Excellent Post on: Transmedia in the Music Industry | Grazie! Transmedia Lab

Grazie to Transmedia Lab for a great informative post:

Par Ana Vasile et Olivier Godest • 12 May, 2011 • Catégorie: Study Case

"Faced with the evolution of uses and new media consumption habits, the music industry has to face similar problems to those seen in the audiovisual industry: unstable audiences, growing competition and pirating. However, new economic models and multiplatform projects are emerging: Jay Z, Gorillaz or Nine Inch Nails for example, are reinforcing their relationships with their audiences through storytelling.

New distribution models

The authors of record labels are faced with one main problem these days: the decreasing sales of material media (CD, DVD), which is directly linked to the digital explosion.

Even though it’s often brought up as producers’ number one fear, music only represents 2,9% of illegal downloads, as shown in this Ars Technica study. While most big producers are concentrating their efforts on fighting pirating with entities like the BPI in the UK, the Hadopi law in France or the RIAA in the US, new music development actors and economic development models are changing the playing field.

For example Spotify is a free music access provider that had 10 000 000 users last year with a service financed by advertizing. Since May 1st, Spotify’s policy has changed under pressure from record labels.

New Spotify Users will still be able to enjoy free service as it is offered now for the next 6 months. Afterwards, all the users of the free service will be able to listen to a song a maximum of 5 times, after this limit, the user will have to buy the song.

The number of listening hours will also be limited to 10 hours a month, a 50% decrease from last year. Spotify had to change its free policy under pressure from record producers who were denouncing an economic model that caused them losses. For example, Lemonde.fr criticized streaming based models by analyzing the distribution of money that comes from them and highlighting the fact that they hurt independent labels and artists..."

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Fascinating: Here's Spotify's Master Plan: Tackle iTunes Head-On - Excerpt from BusinessWeek

A couple of weeks ago Spotify, the European music streaming startup, came in for sharp criticism when it made the decision to place tight limits on the music you could listen to for free. It made financial sense, but left us wondering where its strategy was going.

On May 4 it revealed the next piece in the puzzle, and it's a bold move: a new version that makes it—for music, at least—a direct competitor to Apple's (AAPL) iTunes.

What do you get from the new, improved app?

Management and synchronization: Until now, Spotify users (like me) conducted their desktop listening through the app, but still had to juggle the music on their iPods through iTunes. No more. The new client allows you to manage music on an iPod. The system also works for Android.

Download service: Spotify has offered you the chance to purchase tracks for quite a while, but it was a piecemeal, white-label service where users could only buy a single track at a time. Now there's a more straightforward shopping system, which allows people to purchase entire playlists of MP3s with a single click—and sync them directly to their music player. The basic prices seem to be a little higher than in iTunes, but the more tracks you buy the cheaper it gets: In the U.K., for example, a bundle of 10 tracks will cost £7.99 ($13.16) but 100 tracks will cost £50 ($82.38).

Read the full post on businessweek.com