Can Crowdfunding Eventually Replace Record Labels? Or Can Labels Use This Tool Themselves?

Some people may or may not be aware of what crowdfunding actually is, in short it is the set of a project that asks for people to help fund in advance in exchange for some kind of reward. In music it can be the funding to record a new album in exchange for a pre order of release or more.This process is essentially cutting out the middle man of the record label and doing business straight between fan and artist, and this is an opportunity for fans to get closer to the artist, to actually feel like they are a part of the process.

Over the last few years this has been a process that has grown more popular, even with established acts like Ash joining in and having a campaign through PledgeMusic. What makes this approach different to the average pre-order option? you are still putting money up front and making a commitment to pay for something that is yet released. But the difference being you are committing to a project that may or may not happen depending if enough funds can be raised.

Screenshot of Jarrod Alonge’s campaign on Indiegogo

This does give the opportunity for artists to do some unique things with fans, of course there are the standard reward systems, a copy of the release physically or digitally, t-shirt bundles, gig bundles perhaps, but some campaigners have decided to do things like have option to party with the fans, have lunches, fans being in videos, have skype conversations. Jarrod Alonge even set up the option to literally walk a mile in someone elses shoes which at least 2 people out of 30 claimed for $75 towards his album recording fees. A bit silly bit a silly act that made him $150 none the less.

Skype Date and Walk A Mile In Your Shows reward options

This all sounds rather fun for artists and even fan, but where does this leave labels? The prospect of a band that can fund an album without having to give up a percentage per sold item to someone else is a definite incentive for any artist to go straight to crowdfunding instead of a label. You might argue that what about all the other stuff that labels can provide? All the P.R and marketing to maximise sales during release, the connections with studios and producers. Even the most DIY acts may find such things useful.

Well even some of the websites that deal with crowdfunding can help here, PledgeMusic is one of these. A crowdfunding website that is purely designed for music fans to help fund an artists release, they don’t take a cut in royalties but what they do take is a one off percentage cut from the funds made from the pledge campaign. Once the campaign has finished PledgeMusic has people that can advise on what to do next, what producers to use and more, essentially doing some of what a label can do without being a label, and what does happen is that the artist keeps all creative control, no restrictions from the label.

Screen shot of Ash’s simpler reward system on PledgeMusic

What can labels really learn from this? for the moment crowdfunding doesn’t look the threaten the majors like Warner or Universal but given time, bigger acts could just sense that they don’t need the big guys anymore. Imagine if Ed Sheeran gave the finger to Atlantic and decided to fund his next release from crowdfunding. Being one of the biggest acts in music at the moment he is definitely established enough to have a large backing from fans, and with a few releases under his belt already he would already have a few producers he could go to. Essentially he could could go completely DIY and still be very successful now that he has already made a name for himself.

Of course the main idea for artists to do this is pure creative control and a way to escape having the labels take away some royalties, though I can see a way that Labels can join in and capitalise from the use of this platform. Replacing the old way of recording advances and just having an album crowdfunded instead, potentially making a profit from the campaign, sell special “crowdfunded” editions as a unique selling point to hook the buyer amongst other things. Of course this is all speculation of “it coulds” and “it mights” but there is definitely a way for labels to adapt to this model.

It would be a great way for labels to take less of a risk on the less established artists on their roster. In the current way of doing things if the album is a flop and doesn’t really sell after it’s release? then they have failed and lost money, though if they get it crowdfunded, tough, the label has already take the customers money to fund the recording and hasn’t lost any of their own money in the process.

Taken from a blog post by B’as Kruijssen on the subject, he also agrees that labels should adapt, stating :

“I suggest another evolution for record labels. Label managers: feel free to embrace a crowdfunder instead of fearing it. Try keeping a close eye on crowdfunding sites; high quality music is all around. These bands and artists could be new signings in the future.. If you look at it that way, you can even say ‘artist happy, fan happy, crowd funder happy… and Record label happy’.

I see it as a great opportunity to take music business to a next level: if more good music is discovered, more people who love it will be touched by it. Which leads to more people wanting to Skype chat with a band, buy a signed guitar or pre order an album. Happy faces all around!”

Future labels should really take note, maybe the arrogance of the older labels will stare at it and say it won’t take off like they do with all new things “napster won’t change things” “Streaming won’t change anything”. But they would be fools not to look into this as an option.

What do you guys think? Can labels benefit from entering the world of crowfunding? or will crowdfunding be better off without labels interfering?

The Bas Kruijssen post can be found here

Could Apple Possibly Owning A Label Change The Face Of Streaming?

As some of you may be aware that there are rumours of Apple apparently to strike a deal with Big Machine, the record label that owns Taylor Swift. This sparked talk of potential exclusives of Taylor swift and other Big Machine to apple and their future streaming prospects.

It is quite safe to say that exclusives to one streaming site will force others to follow suit. Spotify, Pandora and Deezer will all be in the market to get exclusive artists to their site too. Exclusive is not a word I like, it means that you can only get it in once certain place, and usually you have to pay extra to get it. It is a clever but evil marketing system, Sky Tv have been the masters of that for years.

Battling for the rights of certain artists could be key to attaining customers and keeping old ones, Spotify losing Taylor Swift from their ranks would have been a huge blow, and if Apple do get the rights to her music that is a massive gain for them and would surely sway some people to want to use their streaming service. Even though this is a powerful tool in gaining customers, do Apple really need to do it?

Personal opinions of how much I hate Apple aside, you can’t deny their presence in the music industry based on their history of successful hardware and software. From reading an article by Josh Constine on Tech Crunch on the topic, he states that:t

“iTunes is said to have over 800 million credit cards on file and is available in nearly 150 countries. Compare that to the Spotify’s 15 million paying subscribers and roughly 60 countries of operation

Then there’s those 1 billion iOS devices sold. If iTunes’ streaming app comes pre-installed in the next generation of iPhones and iPads, it could leapfrog Spotify’s user base over night..” 

Numbers really speak for themselves, there is a far superior number of Apple loyalist to how many people use Spotify, that is quite a daunting figure for Daniel Ek (owner of Spotify) to look at I would imagine. In reality it is Ek who would likely need to secure exclusives to Spotify to keep up with Apple’s streaming service. As Constine also states, Apple may be late to the party where streaming is concerned, but their usual MO is to enter it with superior fire-power like they did in the phone market.With the potential exclusive artists and the apparent price plan at $7.99 a month which undercuts Spotify’s $9.99, Apple already look like they will steamroll the streaming market.

How does this affect customers? We won’t know until it happens but from clear speculation I expect chart names to be the types of acts that services would try to get to sway customers minds towards them. Bigger names will be the targets, your Sam Smiths and One Directions. Customers will then have to decide if they can afford multiple services or choose a priority one based on their music preference. I personally listen to acts on Spotify that aren’t exactly in the limelight, no major labels, these are the sort of acts i expect to be on several services and I doubt there will be streaming sites that will want their exclusive rights. Assuming that will be the case then if all I want is on Spotify I wouldn’t need to use Apple’s service, though if they start buying up the rights to someone’s favourite artists and it is no longer on Spotify, they are likely to switch over.

What do you think? Will apple dominate the streaming world?

here you can find the article I read

http://techcrunch.com/2015/02/08/exclusive-streaming/

What Really Is “The Internet of Things”? And is it a good thing?

Recently I was introduced to the term “The Internet of Things”, which seems like a fancy way of saying technology is getting smarter than we think.

It is the idea of more things in the house connected to the the internet, like a heating system that detects your phone is within a certain radius and turns on for you so your house is already warm when you get in, that sounds incredibly clever. That is just one of thousands of uses and the number of technology devices that are designed for this kind convenience is heavily growing, sounds cool right?

It does to some extent, the lazy person in me likes the idea of my house doing something for me so I don’t have to, or at least don’t have to wait for something, I like that kind of convenience. There are ideas of watches that can detect health issues in you so they can book doctors appointments for you, fridges that detect when it is getting less full and orders new food to be delivered to restock. Little lifestyle changes like that would make life so much easier for a lot of people. It almost sounds a little too good to be true.

Being a sci-fi fan, this makes me both excited and sceptical at the same time, it is great that the human race has become technologically advanced enough to be able to do such things, but should we? All of these things point to one day that the majority of society will have smart homes full of these devices. Though will we become too reliant on these devices? Should we take fictional stories like Wall-E as a warning that these devices will just make us an even lazier society? and a smart home just makes me think of HAL 9000 or Skynet, I personally fear the day that technology becomes self aware.

Back to more sensible thoughts, all of this seems possible because of the term If This Then That, IFTTT for short. Basically a way of saying if this happens then that will happen, and building that into technology. Like the way I described the heater system, if the phone comes within a certain radius then the heater system will turn on. Building technology around this philosophy does seem like a fantastic way to help technology evolve

I’m intrigued about how the music industry will fit in with this, in the future will iTunes or Spotify be built into the house and come on automatically as it detects you entering the house? Will they be able to know what you have been listening to before you entered the house and continue playing it over the speakers within the house? will your use of Spotify be a way of helping you be alerted when you favourite artists come fairly local to you?

The possibilities do seem to go on and thing for people to keep an eye on

Is The Social Media Phase Ending? Or Are People Jumping To Conclusions

After reading what Fred Wilson had to say about what has happened to in 2014 in the social media and technology world, I can’t help thinking he is wrong in some aspects, or he has some wishful thinking, I will show you some of what he has to say, along with my response on it.

1/ the social media phase of the Internet ended. this may have happened a few years ago actually but i felt it strongly this year. entrepreneurs and developers still build social applications. we still use them. but there isn’t much innovation here anymore. the big platforms are mature. their place is secure.

Now this I strongly disagree, even though people come and go from it and slate certain aspects of social media, it is still going very strong, and still one of the most convenient ways to keep in touch with people and certain information.

2/ messaging is the new social media. this may be part of what is going on in 1/. families use whatsapp groups instead of facebook. kids use snapchat instead of instagram. facebook’s acquisition of whatsapp in february of this year was the transaction that defined this trend.

Again I disagree, most of this is not “instead of”, it is “as well as”. Most of the same people who use one, use all the others too, they are all just more options

8/ we finally got rid of files. dropbox, google drive, soundcloud, spotify, netflix, hbogo, youtube, wattpad, kindle, and a host of other cloud based services finally killed off three letter filenames like mp3, mov, doc and xls. spending a week in the caribbean with young adults and bad internet was the tell on this one for me. they don’t even have mp3s on their iphones anymore!

Surely this is based on personal preference, some people find may find it more convenient streaming or storing things on the internet, but no, the file is not dead as long as the file still has use. People still have vast music collections over the years that they have stored on computers and backed up on hard drives, that will not stop and it will continue to grow. Students will back up their work, again storing it on computers, multiple hard drives and possibly the cloud out of paranoia of losing their work. For now these are all still just options, not a definite way of doing things.

I can’t help thinking that what Wilson has said is more of a wishful future prediction than what is happening, I can’t see social media ever dying out, not completely, it will just adapt to society. It has become too big for it to now just go. Platforms will go, something else will just replace it, Myspace was so 10 years ago, Bebo came along for a short while, Facebook has being going fairly strong for years, same with Twitter, Instagram and Tumblr are kind of outsiders, but they all link in with each other in some format, you take a picture on Instagram and share it to the world of Facebook, Tumblr and Twitter. All of them have millions of users every day, does that seem like the end of social media to you?

The “in” way people will contact each other will continue to change like it always has. Phoning, to texting, to instant messengers and Skyping, to snapping. Note that these are still options, it’s just that snapping seems to have been the big phase over the last couple of years. People have already gotten bored with that while others still love it, just like most forms of social media, something else will come along at some point for people to fuss over. though the other options will stick around.

File owning won’t die yet either, this current generation still strongly uses them. For example I use Spotify but I will always prefer to have a copy of music to stick on to a portable MP3 player. Until there is a more practical way for me to stream on the go, I will continue to use an MP3 player. And I’m sure other people are the same with their iPods and MP3 players. It won’t be too long though before there are better options to streaming on the go and at home, and more benefits to cloud based websites, the next generation is more likely to be the ones that don’t use files, because they never will do.

Here is the rest of what Fred Wilson had to say

Will YouTube Have To Change To Suit The Needs Of The Music Industry?

After reading Mark Mulligan’s blog post about how YouTube should change to be more like a radio station, it makes me wonder, is that easier said than done?

Claiming that YouTube is a key platform of music discovery for the modern generation, in the same way that our parents and grandparents used the radio to discover new music. The difference being there is more freedom with YouTube to choose what you want to listen to. I completely agree, at college I would have a YouTube channel on in the background as I’d do my work and I found it to be a great way to learn about new bands in my specific niche, though I find it just as easy to do that with Spotify radio too.

Mulligan feels that YouTube shouldn’t allow music videos to be free on demand. Again I agree to some extent, people have access to so much music for free on YouTube that they take for granted, I certainly do, and there are people I know that would search YouTube all day just looking at videos wasting their day away.

On a practical level taking away this free option of free music would cause a massive uproar and I think it would have damaging effects on musicians lower down on the totem pole of the industry, or should I say the alternative niches that don’t get a lot of mainstream view compared to your Ed Sheerans and Taylor Swifts

I feel that removing a free-tier to YouTube music only benefits the acts that are already well established, and if they or their label doesn’t think it is fair their music is available on YouTube for free then they need to deal with it without affecting less established acts. An Ideal world would be that only some channels charge and others are free to view, Like a Sky TV package, some channels you don’t have to pay extra for, some you have to pay an added monthly premium. Or better yet as Mulligan mentioned, have a PAYG system.

Though if YouTube went this way with music, what about other content? there are whole films available, documentaries, DVD footage, football highlights, content that isn’t exactly sanctioned officially but it is still up there, If labels and bands in the music industry start charging, do film and TV studios start too? I definitely see that if the music industry starts to clamp down on YouTube, a chain reaction will follow within of areas of the media.

You can find Mulligans post here

Is This The Death Of Piracy And The Rise Of Streaming Through Its Ashes?

After what looks like the death of Pirate Bay, EZTV and other torrent sites this month due to police raids on servers, a huge question remains on, what is the future of Piracy?  Pirate bay seemed to be the most popular torrent site going, anyone could use it, and you don’t have to sign up or keep control of your seeds to keep using it, nice and easy, you can come and go when you want, well not anymore.

Industry heads in all areas of media would say good riddance, whereas freeloaders are weeping somewhere looking for the next best torrent site to pilfer from. Will this lead to a chain reaction of more sites to follow? or was Pirate Bay being arguably the biggest just and easier way for it to be tracked down?

Data shows that since the rise streaming sites, the most popular at the moment being Spotify, the numbers in piracy have dropped quite severely…. Why is this? Easier access to music and it being much easier to use could be a huge factor. A bigger one is that you can use it for free if you wish, a gigantic library at your fingertips to listen to for free if you don’t mind adverts every few songs. Spotify has almost everything that people want in their vast library (…..as long as you don’t want Taylor Swift). We have become a lazier generation, I for one have reduced the amount of downloading I do and use Spotify instead, I even listen to music that I own already through it because it is easier to play almost everything through one platform.

Marc Geiger claims that Streaming is the future of this industry, I highly agree and I think with the highly anticipated Apple iTunes and Beats merge soon to be released, streaming will boom even more through Apple loyalists, no doubt that iTunes is one of the biggest music providers, now imagine if the majority of its customers converted to streaming. It is a very exciting concept, and I’m highly intrigued to how it will all pan out.

I am not an Apple fan, I don’t like their capitalist ways in trying to squeeze as much money out of people as they can. I Also  think iTunes is one of the least user friends programs going, but I cannot help wanting to see what the new streaming model will look like, how big it’s library is, how it is compatible with iTunes. And what about portability? Spotify has an app, I’m assuming iPhone’s will have one, but will Apple release a new iPod with the ability to stream?

This leads to more questions. Most people download music so they can own it, so they can put on a device to listen to as they go, whether it is an iPod/Mp3 player or a phone, whatever….Will people still need to download legally or illegally if streaming becomes more accessible on the move? will newer devices be made to cater for streamers? As much as I like the idea of streaming on the go, my phone battery won’t hack it with all the other things I use it for, practicality needs to come into the equation too.

As cynical as this sounds, you can be vigilant all you want with piracy, the only way to completely stop it is to shut down the internet, that isn’t going to happen. When wildly popular sites like Pirate Bay go down the traffic of piracy will drop a little until the next best thing is available. Currently proxy sites are handy for the freeloaders to use to avoid site blocks from such providers like Sky. As a music enthusiast, I’d love to see streaming dominate and for music to be available at fairer prices for customers to access it. The simple thing is that free is everyone’s favourite price, if you can get it for free then why pay for it?

What do you think? Will piracy die out if streaming does start to dominate the music industry?