September 27, 2010 The Stream that Snuck up on You
Have you noticed that you’re streaming more audio and video? That your purchase of CDs and DVDs has dramatically decreased? That your DVD cabinet and CD racks have a layer of dust on them (literally, or otherwise)? That your digital CD/DVD cabinet (i.e. iTunes) is being opened less frequently? (Apple knows this, by the way, it’s why the new AppleTV has no hard-drive; it’s all streaming…really think they’re not going to do the same for music?)
We’ve started up the Kurzweil Curve with respect to streaming, and it’s only going to accelerate from here.
The interesting thing is that, because the transition has been relatively gradual, you probably haven’t noticed that this radical behavioral and technological change has occurred. You haven’t noticed because it hasn’t hurt; in fact it’s felt good.
There are opportunities here. For content creators, the sooner you reconcile the fact most people aren’t likely going to want to own a digital copy of your music/movie/tv show/book (let alone a CD, etc.), the sooner you can devise profitable streaming models.
By the way, the rise in vinyl consumption has an inverse relationship to the ownership of other types of musical content. That is, even as we own less digital copies and CDs, we will own more vinyl. This is NOT because of the better sound quality of vinyl, it’s because vinyl is a great example of a “social object” (ala what I referenced in a recent post on marketing and fruit). We want to share, hold, display, and talk about vinyl.
This post originally appeared on George Howard’s blog, 9GiantSteps.
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Vinyl, streaming, technological change
Reader Comments (6)
The rise of streaming is something I often bring up when people talk to me about my plans for future revenue & why things look down to me right now (we all know that currently for all intents & purposes streaming does not pay). Even the idea of getting money from tv/film looks like it will go down the tubes if streaming isn't properly "monetized" in fairly short order.
While I do agree that the rise in vinyl (& cassettes) has to do with the physical object aspect & there are some labels doing CDs with a similar appeal (like Shane Sauer's North Pole Records with all letterpress digipaks), in the end I do think it's a bit of a fad. If having a record becomes the equivalent of a poster, how many poster's do most people have up after college? Or I suppose it's more like band t-shirts where after a certain age most people only where them to do yard work....
I have to agree whole heartedly. Since I purchased an iPhone 4 a few months ago, with a faster chip and better 3G performance than my earlier mobile, I am listening to more music than I have in years between MOG and Pandora.
This is saying something. I'm a musician, an educator, and an audio professional with over a decade in the recording business. In short, my life was ALREADY surrounded by music. I used to be a CD junkie and my vinyl collection spans multiple walls in my home and office. But within the last few months, that has started to slowly change. And I won't look back. This morning alone, I've checked out new releases from Neil Young, the Roots, Maroon 5, Robyn, and Eric Clapton. The process was thrilling and creatively inspiring. And it only costs a few dollars a month.
While I know many are decrying the relatively paltry royalties coming in from streaming services, I have to be an optimist and think that this access to art, song, and culture will ultimately be beneficial not only for music fans (and society), but eventually our industry as well.
I couldn't agree more with all this. I did, however, have a few defining moments earlier this year that lead me down the streaming path.
I first dabbed in a paid streaming service (although I'd tried Spotify a few times while traveling overseas) back at the top of the year when I signed up for Mog. I only used it a few times here or there but began to pick up on the habit more after wanting to hear some Big Star upon the sad passing of Alex C. back in March. I could have dug through a hard drive to find my Big Star folder, but instead went to Mog and dialed up the "Big Star" channel and had hours of listening enjoyment and memories right at my fingertips. From then on, I was hooked...
My second turning point came more recently. After switching over to Rdio (which I adore), I found myself actually forgoing spending money on a single release and opting to just grab it off rdio instead. I had streamed on NPR the new Ray LaMontagne album a week before it's release and really enjoyed it, so when I saw it was only $3.99 on amazon.com the day it came out, I was all set to buy it, but since I was on vacation in northern MN and thus didn't have the best internet connection, I was a bit hesitant to give it a go...then I remembered to look on Rdio and sure enough, there it was...and within seconds I had it in my collection online and then also on my iPhone (in MP3 form for when I'm offline).
I've repeated this process numerous times (including this past week with Neil Young's wonderful new album)...and I don't see myself turning back at this point.
So, from an economic POV, I went from spending $12-15 on a CD 15 years ago, to spending $10 or less for a digital copy, to foregoing a cheap $3.99 download to rolling all my spending into an all inclusive subscription streaming option for $9.99 per month.
Do the math, that's a tremendous amount of money saved by me as a music fan, but a lot of income and earnings lost by the creators and owners of each individual album.
Back to the drawing board for us creative types me thinks...
This has been a long time coming and I for one was someone shouting about it for years. But all is not lost. Once you accept that streaming is de rigeur the next thing is to create streaming solutions that will make money and there is only ONE. Video. Online video spend is going up and up and up and it works in driving traffic. Get people to your site and let them pay for interactivity or use the age old and tried and tested formula of appealing to their greed and use a comp. Anyone else with other ideas ?
Well, here's an idea. Given that you have enough content to create some streams on your own site, you can try ad revenues. However, I run a webzine ( www.silbermedia.com/qrd ) & I have to say ads are hard to come by lately. If you look at most music websites you can find that ads are harder to come by as more & more places are using Google ads or iTune links with kickbacks instead of having direct ads for bands/labels. But maybe at a certain point having donation boxes & offering well placed ads either as visuals or audios could work. Obviously if I actually knew what would work I'd be doing it....
Seriously great post George. I've totally ignored this fact altogether but yeah, that does seem to be the things are going.