events that they can watch for free from the comfort of their own home.

The question the music industry is asking itself, was there a way its collapse could have been prevented? Is there anything that can be done to stop this downward spiral?  According to this article there is still something that can be done to prevent further collapse but this Forbes article does a great job explaining why the music industry is “beyond all recognition” thanks to disruption. Finally this video also gives a brief description about the causes of disruption in the music industry.




3 thoughts on ““Free and Easy” Disruption Dismantles Music

  1. Nicholas Sibilia

    This topic is one of many that are highly discussed and debated upon in recent years, the information disbursed helped me get a much better understanding on what is happening because of illegal downloads. For example I was unaware that record labels and recording studios were taking major hits from these downloads. However one critique I had was that the information given was very brief and limited, for example, how does it hurt the record labels or recording companies, what could be done to fix this problem, and is it fair to be charging people $1.29 per song? Overall this article was very well written and had very good language, but it would’ve helped to have gone a little further on some points.

  2. Paras Patel

    Was there a way the music industry’s collapse could have been prevented? I don’t think the music industry has collapsed, but rather just one “pillar” of it; the music industry as a whole is still thriving with the support of new “pillars”, such as streaming services and mobile studios through the use of platforms like GarageBand. I believe the collapse of traditional methods of recording and distribution of music should have been expected with the development of technology and it was negligent for affected firms to not adapt and pioneer the new trends. These companies were so invested in the now that they didn’t prepare for an evolving industry in the long run, which came back to hurt them. To prevent the downward spiral, the smartest move for disrupted firms would have been to roll out a streaming service of their own or partner with an established streaming service and provide exclusive content from their label to the service. Record labels failed to do this until it was too late and the effects started to impact their artists with diminishing royalties. Prominent artists like Taylor Swift resorted to pulling her music off of Spotify because it was not good for her business. Many artists banded together behind rapper and businessman Jay-Z to launch the Tidal streaming service, which also provides an option for higher quality music for listeners. Tidal gave artists a greater share of their music royalties than they would receive with services like Spotify.
    I believe the next logical step for firms in the music industry to take without taking another hit from disruption would be to continue to stay innovative. As Steve Jobs famously said, “A lot of times, people don’t know what they want until you show it to them.” Firms need to stay ahead of the curve and pioneer unknown ideas if they plan on existing in the future. It is hard to see what the next big disruption for music will be when we’re currently in the cloud and streaming era, so it is up to the firms to stay innovative. Tidal recently announced that it is going to start offering its own original programming. I’m not sure what the result of this will be, but it is an effort by Tidal to stay competitive and differentiate itself with competitors like Spotify.
    What if Tidal had a merger or partnership with Netflix? Netflix has already claimed the throne for original programming and streaming movies and TV shows. One of Netflix’s main competitors is Amazon, which also offers its own selection of original programming in addition to streaming movies and TV shows. Instead of Tidal spending its resources on developing its own content, it can partner with Netflix. It would definitely be a bold move by both firms that would cause disruption in both the music and TV/movie industry. In their launches, Tidal and Netflix both brought something new to the table. Netflix wiped out firms like Blockbuster with its DVD mailing service and by pioneering streaming movies, later expanding to TV. Tidal put some money back into artists’ pockets and offered a higher quality experience. Together, the two can bundle their services, reach an even larger audience, and learn from each other’s innovations to keep pushing themselves in their respective industries.

  3. Pingback: An SWOT Analysis of the Music Industry | DT&L Blog

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