Today, the music industry is in the state of sophisticated and self-destructive chaos. The title of this article should portray the primary goal for all of those who are involved in music delivery. Fortunately, there is a method to polarize all and enter a bright and profitable future.
As soon as possible, just for the self-respect and fairness to music creators, we must switch our priorities from FREE or almost FREE delivery methods to normal monetization. Currently, the music industry would be lucky if global revenues exceed 18 billion in 2014. Since 1999 until today, and after just adjustment for inflation, the industry should be worth 56 billion dollars.
It’s a very shameful situation considering that the internet is the perfect marketplace for music.
Origin of Music Industry Meltdown
In reality, we have ONLY one fatal restriction holding us back from a profitable music industry: MUSIC DISCOVERY (totally free and available to all). In the era of internet, once you have a song’s name, you are AUTOMATICALLY THE OWNER at absolutely no charge.
As long as services like Shazam, Gracenote or Google lyrics ID keep delivering tune identification, we will not be able to implement minor changes on the Radio or streaming side of the business in order to monetize. The best we can do at this moment is to divert the individual with the song identification from a pirate site to YouTube, and hope for an advertising “jackpot” for every 100 to 200 songs being prostituted.
I hope someone can prepare a precise report on “music traffic” generated every day by all streamers, including YouTube, Pandora, XM, over 100,000 terrestrial Radio stations and music in offices, restaurants and other public places. My estimate of songs listened to across the globe each day is over 150 billion. Now, say we can monetize just one out of 200 tunes with a small fee for adding it to someone’s playlist (with ownership certification as a part of the deal), we would have a 100 billion dollar industry.
$75 million clicks a day, at 39 cents equals $106.76 billion per year!
There is room for $100 billion dollar industry at 1/3 of the current iTunes song price.
How and Where to Start
Our problem is not what we charge per tune to get our target. The main issue is when, and how, we can start a united effort to switch to Discovery Moment Monetization.
A change of the “fair use doctrine” would be the quickest remedy to force ID services to become profitable servants of the industry. Both EU and US are active in those matters and action from RIAA and labels could bring hope for an instantly brighter future.
This route will be strongly opposed by Google – intoxicated by advertising and devoted prophet of “internet freedom.”
Conversion to a system of profitable-for-all Discovery Moment Monetization through lobby efforts is easy and almost instant. If we cannot get there thru legal changes, we have to enlighten and disproportionally reward all discovery services with the new stream of profits.
Google, the most stubborn opponent of any ’fair use’ adjustments, is destine to control about 50% of the new industry. The current market positioning of this search giant, with YouTube as the best candidate for a new central hub of the new industry, should make them the most active promoter of Discovery Moment Monetization. (Global Patent Pending)
Let’s show Google that Pay Per Tune (PPT) will be ten times more frequent than the beloved PPC from the ad swarm around free.
