2000s in the music industry

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In the first decade of the 21st century , the rise of computers as the primary means of recording, distributing, storing and playing music led to widespread economic change in the music industry, fundamentally changing the relationships between artists, record companies, promoters , retail music stores, technology industries, and consumers. The emergence of digital music consumption choices contributes to some fundamental changes in consumption. First, the decline in album sales. With the increasingly popular A la carte sales model, consumers are no longer downloading the entire album but choosing a single song.

The early stages (from about 1998 to 2001) of the digital music revolution were the emergence of a peer-to-peer network (P2P) that allowed free exchange of music files (such as Kazaa and Napster). In 2001, the cost of hard drive space has come down to a level that allows pocket-sized computers to store large music libraries. The iPod and iTunes systems for storage and music playback are becoming very popular, and many consumers are beginning to transfer their physical recording media (such as CDs) to computer hard drives. The ITunes Music Store offered legal downloads starting in 2003, and competitors soon followed, offering a variety of online music services, such as Internet radio. Distribution of digital music is aided by the wide acceptance of broadband in the middle of the decade. At the same time, recording software (such as Avid's Pro Tools) began to be used almost exclusively for recording, presenting expensive multitrack recording machines (like 1967 Studer) almost obsolete.

The main economic impact of this change is the dramatic decline in revenues from recorded music. In the 21st century, consumers spent less money on music recording than in the 1990s, in all formats. Total revenue for CDs, vinyl, cassettes, and digital downloads in the US fell from $ 14.6 billion in 1999 to $ 9 billion in 2008.

The popularity of internet music distribution has increased and in 2007 more units have been sold over the internet than in other forms. However, as The Economist reports, "paid digital downloads are increasing rapidly, but do not begin to cover the loss of revenue from CDs." The 2000s period contrasts sharply with the 1984-1995 "CD boom", when average profit margins are above 30% and industry executives are notorious for their high, even reckless expenditure.

Major record labels consistently fail to notice warnings or to support measures that include technological change. In the early years of the decade, the industry fought illegal file sharing, successfully shutting down Napster in 2001 and threatening thousands of individuals with legal action. It failed to slow the decline in income and was a public relations disaster. Some academic studies even suggest that downloads are not the real cause of decline.

The turmoil in the industry changed the balance of power among all the different players. The main music stores just like Tower Records (which once held a major influence in the industry) went bust, replaced by box stores (like Wal-Mart and Best Buy). Recording artists are beginning to rely primarily on live performances and merchandise for their income, which in turn makes them more dependent on music promoters like Live Nation (which dominates the promotion of the tour and has a large number of music venues.) In order to benefit from all artist revenue streams , the record company began to rely on "360 deal", new business relationship pioneered by Robbie Williams and EMI in 2007. At the other extreme, the record company also uses simple manufacturing and distribution transactions, which gives percentage to artist, but not cover marketing and promotion costs. Many new artists no longer see a "record deal" as an integral part of their business plan altogether. Inexpensive recording hardware and software makes it possible to create high quality music in the bedroom and distribute it through the internet to viewers around the world. This, in turn, caused problems for recording studios, record producers and audio engineers: the Los Angeles Times reported that, in 2009, as many as half of the city's record facilities had failed. Consumers greatly benefit from the convenience of being able to share music from computer to computer, either over the internet or by physical CD exchange. It has given consumers an unrivaled choice in music consumption and has opened players to niche markets that previously had little access. According to Nielsen and Billboard reports, in 2012 digital music sales beat physical sales of music.

Video 2000s in the music industry

Industrial Finance

Record sales

The table is a meta-analysis of eight IFPI annual reports

In 2008, 123m of physical albums were sold in the UK, compared to 131m in 2007 and 151m in 2006. With an average price of Ã, £ 7.72, the CD was more than 25% cheaper in 2008 compared to year 2000.

Delivery Creation

The numbers below (in millions) show the overall size of the US voice recording industry based on manufacturer shipments at a suggested price.

The record store

The transition from CDs to digital downloads has shrunk the recording industry for most of the decade, leading to mass layoffs, and artist-label cuts on major labels. In the US the number of CDs sold fell from 942.5 thousand in 2000 to 240.8 thousand in 2011. Around 2,680 record stores closed in the US between 2005 and early 2009. In the UK, all national specialist music retailers have failed except for HMV, a variety of retailers who once became the largest music retailer in the UK.

Maps 2000s in the music industry

Peer-to-Peer (P2P) Peer-to-Peer (P2P) Peer-to-Peer (P2P) Peer-to-peer_28P2P.29_downloading ">

Fajar P2P: Napster

Napster is an online music file sharing service created by Shawn Fanning when he attended Northeastern University in Boston and operated between June 1999 and July 2001. This technology allows people to easily copy and distribute MP3 files amongst each other, through an established market for such a song and thus led to allegations of the music industry of massive copyright infringement.

The first peer-to-peer case is A & amp; M Records, Inc. v. Napster, Inc. , 239Ã, F.3d 1004 (9th Cir 2001). The Court found that Napster was responsible for copyright infringement of the end user for "knowingly encouraging and assisting the infringement of the plaintiff's copyright." Although the original service was closed by a court order, it paved the way for larger decentralized peer-to-peer file distribution programs such as Kazaa, Morpheus, Grokster, iMesh, and Limewire, which have been much more difficult to control because they are practicing a more technical approach and legally creative.

Share files and their effects

Numerous studies have found that file sharing has a negative impact on record sales. Examples of such studies include three papers published in the April 2006 issue of the Journal of Law and Economics (Liebowitz, Rob and Waldfogel, Zentner). Alejandro Zentner noted in another paper published in 2005 that global music sales declined from about $ 38 billion in 1999 to $ 32 billion in 2003, and that this downturn coincided with the emergence of Napster in June 1999. Using data aggregate Stan J. Liebowitz argues in a series of papers (2005, 2012) that file sharing has a significant negative impact on record sales.

In March 2007, the Wall Street Journal found that CD sales dropped 20 percent in a year, interpreted as the latest sign of a shift in the way people acquire their music. BigChampagne LLC has reported that about a billion songs per month are being traded on illegal file-sharing networks. As a result of this CD sales decline, a large number of record stores will go out of business and "... making it harder for consumers to find and buy old titles in stores." On December 19, 2008, Wall Street Journal reported the following:

After years of suing thousands of people for allegedly stealing music over the Internet, the recording industry will drop its legal attacks for seeking a more effective way to combat online music piracy. The decision represents a sudden shift in strategy for the industry, which has opened legal proceedings against about 35,000 people since 2003. Critics say lawlessness ultimately does little to affect the wave of illegally downloaded music. And it created a public relations catastrophe for the industry, whose lawsuits are targeted, amongst others, a single mother, a deceased person and a 13 year old girl. Instead, the Recording Industry Association of America said it plans to try an approach that relies on cooperation of Internet service providers.

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Digital business model

With the explosion of formats and the creation of legitimate digital content, IFPI observes that three major business models have increased to dominance. They are a-la-carte, subscription service, and ads-based.

A-la-carte_ (Download_Store) "> A-la-carte (Download Store) >

A-la-carte is a service that sells individual songs, usually for $ 0.99 and now $ 1.29. They are known by consumers as "Download Store". Its main provider is the iTunes Store (Apple Inc.), which surpassed Wal-Mart to become the largest music retailer in the US in April 2008. Sector leaders include:

• iTunes Store
• Amazon.com
• 7digital
• Emusic
• TuneTribe

Hundreds more stores operate around the world, often only prominent in certain countries or special genres. The third type of carrier never sells directly to the public; it offers branded whitelabel stores and portals for organizations including rock-and-mortar music stores, mobile phone operators and ISPs.

Some services that initially only offer streaming songs now also offer a-la-carte downloads, either through a third party (eg Spotify) or fully integrated (Deezer, Juno Digital, Rhapsody, etc.).

In 2009 Rolling Stone reported a price war between iTunes and Amazon MP3. Bill Carr, vice president of digital media for Amazon.com mentions the following digital music "one of the great benefits of digital business versus CD business is that we can experiment with price changes for an hour, a day or how long we like, without affecting inventory."

Subscription service

The subscription service offers unlimited consumer downloads for a monthly fee. This approach, according to the Open Music Model, theorized to maximize revenue in the long term. The leader of this sector is Napster, which costs $ 12.95/month and offers 6 million downloads and now offers a $ 5 per month program. Napster's net revenue for the quarter ended June 30, 2008 was $ 30.3 million. Sector leaders include:

• Napster
• Rhapsody

Ad-based services

Ad-based services offer free music to consumers, while funding comes from advertising. This model is widespread as seen by the success of AOL Music, Yahoo! Music and YouTube (multimedia providers). Many of these services are Internet radio stations, as they offer continuous streaming of music, while others are not constantly streaming. Many of these services offer multimedia or additional services. For example, MySpace (owned by Fox Interactive Media) offers social networking as its flagship service. comScore reported the top 10 in internet radio show in the United States:

Other sector players:

• YouTube
• MySpace

See also List of internet radio stations

YouTube (owned by Google Inc.) is the main site for finding music videos for independent bands and mainstream bands that have released their music on CD or digitally, while also being useful for finding rare songs. YouTube is a multimedia provider, so it's hard to say how much entertainment has been provided for music consumers, but that gives about a third of the 11 billion online video display in the US in April 2008.

The site also tests three new landing pages dedicated to popular news, movies and music categories. Each page will be populated with the most popular content on the site associated with that category. Some even praise YouTube as a "digital successor to MTV" because they seem to position themselves that way. Currently, they have mixed relationships with labels proven by their cool relationship with Warner Music Group but a more upbeat relationship with Universal Music.

MySpace (owned by Fox Interactive Media) is also a key player and Rolling Stone reports that it hosts over 70 million users every month and that "site visitors can hear either Bob Dylan's or The White Stripes' entire catalog ". Unlike many services, MySpace has successfully created a copyright agreement with the RIAA "Big Four", namely Sony BMG, Warner Music Group, Universal Music and EMI, in September 2008. In January 2009, MySpace partnered with the following independent labels: Nettwerk, INgrooves, Iris Distribution, RoyaltyShare, and Wind-up Entertainment. In March 2009, CNET News reported that there are more than 5 million bands with music on the streaming-and-discovery music service, and over 100 million playlists have been created.

Pandora Internet Radio is different from YouTube and MySpace because it offers consumers streaming media continuously rather than non-continuous music, which makes it very similar to terrestrial or television. However, this can be contrasted with the radio as it offers music recommendations. YouTube is similar to Pandora because it also offers recommendations, but differs in content created by users.

New types of services that also become popular are sites that allow consumers to pay what they want or pay by advertising on social networking sites. Sites like NoiseTrade.com and comeandlive.com are examples of sites that sponsor artists and allow users to download music in exchange for advertising for the artist. Music is basically free for users who basically just spend the time it takes to send information about artists downloaded on Facebook, Twitter, or email. Another example is the release of Radiohead album In Rainbows where users can download albums and name their own prices. The idea of ​​paying for what you want is the consumption of new music, but growing with the user and growing.

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Formatting problems

Analog drop, digital boost

This trend has broader implications for the use of formats. It has become a trend in music, television, film, and print. The Recording Industry Association of America (RIAA) reported sales data of the music industry with formats over a ten-year period from 1998 to 2007. The data in the table below are from the 2007 report.

Market share format

Note: These numbers represent data collected only from RIAA member labels, which are only part of the total online music being exchanged.

Statistical analysis shows large-scale changes in distribution:

• A full-length CD distribution (based on percentage of total music revenue) peaked in 2004.
• Between 2004 and 2007, full-length CD sales fell linearly by about 2% per year. During this time period, Digital Download has increased from 0.9% to 11.2%.
• Of the 10% total market growth taken by Digital Download, about 8% comes from losses in full-length CD sales.
• The full-length cassette suffered the largest loss (-14.5% market share) in the 10-Year period, although most losses (-13.1%) were experienced from 1998-2003. In 2007, they were defeated by Vinyl.
• Since 2007, only two formats have more than 10% of the market: full-length CDs and Digital Downloads.
• The ratio of digital to analog sales in 2004 is approximately 1.99, but in 2007 it was approximately 1: 9.

In 2008, physical album sales fell 20 percent to 362.6 million from 450.5 million, while sales of digital albums rose 32 percent to a record 65.8 million units.

Format proliferation

The advent of digital media has led to the creation of new music formats suddenly available to the average consumer. In 2003 there were fewer than 10 formats available, but in 2007 there were over 100 formats. Today one artist release can be packaged in various formats including video downloads, ringtones or full mobile tracks. As the International Federation of Phonographic Industries (IFPI) notes:

In 2003, the music distribution format was numbered in a single number - today, the number reaches hundreds... In the digital age, the recording company licensed music on multiple platforms, in multiple formats and with hundreds of different partners.

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Mobile

MP3 player

The emergence of an MP3 player, which is a consumer electronic device that stores, organizes, and plays audio files. Some DAP (digital audio players) are also referred to as portable media players because they have support for viewing pictures and/or playing videos. The first mass-produced DAP was created in 1997 by SaeHan Information Systems, which sold domestically the "MPMan" player in mid 1998. In October 2001, Apple Computer (now known as Apple Inc.) launched the first generation iPod, DAP hard drive based on 5 GB with Toshiba 1.8 "drive.With the development of a minimalist user interface and smaller form factor, the iPod was originally known to users of the Macintosh community.In July 2002, Apple introduced a second-generation update to the iPod that was compatible with computers Windows via Musicmatch Jukebox (now known as Y! Music Musicmatch Jukebox). The iPod series, which is evolving with the included microdrive and flash-based player, has become the market leader in DAP.

Smartphone

The 21st century sees the birth of 3G enabled phones, enabling network operators to offer users a wider range of more sophisticated services while achieving greater network capacity through increased spectral efficiency.

The main advantage of 3G enabled phones over MP3 players is their greater web integration. This allows users to easily access the number of songs that are much larger than can be done by users of MP3 players. For MP3 players, songs must be stored before the user leaves their computer, but with a 3G enabled phone, the device is not separate from the source. In 2009, it was projected that revenues from mobile and entertainment media services (MME) in the US would more than double by 2014.

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Consumer Genre Preferences in the US.

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Other important developments

In court

• On December 19, 2008, the RIAA announced that they would stop suing file shareholders, as the strategy did not work to stop the flow of illegal downloads. Instead, the RIAA is trying to work with ISPs to prevent P2P piracy. "The decision represents a sudden shift in strategy for the industry, which has opened legal proceedings against about 35,000 people since 2003".
• On June 18, 2009 CNET News reported Jammie Thomas-Rasset was found guilty of deliberate copyright infringement in Minneapolis federal court and had to pay the record industry $ 1.92 million. This legal battle, Capitol Records, Inc. v. Thomas-Rasset , marking the first time the record industry debated file sharing cases before the jury.
• In France, a new law on illegal downloading, called HADOPI, is being debated. If passed, it will force the Internet provider to close the subscription while still receiving monthly payments. This double penalty is highly criticized.

In politics

• On January 5, 2009, President-elect Barack Obama appointed Thomas J. Perrelli to the US Associate Attorney position. Perrelli represents the RIAA in many cases, including high profile bids to unmask file sharers without the terms of the judge reviewing the first evidence. Obama's Joe Biden's choice as vice president shows that the presidential candidate feels comfortable with someone with a rigorous pro-RIAA view. Biden urged criminal prosecution of peer-to-peer users who violated copyright and attempted to create a new federal crime involving unlicensed music playing.

In the video game

• In the video game industry, the music category goes beyond the sports category. 2 top categories in sales, behind the action. 58 percent of players play music games, second only 65 percent who play action games. About 50 percent play sports games, down from 55 percent in 2007 and 62 percent in 2005. The video game industry is worth $ 22 billion in 2008.
• Guitar Hero III: Legends of Rock , launched in 2007, has become the first single game to surpass $ 1 billion in sales. The announcement came during a CES speech by Activision Publishing CEO Mike Griffith and followed the announcement that all franchises had broken the same mark last year. Griffith says that Guitar Hero's monumental success has trickled into other industries, especially the struggling music industry.According to Griffith, the sales of all connected to Guitar Hero, from music to real guitar, has gone up.

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See also

• 2010 in the music industry
• Online music store comparison
• Portable media player comparison
• Digital Rights Management
• File Sharing
• List of portable media players with Wi-Fi connectivity
• Hard battles
• Music in the 2000s
• The music industry
• Online music store
• RIAA
• Satellite Radio
• User-generated content

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References

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External links

• Off Book: Evolution of Online Documentary Music produced by Off Book (web series)

Source of the article : Wikipedia