A little over 10 years ago, the music industry had a major revolution. Just as album sales were drastically sliding down, and music piracy was causing panic amongst major labels and music business insiders, the MP3 Player was released to the market. Most notable was Apple’s iPod, which eventually became the leader among all MP3 players. It became a device that everyone had, or a device that everyone HAD to have. Among youth, NOT having an iPod was a sign of being outdated or out of touch with current pop culture. But times have changed. Technology eventually led the cellular phone market to it’s own revolution over the last couple of years. Not just a standard cell phone, nor a traditional rotary phone (although that would be way cool!). These are phones with numerous additional features. Features where the biggest draw for consumers is usually NOT how clear you hear someone during a call. Most notable a device where you could store or playback music…some where you could even record music. These phones are better known as “smartphones.” Apple released the iPhone, the market leader. Google released the Android. Even Microsoft has a Windows phone. Smartphones took the place of portable MP3 players for the most part when it came to personal music playback. There will still be a place for MP3 players among fitness enthusiasts, but majority of music consumers, as well as casual music listeners, choose to fill their smart phones with music over using a straight MP3 player. According to Billboard.biz, “Today’s smartphones do everything an MP3 player can do, plus make calls, schedule appointments, take pictures and browse the Internet.” Music consumer not only find convenience in a smartphone, but also a sort of sexiness to them as well.
At first, music industry vets might shriek at this thought of MP3 player sales decreasing. This would cause panic. My first thought was, WOW sales are getting so low that people will not even want to purchase music anymore because they won’t own MP3 players to playback music! UK reported a 22% decrease in sales over the last year. The prediction is that there will be over a 50% drop in sales over the next 4 years. Possibly more! But there is actually good news hidden under this! With the marked decrease in sales of iPod/MP3 players, the increase in sales of smartphones is actual creating a new source of revenue for the music industry. A new way of data (or music, for sake of this article) storage. This is leading to more development and investments toward new media. Where the music industry can benefit, is that smartphones act as sort of an entry way to current and future subscription based music services. This will also encourage people to adopt cloud-based storage units for their music collections, which in turn will change how music fans will purchase everything from their music, to tickets for concerts and artist/band merch. This will create revenue for music asset holders and artists through subscription services because of the premium placed on mobile devices.
Mobile phones are such an essential part of pretty much everyone’s lives. The development and investment toward music services that enable more and more smartphone’s to allow users to store and playback their music, is also helping to keep the music industry alive. More and more everyday we see that the music business is really alive and well. Actually growing! Just not in the traditional way that many of us have grown up with. We do not necessarily know where it is all headed, but we do know it is going somewhere. I can say with confidence that wherever we end up is going to be a much more fruitful and artist friendly world.
Image from Billboard.biz