Apple Music disrupts the global music industry and marginalizes record companies
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Over the past few years, it has become clear that the growth of streaming music services is not good for artists. Interestingly, there was a similar voice in the industry when Apple first launched the iTunes Music Store. At the time, people in the music industry were worried that this move would lead to people only buying the music they liked, rather than the entire album. They believed that selling albums for $9.99 instead of selling singles for 99 cents would be better for everyone. If you don't know the economics of the music industry right now, the simple thing to say is that the industry is currently structured against most artists. You have to be a very successful star to get 10% to 25% of sales, depending on your negotiation skills. (This is pretty much the same as it was 15 years ago.) Record labels are like investors. They usually invest money in artists upfront and get a percentage of sales. The record company pays to record the album, promote it, and, in the past, get it to retail. There's a whole mechanism behind it, and it works well. However, it's not just the record company and the artist that are involved in the distribution of sales revenue. Sales revenue usually also needs to cover licensing costs, songwriter fees, publisher fees, and a host of other expenses. There are five to seven ways to divide the 99 cents per song sales revenue, and the exact mechanism is very complicated. However, if you ask music industry experts, they will tell you that the real money for artists comes from live performances and concerts. After being discovered, signed, released, sold, and promoted on radio, TV, and the Internet, artists will be able to achieve the ultimate goal: live performances. We can look at the economics and politics of the music industry all we want. However, as an artist, we need to consider how the industry structure, once streaming music is introduced, will help artists attract enough fans to earn income from live performances. It is clear that the music industry is evolving and free and paid streaming music services are now part of the business model. Only when artists are successful enough to go on tour or release multiple hit albums can they get better commercial contracts. Based on this, we can judge what impact the current developments will have on the future of the music industry. Music Production and Discovery If you are an artist who has just signed to a record company, the commercial contract will undoubtedly not be very generous. What I want is to get my songs played frequently on the radio and top the charts to attract attention and fans. In the past, some music critics would select their favorite songs and recommend them to listeners through radio. This process is not done by algorithms. As an artist who wants to be discovered, I am not sure I want to put my fate in the hands of a computer algorithm. Radio DJs play a vital role in the success of artists. Therefore, it is interesting to see Apple develop a radio station service produced by DJs. If Apple can design a variety of radio stations with different styles and invite DJs to create content. This will not only help listeners get the best music in each style, but also help them discover new works, which will have an important impact on the success of artists. Interestingly, such a service already exists, namely Dash Radio. The founder of this service is DJ Skee, a well-known DJ and host of XM Radio. Dash Radio provides music channels of different styles produced by DJs. The idea is that compared with algorithms, human beings are the ultimate content production tool. I agree with this point of view. Record companies are no longer necessary . According to the above, the work done by "record companies" usually includes investment, marketing and release. However, in the current changes, record companies will no longer be necessary in the future. Compared with the past, it has become easier for artists to record, distribute, and release their own records. Although many artists are not good at marketing and need help from others, the Internet and social media have brought them powerful self-promotion tools. If music critics always try to discover good music and recommend it to listeners through online radio stations, this will help them attract more listeners. In the current digital age, it can be seen that the traditional role played by record companies is weakening. While record labels aren’t going away anytime soon, it’s worth noting that Apple is creating a more artist-friendly market, such as providing content discovery and distribution services. The final piece of the puzzle for the entire music industry, then, is the concerts. Festivals It’s unclear what Apple would do if it held an iTunes Music Festival. Apple could use such an event to learn and refine the idea of a global music festival. It’s conceivable that Apple would host such an event around the world, attracting many fans and helping artists gain global appeal. Remember, artists make the majority of their income from live performances, so Apple’s festivals would attract artists. For some artists who are new and less well-known, Apple provides an excellent platform to help them get to know more fans. It’s not clear whether Apple will do this, but it’s an interesting concept from the artist’s perspective. If you think about the future of media in general, the question remains. 10 years ago, many commentators believed that changes in the music industry would come faster, but this has not been the case. But whether fundamental changes are happening or not, the next five years will be more interesting to watch.As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity. |
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