FuturistGerd.com
@gleonhard

A futuristic outlook on the creator,
consumer & the business in between
Most of what I am about to share
with you is actually good news…

Photo by Dr Case - http://flic.kr/p/5fiGgf

Photo by Micha...
Music: is Sweden (and Scandinavia) showing us the future?
E-M-P-O-W-E-R-M-E-N-T
Digitization

☯

Music Creators
@gleonhard

Global Transformation driven by Digitization:
When Products become Services and Experiences, the creator becom...
All media is shifting from protection to engagement

Photo by WallStreet Journal.com
Maybe this is a
good time to…

rights licensing
across Europe?

@gleonhard
Disembodiment
of Media

@gleonhard
The rapid disembodiment of music will force
us to create a collective, EU-wide solution
Copying ☯

Listening

@gleonhard
… the incarnation of this trend: mobile!
Value Axis

The inevitable result of digitization: lower per-unit revenues

- Offensive Innovation is crucial Potential ‘D...
Music is not unique in this: massive consumer
empowerment’s inevitable consequence is price reduction

@gleonhard
As distribution becomes abundant, new things become scarce
Abundance of
ways to ‘get music’

New
Scarcities:
Attention
Bra...
The Music Industry Curse: Ego

Photo by Homies In Heaven - http://flic.kr/p/d6Ff2C
Industrial & Mechanical ☯ Digital & Exponential
Controlling Distribution ☯ Monetizing Attention
Largely monopolistic EGOsy...
“The greatest danger in times of turbulence is not the
turbulence, itself, but to act with yesterday’s logic”

*Peter Druc...
Many new value generatives i.e. a ‘Royal Family’

http://www.zimbio.com/pictures/APDwKZ3i-RJ/Nobel+Prize+Award+Ceremony+20...
Digital Money is a certain future: not if butabout where…WHO
No longer about distribution but when, attention
In large, hardwaredominated markets
(US, UK, Germany
etc), ‘fake
ownership’ of
music used to
work - but fast
decline is ce...
There is no long-term mass market for digital single downloads but mobile music and download-HD-to-keep as a premium produ...
Fake Scarcity is misleading both the artists and the consumers
Managed dissatisfaction is not a sustainable business model
*Reed Hastings, Netflix

http://evolver.fm/2013/07/23/paid-musi...
43 Million subscribers in 23 countries: be irresistible!
Distribution as a key revenue driver or as
competitive advantage is a ‘burning platform’

Image of BP platform via US Coas...
Distribution as a key revenue driver or as
Brand & Audience is a ‘burning platform’
competitive advantage

Image of BP pla...
I am happy to pay cash (or data i.e. attention) for highly personalized,
timely, social, meaningful, relevant, high-resolu...
The message is clear: consumers want cheap, bundled or ‘feels
like free’ access first, and will only then consider going fu...
RYTHING
ATS EVE
EE BE

FR

UTION IS
DISTRIB
OLLING
CONTR
SENTIAL
ES

EVANCE
ST-REL
LUE-TRU
VA
ERVICE
TEXT-S
CON

EPING
AND...
The ‘forced evolution’ of music

Sell
copies

Sell
Premiums
License

Access
Yes, we already have a model for this
but the legal structure of music commerce must be transformed urgently
A €10 Billion recorded music market in Europe?
1€ per Internet user in Europe / month for basic streaming & offline service...
Music is indispensable to the next generation media powerhouses

…and these
guys already
see music as
disembodied,
mobile,...
Can Europe create
a new digital
music Ecosystem?
Music industry reset: think ‘Biosphere’ not ‘Myosphere’
COLLABORATE
- NOW OR GET
SQUASHED BY
FAST INNOVATORS
We are
at a
pivotal
point
The CD (physical media) is quickly disappearing in the rearview mirror: (em)brace
‘Managed dissatisfaction’ (such as iTune...
Thanks for your time and attention...
Now, let’s talk!
The future of music: creators, consumers, and the in-betweens (aka industry)
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The future of music: creators, consumers, and the in-betweens (aka industry)

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This is a version of the slides I presented at a talk I at the SKAP / DFAM event in Stockholm, Nov 28, 2013 see http://www.futuristgerd.com/2013/11/28/my-presentation-at-dafm-skap-event-in-stockholm-today-pdf-a-futuristic-outlook-on-the-creator-consumer-the-business-in-between/

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The future of music: creators, consumers, and the in-betweens (aka industry)

  1. 1. FuturistGerd.com @gleonhard A futuristic outlook on the creator, consumer & the business in between
  2. 2. Most of what I am about to share with you is actually good news… Photo by Dr Case - http://flic.kr/p/5fiGgf Photo by Michael Cordedda - http://flic.kr/p/9cDmTe
  3. 3. Music: is Sweden (and Scandinavia) showing us the future?
  4. 4. E-M-P-O-W-E-R-M-E-N-T
  5. 5. Digitization ☯ Music Creators
  6. 6. @gleonhard Global Transformation driven by Digitization: When Products become Services and Experiences, the creator becomes even more crucial Product Service Experience
  7. 7. All media is shifting from protection to engagement Photo by WallStreet Journal.com
  8. 8. Maybe this is a good time to… rights licensing across Europe? @gleonhard
  9. 9. Disembodiment of Media @gleonhard
  10. 10. The rapid disembodiment of music will force us to create a collective, EU-wide solution
  11. 11. Copying ☯ Listening @gleonhard
  12. 12. … the incarnation of this trend: mobile!
  13. 13. Value Axis The inevitable result of digitization: lower per-unit revenues - Offensive Innovation is crucial Potential ‘Digital Audience’ Revenue per 'Unit' 100 75 50 CD & Vinyl iTunes 25 Spotify 0 Pandora Youtube* @gleonhard
  14. 14. Music is not unique in this: massive consumer empowerment’s inevitable consequence is price reduction @gleonhard
  15. 15. As distribution becomes abundant, new things become scarce Abundance of ways to ‘get music’ New Scarcities: Attention Brand Relevance Context Timeliness Embodiment…
  16. 16. The Music Industry Curse: Ego Photo by Homies In Heaven - http://flic.kr/p/d6Ff2C
  17. 17. Industrial & Mechanical ☯ Digital & Exponential Controlling Distribution ☯ Monetizing Attention Largely monopolistic EGOsystems ☯ Collective ECOsystems
  18. 18. “The greatest danger in times of turbulence is not the turbulence, itself, but to act with yesterday’s logic” *Peter Drucker http://bostinno.streetwise.co/2012/08/27/pirating-music-kill-a-horse-instead-7-crimes-not-as-bad-as-illegally-downloading-music/
  19. 19. Many new value generatives i.e. a ‘Royal Family’ http://www.zimbio.com/pictures/APDwKZ3i-RJ/Nobel+Prize+Award+Ceremony+2008/8XVWQBpueY7/King+Carl+Gustaf+XVI
  20. 20. Digital Money is a certain future: not if butabout where…WHO No longer about distribution but when, attention
  21. 21. In large, hardwaredominated markets (US, UK, Germany etc), ‘fake ownership’ of music used to work - but fast decline is certain!
  22. 22. There is no long-term mass market for digital single downloads but mobile music and download-HD-to-keep as a premium product has great potential !
  23. 23. Fake Scarcity is misleading both the artists and the consumers
  24. 24. Managed dissatisfaction is not a sustainable business model *Reed Hastings, Netflix http://evolver.fm/2013/07/23/paid-music-downloads-are-declining-but-why/ $ $ “Managed Dissatisfaction ” Image via Popsci.com
  25. 25. 43 Million subscribers in 23 countries: be irresistible!
  26. 26. Distribution as a key revenue driver or as competitive advantage is a ‘burning platform’ Image of BP platform via US Coast Guard
  27. 27. Distribution as a key revenue driver or as Brand & Audience is a ‘burning platform’ competitive advantage Image of BP platform via US Coast Guard
  28. 28. I am happy to pay cash (or data i.e. attention) for highly personalized, timely, social, meaningful, relevant, high-resolution content but it must be on 100% irresistible terms: simple, easy, fair
  29. 29. The message is clear: consumers want cheap, bundled or ‘feels like free’ access first, and will only then consider going further 2010 http://musicbusinessresearch.wordpress.com/2013/10/18/is-streaming-the-next-big-thing-what-consumers-want/
  30. 30. RYTHING ATS EVE EE BE FR UTION IS DISTRIB OLLING CONTR SENTIAL ES EVANCE ST-REL LUE-TRU VA ERVICE TEXT-S CON EPING AND KE RNING EA ENTIAL IS ESS NTION ATTE
  31. 31. The ‘forced evolution’ of music Sell copies Sell Premiums License Access
  32. 32. Yes, we already have a model for this but the legal structure of music commerce must be transformed urgently
  33. 33. A €10 Billion recorded music market in Europe? 1€ per Internet user in Europe / month for basic streaming & offline service Approx. 600 Million Internet users in Europe x 12 = 7.2 Billion per year This would be 40% of current global recorded music earnings in 2012 The 1 € could easily be paid for by telcos / ISPs / portals (advertising) Up-selling to 10+ premiums could yield another 30-50% revenues Add another 400 Million mobile phone users…
  34. 34. Music is indispensable to the next generation media powerhouses …and these guys already see music as disembodied, mobile, cloudbased ‘added value’ …+++
  35. 35. Can Europe create a new digital music Ecosystem?
  36. 36. Music industry reset: think ‘Biosphere’ not ‘Myosphere’
  37. 37. COLLABORATE - NOW OR GET SQUASHED BY FAST INNOVATORS
  38. 38. We are at a pivotal point
  39. 39. The CD (physical media) is quickly disappearing in the rearview mirror: (em)brace ‘Managed dissatisfaction’ (such as iTunes) won’t make the pie bigger Beyond a doubt, streaming and ‘access’ is the new ownership: new laws needed! ‘Access’ may result in a 90% reduced ‘unit price’ but has x1000 audience We need digital music licenses that enable Billions of users to contribute $€£ Many new premiums can be offered on-top of ‘feels-like-free access’ The new (old:) ‘embodiment’ of music is the artist and the brand, themselves Social media, video, mobile (SoViMo) are huge opportunities: get engaged! In the EU, we need offensive innovation, real leadership and hyper-collaboration
  40. 40. Thanks for your time and attention... Now, let’s talk!

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