Digitalization of the Music Industry

There are three music industry sectors: “recorded music,” “music licensing” and “live music” (Wikstrom). Recorded music is the master recording of any song by an artist whether it be in a studio or another setting. Music licensing makes sure artists’ music is being used legally (Wikstrom). The third sector of the industry, live music, focuses on creating and promoting concerts and music festivals (Wikstrom). “In the pre-internet music industry,” the recorded music sector was the biggest of the three and music licensing was much “more mundane,” but that quickly changed (Wikstrom). The digitalization of the music industry began with the growth of social media and the development of “file sharing services” that gave way to modern streaming platforms. One of the biggest original file sharing platforms was called ‘Napster;’ the service “allowed users to download and share music without compensating the recognized rights holders” (Wikstrom). The free and easy access to music was exciting but made the purchasing of physical items such as CDs, cassettes and vinyl not as necessary; in turn, this caused a financial disturbance in the industry (Wikstrom). Platforms like Napster were the predecessors of modern-day streaming platforms like Spotify and Apple Music (Wikstrom). The development of streaming services, along with the rise of social media, crafted the digital turning point of the music industry. This led to a complete restructuring of music distribution, changed the way artists connect with their fans, promote their music and events, and opened doors for aspiring artists. This shift also created financial problems primarily in the recorded music sector (Lozic 1).

Streaming platforms have helped artists better understand what people like, making the promotion of events in the music industry much more effective (Lozic 1). While the music industry adapted to new technological advancements, social media platforms expanded. According to the Dean of National University of Political Studies and Public Administration, Florina Pinzaru, “ever since YouTube was launched in 2005, online video content has proliferated, and in 2008 it led to a ‘video’ turn in the music industry” (Pinzaru 128). Pinzaru’s claim suggests that YouTube has been one of, if not, the best online promotion platform for the music industry. The entry highlights how YouTube has made promotion in the industry more effective for artists and has “enhanced the power of viral marketing” (Pinzaru 128). Pinzaru goes on to explain the significance of search engines and how they are built to fine-tune search results to the interests of each user. As a result, “these networks define ‘small worlds’” (Pinzaru 128). These “small worlds” help others find and connect to people with similar interests. From there, communities are often created to house a forum for conversation, review and promotion (Pinzaru 128). Thus, the internet has developed an algorithm for the music industry to relate better to their audience (Haynes 1976). According to Pinzaru “all music stars follow the consumer of their music” (Pinzaru 127). To follow the consumer, artists must be active on social media to keep their audience engaged and gather a deeper knowledge as to what they like. For example, take KPOP: the Korean pop genre of music is rarely ever advertised in the states but pulsates with American fans (Pinzaru 126). Pinzaru claims that “this type of success comes as an effect of massive online presence” (Pinzaru 126). The claim underlines how the digitalization of the music industry has made it so that artists do not necessarily have to be very talented, as long as they keep an active presence on the internet, their own self-promotion and subsequent fan base can put them on top (Pinzaru 128).

Along with self-promotion efficacy, the post-internet live music industry has become the biggest sector of the three, because it is “easier to control than recorded music” (Wikstrom). Due to the technological turn in the music industry, consumerist views shifted, causing the recorded music sector to suffer financially (Wikstrom). While some may believe that “streaming services like Spotify and Pandora” provide the recorded music industry with a stable currency, “the current pay structures [for artists] are still far less than if a consumer buys the music outright” (“How the Internet Changed Music: Recording Connection”). Consequently, the industry began to rely more heavily on live music as a primary and more reliable source of revenue. The live music industry was able to offset the financial loss due to lower physical album sales by increasing the number of concerts in a touring season and raising ticket prices (Wikstrom). “Traditionally, users discovered music either through radio play or from their friends and consumed it through album purchases” (qtd. in Dewan). But since the digital turning point which led to a “decline in revenues of global media corporations”(Lozic 1) artists more heavily rely on the live music industry for revenue (User).

Another massive change provided by the digitalization of the industry was a breakdown of the common barriers-to-entry for artists beginning their careers. Today, there are so many media and streaming platforms out there that virtually anyone can become a musician with a “sustainable income” (Haynes 1975). In addition, they provide a “greater possibility for artists to maintain self-sustaining careers without the need for record company backing” (Haynes 460). Platforms such as YouTube, Spotify, Apple Music, Bandcamp and Soundcloud make it so that artists can now thrive without a major label deal (Haynes 1975-1976). The internet has given light to the artists in the shadows and made it easy for anyone to independently manage their own careers. According to Haynes and Marshall, “In the pre-internet era, the ways in which a musician could get their music heard by potential fans were few.” Most performances were restricted, and even when they were not, there was only a small number of listeners (Haynes 1976). However, the popularity of social media platforms has made it accessible for any small artist to grow a fan base. Moreover, the integration of social media into the music industry has made “musicians less dependent on recording facilities, marketing activities, and distribution networks of record companies” (Verboord 60). The accessibility of a music career, while often a positive thing for independent artists, has, on the contrary, welcomed an oversaturation of the scene--making it very difficult to stand out amongst a sea of other artists. In an article by Florina Pinzaru and Mitan Andreea, they point out that it does not matter so much anymore whether you are a gifted singer, but that you are productive on social media and interest the consumers of this generation (Pinzaru 128). Because of the integration of social media, “the traditional distinction between professional and amateurs is blurring” (Verboord 60). The rise of social media has set a standard and a certain expectation that emerging artists in today’s landscape are forced to accept. If accepted and properly utilized, artists can establish successful careers for themselves independent of traditional major label and management deals.

The digitalization of the music industry created a massive financial and structural shift for everyone involved. Despite this shift caused by fewer physical album sales, the live music sector was able to prosper by adjusting their practices to provide higher profit margins. The simultaneous rise of social media and streaming services opened doors for small artists wanting to break into the music scene while also helping promote the surplus of shows that were now being pushed by the live music sector.

Works Cited

Dewan, Sanjeev, and Jui Ramaprasad. “Social Media, Traditional Media, and Music Sales.” MIS Quarterly, vol. 38, no. 1, 2014, pp. 101–122. www.jstor.org/stable/26554870. Accessed 30 Oct. 2020.

Haynes, Jo and Lee Marshall. “Beats and tweets: Social media in the careers of independent musicians.” Sage journals, vol. 20, no. 5, 2017, pp. 1973-1993. https://journals-sagepub-com.libweb.lib.utsa.edu/doi/full/10.1177/1461444817711404. Accessed 30 Oct. 2020.

Haynes, Jo and Lee Marshall. “Reluctant entrepreneurs: Musicians and Entrepreneurship in the ‘new’ music industry.” Wiley Journals, vol. 69 no. 2, 2018, pp. 459-482. https://onlinelibrary-wiley-com.libweb.lib.utsa.edu/doi/full/10.1111/1468-4446.12286. Accessed 30 Oct. 2020.

“How the Internet Changed Music: Recording Connection.” Recording Connection Audio https://www.recordingconnection.com/reference-library/recording-entrepreneurs/how-the-internet-changed-music/#:~:text=While%20the%20Internet%20has%20made,backing%20of%20a%20major%20label Accessed 4 Nov. 2020.

Lozic, Josko. “Digitalization Creates a New Paradigm of the Global Music Industry: The Traditional Music Industry is Under Pressure of the Streaming Platforms.” Research Gate, 2020. https://www.researchgate.net/publication/342004627_DIGITALIZATION_CREATES_A_NEW_PARADIGM_OF_THE_GLOBAL_MUSIC_INDUSTRY_THE_TRADITIONAL_MUSIC_INDUSTRY_IS_UNDER_PRESSURE_OF_THE_STREAMING_PLATFORMS. Accessed 30 Oct. 2020.

Pînzaru, Florina and Mitan Andreea. “Social Media and Marketing of the “Popcorn” Music Wave: The Success of Romanian Commercial Musicians Analysed Through Their Perceived Image on Facebook and YouTube.” Economics & Sociology, vol. 5, no. 2, 2012, pp. 125-138, 162-163. https://search-proquest-com.libweb.lib.utsa.edu/docview/1356459453?accountid=7122&rfr_id=info%3Axri%2Fsid%3Aprimo. Accessed 30 Oct. 2020.

User, Super. “About the Live Music Industry.” ILMC, www.ilmc.com/index.php/about/about-the-live-music-industry. Accessed 6 Nov. 2020

Verboord, Marc and Sharon van Noord. “The online place of popular music: Exploring the impact of geography and social media on pop artists’ mainstream media attention.” Taylor & Francis Online, vol. 14 no. 2, 2016, pp. 59-72. https://www-tandfonline-com.libweb.lib.utsa.edu/doi/full/10.1080/15405702.2015.1019073. Accessed 30 Oct. 2020.

Wikstrom, Patrik. “The Music Industry in an Age of Digital Distribution.” Open Mind BBVA, 2013,https://www.bbvaopenmind.com/en/articles/the-music-industry-in-an-age-of-digital-distribution/. Accessed 4 Nov. 2020.