Is the music industry… dead? This question comes up too often and usually involves a mention of how piracy has damaged the market so badly. So what’s going on?

There is a very simple answer for this. Let me help you break it down.


The music industry is reliant on, you guessed it…


To play music, the consumer has traditionally purchased an album, along with a form of technology to play the album. After the “digital invasion”, consumers realized that digital files would last forever, whereas cassette tapes wore down, CD’s melted in the car, and so on. We started backing up our cd’s and burning copies for friends. We were sharing… and in a similar way to recording a mixtape for a pretty girl.

After the iPod and iTunes hit the market, we started realizing how easy it was to store massive amounts of music. Besides the nostalgia, physical media has lost its value. The latest generations don’t value the CD like previous generations. We have slowly traded the smell of a new album for the convenience of digital media and mobile devices.

And let this serve as a reality check, the music itself even suffered a drastic loss of quality in order to fit into small spaces, as well as to help sell mobile devices. i.e. “Stores X amount of songs on one device!” Don’t underestimate the industry’s reliance on the consumer’s desires.

We now have streaming services that SHOULD be the answer to our digital prayers. But we also have youtube and VEVO who both allow us to play music for free from any computer. Now, why would anybody want to pay for something that they have free access too?


What’s missing? What does the consumer need that we don’t yet have?


If we want to play music from a mobile device, we have to either import the music directly to a mobile device, be within wifi range, or drain the battery streaming to a smartphone.

Quite simply, we don’t have the…


to provide an efficient streaming service outside of the home.

Why would I, as a consumer, want to pay for a streaming service that is really only useful from home, where I have free access to the music anyways? There needs to be some worthy benefits, and those benefits are going to narrow the market down dramatically, likely to music creators and enthusiasts. This is where we are at right now. The general public doesn’t care to spend the money because there is no service that fills their needs.

So let’s simplify this. What does the general public want?

Access to a massive library from anywhere at anytime, with absolute control to their listening.

The problem is that our mobile networks are not able to provide us with the reliable connection for companies to deliver this service. It doesn’t fully exist yet. But we’re getting there.

I feel like I’m being redundant here, but the fact that most everyone still operates in fear of a dying industry shows us that we generally don’t understand this concept

So, to answer the question…

“is the music industry dead?”.

That would be a powerful NO! The music industry is NOT dead. In fact it is very much alive and bigger than ever before. It’s reassembling and with more power and more influence in the hands of the people. What we are experiencing is a transitional period where technologies are in development, and the business is reliant on the completion of those technologies to flourish. This is part of a cycle that has been going on for years. New ways to provide a service more efficiently.


Now, what we end up with is a new form of revenue for market share.

Consumers can access music from…

Physical Albums, Radio, Digital Downloads, Sharing, Mass Sharing, Social Streaming, and Streaming Services.

Physical albums are what we’ve really had a hard time letting go of. I love the smell of a freshly printed album. It costs the most money to distribute though. Eventually, it is likely that the market for this form of merchandise will primarily consist of enthusiasts.

Radio is a free service sacrificing consumer control for advertisements. It has its place so far and has held on well considering. But radio’s biggest enemy, streaming, has yet to develop. But perhaps it isn’t quite the enemy we think it to be. Streaming will likely “change” radio forever. We have podcasting now, which is pretty much a talk radio show on demand, and will likely replace radio in the future and to be dished out within On Demand streaming services. The radio shows aren’t going anywhere though. In fact, the shows are going to have more power in their hands. that’s not to say it won’t get more competitive though. You still have to have a good show.

Digital downloads from services like iTunes, Amazon etc., which take time and storage space, are an interesting threat to the streaming services, artists, and producers who would rather see you not own your media, but instead have access to it, a license to play it. This cuts down the market share for piracy and maximizes the revenue that can be generated from each song. Why make $1 and be done when you can make $0.01 per play? Expect to see digital downloads being discouraged.

Piracy (or Mass Peer-to-peer Sharing) relies on uploaders, time, storage space, and this market is primarily going to consist of low income households (including 3rd world countries), piracy enthusiasts, and computer geeks. The actual damage that is and will be caused by piracy is not known and remains debatable, but with an affordable streaming service, piracy is likely to be minimized.

Social streaming services like Youtube and VEVO allow for monetization based on traffic. This is where your music videos will gain popularity. It’s good advertisement for an artist and can do more than pay for itself with monetization based on traffic, and also by generating inbound marketing traffic. Expect these services to continue to crack down on illegal uploads of Intellectual Property (IP).

Streaming On Demand allows the consumer complete and instant access to massive music libraries. This is the mother of all digital distribution. A heavenly cloud where we all gather to enjoy digital media, to share it, debate it, support it… But to clarify, streaming is the new service that is still in development. It hasn’t fully arrived yet. When it does, expect it to eventually have the largest market share. Probably well over 50%.

As for the exact business model, I would expect there to be a variety of flavors, at least one of them to be something similar to the successful mobile games which would give the consumer the option of dealing with advertisements, or paying monthly for the service, advertisement free. I would also expect social media and social funding integration where you can support your favorite artists in multiple ways, connect with them on their own private channel, make your own channels, playlists, and so on. This service is all about cost vs control and social integration. I am excited for it. Independent music, radio shows or “PODcasts” will finally have a home. Musicians will rejoice with opportunity with a clear and achievable goal in site. Music will bring us together. Harmony restored.


A quick recap: Remember this. Music is reliant on the consumer. The consumer is reliant on technology. Technology is in a transitional phase and will take some time before the consumer can get what they want. And we’re almost there.


That’s it.


Thanks for joining me. I hope this opens up the view of the future… for everyone in doubt.


Remember to “Dream Big. Keep it real. And make it happen.”

I’m Adam Spade

Ta ta