WEB207 – How have digitisation and convergence impacted music? (WEB207)

Convergence and the digitisation of music have changed the way we access and listen to music, which in turn has led to the development of business models that support music as a service rather than music as a product. The music industry has been reluctant to embrace the changed behaviours of music audiences, which is not dissimilar to the way the industry has historically responded to changed audience behaviours and the introduction of new technologies. Instead, the industry has placed barriers up to protect revenue and intellectual property rights without considering the potential opportunities that new music distribution models and listening behaviours can afford artists and the industry as a whole. Considering the potential for increased exposure to new audiences, streaming and music on-demand is a viable distribution model that meets the needs of consumers and artists/rights holders.

 Jenkins (2004, p.34) defines convergence as ‘more than simply a technological shift’, stating that it ‘alters the relationship between existing technologies, industries, markets, genres and audiences’. Convergence in the field of music then, is illustrated by changing audience behaviour which is driving technological changes to meet the new demands of the music listening audience. Richardson (2014, p.74) writes that ‘Increased access and availability of high speed Internet – as well as the digitisation of music (and most other forms of media) – has altered the landscape of content creation, protection, and distribution’. Over the last decade or so, the internet, even more so with the evolution of web 2.0 tools, has ‘brought tremendous changes in the tools and possibilities for musicians and audiences to interact with each other’, (Baym, 2010). Baym (citing Stuart Braithwaite, 2010) further emphasises the impact of the internet on musicians: ‘we’ve become popular in places that if it wasn’t for the internet, people wouldn’t have heard who we are’. Given the increased exposure the internet has provided you might expect to see more efforts by artists, labels and rights holders to harness opportunities to capitalise on digital delivery models.

To understand why the music industry was not so enthusiastic about embracing these changes, it is necessary to look at how the industry has historically dealt with changes in technology and shifts in audience listening behaviours. Kot (2009, p.29) writes that prior to being recorded, music was consumed live, and the industry was financially modelled to generate income from live performances. The industry perceived the introduction of the phonograph (for home listening) as a threat to ticket sales for live shows. In the 1930s, radio was seen as a threat to phonograph sales – why would anyone buy a record if they can listen for free using radio? In the 1980s with the introduction of cassette tapes and home recording, the industry ran advertising campaigns espousing the piracy of the new technology: “Home Taping is Killing Music”. Wikstrom (2010, p.152) too writes of this campaign,

‘When the compact cassette technology was developed, it also incited a creative and social music listening culture with phenomena such as dubbing, “bootlegging” and mixtaping. A whole range of new audience actions was opened up to the public. However, it was difficult to collect immediate revenues from the audience’s new actions.’

The industry viewed this new technology as a threat to control over intellectual property rights and existing revenue streams. Kot (2009, p.29) points out that not only were these industry concerns unrealised, research actually supported the fact that people who recorded copies of albums at home were also still actively buying records. ‘Home taping gave more people access to more music than ever before, and their appetite for music only increased’.

Also providing people access to more music than ever before, Napster, a peer to peer file sharing application launched in 1999, became a ‘hub for mass digital music sharing and exchange’ (Nowak, Whelan, 2015). Napster enabled people to share their digital music files, which not only triggered concerns around piracy and loss of copyright revenue but also transformed the way music was consumed and delivered (Richardson, 2014, p.47). Music no longer needed to be bundled in album format as consumers could select to only download particular tracks. Music also ceased to be just a physical product, with music owners increasingly expecting to be able to own their music in digital file formats. Napster also influenced an expectation that music could be owned for free; Richardson (2014, p.48) suggests that access to free content was the lure that attracted music owners from physical to digital formats. Nowak and Whelan (2015) describe this as the Napster “moment”,

‘a convergence, a hybrid network: a disruptive articulation of format, medium, platform, network, hardware and social and cultural practice, at a particular critical juncture in the history of the Internet, and in the history of recorded popular music as mass entertainment.’

Napster was unable to develop a viable business model following the outcomes of legal actions from A&M Records Inc. and ceased operations in September 2002. Several record labels attempted to capitalise on digital distribution by establishing their own digital stores, which provided streaming and download options, but these did not gain traction for a variety of reasons, including consumer demand for free music. It was only when Apple introduced iTunes in 2003 that a ‘convenient, legitimate and viable’ alternative arose. (Richardson, 2014, p.49).

Apple iTunes provided a consolidated digital online delivery service, meaning consumers did not need to register or subscribe to multiple online stores. Apple had effectively cut record labels out of the distribution chain and provided a legitimate digital song by song purchasing framework ‘further eroding both the market for traditional physical albums ownership, and of upending album bundling norms in the recording industry’ (Richardson, 2014, p.50). Alongside this, several music streaming services, such as SoundCloud and Pandora began to operate. These services were not interactive however and did not allow the listener to select in advance particular tracks that they wished to listen to. In effect, these streaming services were performing much the same function as a traditional radio service; radio services at the time were attracting less younger listeners than they had in the past (Berry, 2006, p.148). Younger listeners were somewhat fussier in their listening habits than the generation before them and, given that they had grown up knowing ‘digital choice, computers, the internet and mobile phones’ (Berry, 2006, p.149), sought out new ways to listen online. The challenge for the music industry was how to harness the hunger for new ways to consume music that engaged the generation that had grown up being able to access music easily and without paying for it. This became the selling point for an interactive streaming service launched in 2008 – Spotify.

Spotify provides an on-demand streaming service which allows consumers to choose what songs they want to listen to from a catalogue (as at 2014) of over 30 million tracks (Marshall, 2015, p.179). Listeners can subscribe for a fee or register for free, with advertising used to subsidise access fees. What is important to note is that Spotify represents a significant shift from a physical ownership model, to an access model, where music is distributed as a service that can be accessed rather than a product that can be owned. MarshalI (2015, p.184) writes that Spotify was

‘launched out of a desire to develop a better, more convenient and legal alternative to music piracy. Spotify now monetises an audience the large majority of whom were downloading illegally (and therefore not making any money for the industry) before Spotify was available’

The business model of Spotify has attracted the digital generation and also meets the existing strategies of the major labels and rights holders by providing financial benefit based on how many times a track was accessed, much the same as the units sold methodology for physical sales. What is different though is that under the physical ownership model, a consumer paid a lump sum up front and in the access model, consumers continually pay for access to the music. Rights holders will receive smaller payments on a continuous basis rather than a large payment up front (Marshall, 2015, p.181).

The internet has provided opportunities to distribute and consume music in radically different ways than in the past. The format of music has shifted from analogue to digital, from physical to downloadable and from a product to a service. Consumer behavior has changed from listening to a radio station with no interactivity to listening to a music stream where all songs are selected in advance; from owning a product that can be listened to as often as the product lasts to accessing a service that will enable listening for as long as a subscription is active. Convergence has shifted the way we distribute and consume music, and despite some battles around copyright issues, royalty payments and piracy concerns, the industry is at a point in time where an organization such as Spotify is seen as the ‘poster boy of a new, optimistic, digital record industry – the one that has stopped bleating about piracy and is doing something new and funky’ (Marshall, 2015, p.179). We’re all listening intently.

References:

Baym, N. (2010b, September 21). Social Media from Musicians’ Perspectives. Online Fandom. Retrieved November 24, 2010, from http://www.onlinefandom.com/archives/social-media-from-musicians-perspectives/

Berry, R. (2006). Will the iPod Kill the Radio Star? Profiling Podcasting as Radio. Convergence: The International Journal of Research into New Media Technologies, 12(2), 143 -162. doi:10.1177/1354856506066522

Jenkins, H. (2004). The Cultural Logic of Media Convergence. International Journal of Cultural Studies, 7(1), 33 -43. doi:10.1177/1367877904040603

Kot, G. (2009). Napster vs. Metallica. In Ripped: How the Wired Generation Revolutionized Music (pp. 25-39). New York: Scribner.

Manovich, L. (2009). The Practice of Everyday (Media) Life: From Mass Consumption to Mass Cultural Production? Critical Inquiry, 35(2), 319-331. doi:10.1086/596645

Marshall, Lee. Let’s keep music special. F—Spotify’: on-demand streaming and the controversy over artist royalties. Creative Industries Journal, Vol. 8 Issue 2, 2015

Nowak, Raphael; Whelan, Andrew. Editorial: On the 15-year anniversary of Napster – Digital music as boundary object. First Monday, [S.l.], oct. 2014. ISSN 13960466. Available at: http://journals.uic.edu/ojs/index.php/fm/article/view/5542/4121 doi:10.5210/fm.v19i10.5542.

Richardson, James. The Spotify Paradox: How the Creation of a Compulsory License Scheme for Streaming On-Demand Music Platforms Can Save the Music Industry. UCLA Entertainment Law Review 22(1), 45-[i].

Sinnreich, A. (2010). The Crisis of Configurability. In Mashed Up: Music, Technology, and the Rise of Configurable Culture (pp. 69-89). University of Massachusetts Press.

Wikstrom, P. (2010). The Social and Creative Music Fan. In The Music Industry: Music in the Cloud (pp. 147-169). Polity.

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