Professional Documents
Culture Documents
The
impact
of
new
technologies
on
the
music
industry
ACKNOWLEDGEMENTS
I would like here to thank the people without whom I would not have been able to write
this thesis.
First of all I would like to thank Reims Management School, for giving me the opportunity to
study at Northeastern University and improve my analytical and writing skills.
I would like to thank Anne‐Laure Herard, for being so understanding with my concerns
over this thesis.
I want to thank Alain Goudey, my thesis supervisor, for sharing his ideas and concerns and
also for giving me advice and being so quick to respond to my e‐mails.
I would like to thank Junauro Landgrebe, my Rock History teacher, and Brian Bergeron, the
Teacher Assistant, for recommending me a very interesting book and giving me so much
information with their classes and discussions.
I want to thank the many people I discussed my thesis with: Sean Smith for his constant
support and for always listening to me talking about my Qindings, Ana Sanchez for saying
how much she disagreed and helping me look at other points of view on the topic, Steffen
Spillecke, Svenja Hering, Andreas Schäffer, and many more.
I want to thank my parents for supporting me in my studies and comforting my love for
music, without which I would never have been able to write this thesis, and of course my
brother, for giving me the love of music. Finally, thank you Bob Dylan, for being my favorite
artist.
To Bob Dylan, for whom I am so passionate about music...
GLOSSARY
A
AAC:
Advanced
Audio
Coding,
an
audio
compression
format.
AIM:
Association
of
Independent
Music.
ASCAP:
American
Society
of
Composers,
Authors
and
Publishers.
A&R:
Artist
and
Repertoire.
Talent
Acquisition.
B
Big
four:
The
four
major
record
labels:
EMI,
Universal
Music
Group,
Sony
Music
Entertainment,
Warner
Music
Group.
BMI:
Broadcast
Music
Incorporated.
C
CBS:
Columbia
Broadcasting
System.
D
DIY:
Do
It
Yourself.
DRM:
Digital
Rights
Management.
E
EMI:
Electric
and
Musical
Industries
Ltd.,
one
of
the
big
four.
G
GDP:
Gross
Domestic
Product.
H
HADOPI:
Illegal
downloading
law
(France).
HMV:
British
Entertainment
retail
chain.
I
IFPI:
International
Federation
of
the
Phonographic
Industry.
IPI:
Institute
for
Policy
Innovation.
ISP:
Internet
Service
Provider.
M
MPA:
Music
Publishers
Association.
N
Nielsen
SoundScan:
Information
and
sales
tracking
system
created
by
Mike
Fine
and
Mike
Shalett.
The
ofUicial
method
of
tracking
sales
of
music
and
music
video
products
throughout
the
US
and
Canada.
NME:
News
Musical
Express.
British
music
magazine.
P
Payola:
Pay‐for‐play.
The
illegal
practice
of
payment
or
other
inducement
by
record
companies
for
the
broadcast
of
recordings
on
music
radio,
in
which
the
song
is
presented
as
being
part
of
the
normal
day’s
broadcast.
P2P:
Peer
to
peer.
File‐sharing.
R
RIAA:
Recording
Industry
Association
of
America.
RCA:
Radio
Corporation
America.
S
SME:
Sony
Music
Entertainment.
U
UMG:
Universal
Music
Group.
W
WMG:
Warner
Music
Group.
1
INTRODUCTION.................................................................................. 3
1.1
SELECTED
HISTORY
OF
THE
RECORDING
INDUSTRY
AND
MAIN
PLAYERS.......................................................................................................................................3
1.1.1
TIN
PAN
ALLEY
ERA ........................................................................................................................... 3
1.1.2
RACE
RECORDS ..................................................................................................................................... 3
1.1.3
ARRIVAL
OF
THE
RADIO
AND
ITS
AFTERMATH .................................................................... 4
1.1.4
ROCK’N’ROLL
AND
THE
APPEARANCE
OF
INDIE
LABELS ................................................ 4
1.1.5
POP
MUSIC
REINVENTED................................................................................................................. 6
1.1.6
TODAY’S
DISTRIBUTION
–
BY
COMPANY
AND
REGIONS................................................... 6
1.2
ASSESSMENT
OF
THE
MAJOR
NEW
TECHNOLOGIES
THAT
WILL
BE
STUDIED.......................................................................................................................................8
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
1
3.1.1
WHAT
IS
DIGITAL
MUSIC
AND
HOW
IMPORTANT
IS
IT
IN
THE
INDUSTRY...........22
3.1.2
THE
BUSINESS
MODELS
OF
DIGITAL
DISTRIBUTION.......................................................23
3.1.3
ITUNES,
LEADER
OF
THE
INDUSTRY........................................................................................25
3.2
MUSIC
PIRACY ............................................................................................................... 26
3.2.1
WHAT
ARE
THE
EFFECTS
ON
THE
INDUSTRY? ...................................................................27
3.2.2
WHAT
WERE
THE
RESPONSES?..................................................................................................29
3.2.3
WHAT
ARE
THE
NEXT
STEPS? .....................................................................................................32
3.3
EFFECT
ON
THE
ROLE
OF
RECORD
LABELS
IN
TERMS
OF
DISTRIBUTION ....................................................................................................................... 32
4
PART
THREE
–
THE
ROLE
OF
RECORD
LABELS
AT
STAKE 33
4.1
MUSIC
PIRACY
IS
NOT
RESPONSIBLE
FOR
THE
LATE
FALL
OF
THE
INDUSTRY................................................................................................................................. 33
4.1.1
LESS
MONEY
=
LESS
SPENT
ON
ENTERTAINMENT...........................................................34
4.1.2
INCAPACITY
FOR
THE
INDUSTRY
TO
REACT
TO
THE
CHANGE
IN
CONSUMER
BEHAVIOR............................................................................................................................................................35
4.2
HOW
NEW
TECHNOLOGIES
HELPED
THE
INDUSTRY ................................ 36
4.2.1
DEVELOPMENT
OF
NEW
LABELS...............................................................................................36
4.2.2
FOR
THE
CUSTOMERS......................................................................................................................38
4.3
WHERE
DID
IT
ALL
GO
WRONG? .......................................................................... 39
4.3.1
WHY
DID
THEY
FAIL
TO
RESPOND
TO
NAPSTER? .............................................................40
4.3.2
MUSIC
IS
ANTICAPITALIST ..........................................................................................................42
5
CONCLUSION..................................................................................... 42
5.1
NEW
TECHNOLOGIES
HAVE
HELPED
THE
INDUSTRY............................... 42
5.2
THE
TREND
SEEMS
TO
SHOW
THAT
INDIE
LABELS
ARE
BENEFITING
FROM
IT
MORE
THAN
MAJORS....................................................................................... 43
5.3
WHAT
IS
THE
FUTURE? ............................................................................................ 44
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
2
1 INTRODUCTION
The
recording
industry
is
an
industry
that
can
trace
its
history
back
to
the
late
19th
century
and
the
Tin
Pan
Alley
Era.
Of
course
we
can
see
traces
of
business
around
sheet
sales
before
but
concerning
rock
music
and
popular
music,
Tin
Pan
Alley
is
the
definite
starting
point.
1.1.1 TIN PAN ALLEY ERA
The
Tin
Pan
Alley
is
the
name
given
to
the
New
York
City
music
publishers
and
songwriters
who
mastered
the
popular
music
at
that
time.
They
started
to
do
business
with
music
by
selling
sheet
music
of
traditional
and
well‐known
songs
such
as
“Take
Me
Out
to
the
Ball
Game”.
As
a
result
of
the
existence
of
the
Tin
Pan
Alley,
musicians,
publishers
and
songwriters
started
to
work
together
for
the
public
and
created
in
1914
the
American
Society
of
Composers,
Authors
and
Publishers
(ASCAP)
to
protect
copyright
infringement,
or
in
1895
the
Music
Publishers
Association
of
the
United
States.1
1.1.2 RACE RECORDS
Number
of
evolutions
during
the
20th
century
shaped
the
industry
as
we
know
it
today.
The
beginning
of
the
century
was
rarely
organized
around
labels,
however
with
the
arrival
of
blues
in
the
1910s
and
1920s
it
began
to
be
organized
with
a
business
goal.
Because
more
and
more
slaves
and
workers
from
the
South
were
creating
music
but
it
was
not
yet
accepted
by
the
society,
Race
Records
were
created
in
order
to
organize
and
promote
those
artists,
it
was
music
made
by
and
for
African
American.
Many
major
record
labels
issued
special
“race”
series
records
between
the
mid
1920s
and
the
1940s
as
a
result
of
growing
popularity
even
among
white
people.
Mamie
Smith,
a
famous
classic
blues
singer,
was
the
first
African
American
vocalist
to
be
featured
on
a
1
Sanjek,
Russell.
American
Popular
Music
and
Its
Business:
The
First
Four
Hundred
Years,
Volume
III,
From
1900
to
1984. New York: Oxford University Press, 1988.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
3
recording2.
This
part
of
the
century
was
a
great
turning
point
in
the
history
of
the
music
industry
because
it
recognized
music
as
an
art
that
everybody
could
participate
in
and
also
was
a
great
influence
on
the
rest
of
the
rock
and
roll
history.
1.1.3 ARRIVAL OF THE RADIO AND ITS AFTERMATH
In
1922,
an
important
factor
changed
the
industry:
radio
broadcasting
begun
in
the
USA.
Radio
networks
appeared
and
linked
together
to
bring
in
massive
advertising
revenue.
The
companies
running
the
different
radio
networks
broadcasted
programs
that
were
much
more
enticing
to
the
listeners
because
it
was
free.
As
a
result,
people
started
to
buy
fewer
records
and
the
downturn
was
massive
for
the
players
in
the
industry.
Just
by
the
beginning
of
the
1920s,
the
size
of
the
industry
declined
by
one
half.
It
then
stabilized
but
is
still
considered
as
the
first
major
depression
of
the
record
industry.
3
This
first
hard
hit
that
the
industry
took
led
to
the
first
need
to
reevaluate
the
offer
and
demand
of
the
industry.
Because
the
main
drawback
of
listening
to
the
radio
was
the
poor
quality
of
the
recordings,
manufacturers
began
to
introduce
new
recording
equipment
to
improve
the
quality
of
the
sound.
This
began
in
the
late
20s
and
was
called
the
“electrical
recording”.
The
hope
behind
this
was
to
get
back
the
customers
that
decided
to
buy
fewer
records
by
promising
them
an
outstanding
quality.
This
helped
a
little
but
the
Great
Depression
of
the
30s
arrived
and
the
labels
were
still
too
weak
to
go
through.
Victor
Records
was
bought
by
the
Radio
Corporation
of
America
(RCA
records);
Columbia
was
bought
by
the
Columbia
Broadcasting
System.
The
others
just
disappeared.
The
market
declined
little
by
little
even
though
new
opportunities
arose
such
as
motion
pictures
(Walt
Disney
Company
was
created
in
1926)
or
jukeboxes.
1.1.4 ROCK’N’ROLL AND THE APPEARANCE OF INDIE LABELS
The
next
turning
point
in
the
history
of
the
record
industry
is
the
1950s
and
the
arrival
of
Rock
and
Roll.
Because
the
market
grew
bigger
with
the
social
changes
of
the
50s
(teens
had
more
money
and
became
a
real
market,
they
defined
themselves
both
socially
2
Charlton,
Katherine.
Rock
Music
Styles,
a
history.
Fifth
Edition.
New
York:
McGraw
Hill
Companies
Inc.,
2008.
Ch.
1
&
2
3
History
of
the
recording
technology,
Recording
History.
www.recording‐history.org,
page
3.
Retrieved
on
Monday
March the 8th
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
4
and
economically…),
major
records
saw
a
real
opportunities
to
revive
the
industry.
However
rock
and
roll
was
not
accepted
by
the
society
because
it
was
too
crude,
went
against
the
good
values
of
the
USA
and
some
was
sung
by
black
people.
As
a
result,
the
recording
industry
began
to
divide
and
saw
the
appearance
of
the
first
“independent”
labels.
Major
labels
such
as
RCA‐Victor,
Columbia
or
Decca
were
the
ones
distributing
the
socially
acceptable
music
of
America.
They
produced
75%
of
the
hits
between
1948
and
1955
and
included
popular
artists
that
reflected
the
tastes
and
values
of
Middle
America
such
as
Frank
Sinatra,
Patti
Page
&
Perry
Cuombo.
The
music
was
inoffensive,
conservative
and
most
importantly,
mainstream.
Those
labels
had
been
well
and
alive
for
many
decades
yet
and
had
the
financial
stability
needed
to
use
state
of
the
art
recording
equipment,
they
had
ownership
of
the
record
presses,
used
a
system
of
warehouses
and
wholesalers
and
promoted
their
artists
through
the
radio,
movies
and
TV.
On
the
other
side
of
the
industry
began
to
appear
independent
labels
as
a
response
to
the
major’s
failure
to
offer
what
the
people
wanted:
rock
and
roll.
It
was
not
the
first
time
that
independent
labels
had
a
significant
importance
(Race
Records
in
the
20s)
but
definitely
reflects
the
next
decades
of
the
industry.
The
independent
record
labels
were
a
niche
market
that
gathered
recorded
artists
of
music
for
the
audience
that
the
majors
did
not
serve.
This
was
jazz,
blues,
rhythm
and
blues,
country
and
of
course
Rock
and
Roll.
The
main
people
responsible
for
this
kind
of
music
to
be
recorded
and
released
were
predominantly
white
club
owners,
retailers
or
sound
engineers;
they
served
different
musical
tastes
that
did
not
correspond
to
the
mainstream
society.
However
because
they
were
pretty
new
in
existence
they
did
not
have
the
financial
capabilities
that
major
labels
had.
As
a
result
they
had
to
use
outdated
equipment,
garage
as
studios
and
needed
to
be
highly
innovative
in
recording
techniques
to
cut
costs.
Thanks
to
those
labels
the
50s
were
a
period
of
great
technological
innovation
in
terms
of
recording:
multi‐track
recording,
tape
slicing,
overdubbing,
echo,
reverb
and
other
effects.4
The
main
independent
labels
were
focusing
on
specific
styles.
Atlantic
Records
(created
in
1947
in
New
York
City),
owned
by
Ahmet
Ertegun
and
Herb
Abrahmson,
were
4
Landgrebe,
Junauro.
Class:
Rock
Music
History,
MUSC1101,
Northeastern
University
Spring
Semester.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
5
focusing
on
Rhythm
and
Blues,
Blues,
Gospel,
Jazz,
Soul,
Hard
Rock
and
Heavy
Metal.
Sun
Records
(aka
Memphis
Recording
Service,
was
created
in
1944
in
Memphis),
were
owned
by
Sam
Phillips
and
focused
on
Blues,
Country,
Rhythm
and
Blues
and
Rockabilly,
they
were
at
the
helm
of
Rock’n’Roll
during
the
fifties.
Finally,
Chess
Records
was
created
in
Chicago
by
Phil
and
Leonard
Chess
and
was
mainly
a
blues
record
(Chicago
Blues
artists
such
as
Muddy
Waters,
Howlin’
Wolf,
Aretha
Franklin…).
Independent
labels
promoted
their
music
mainly
through
radio
as
local
radio
stations
turned
away
from
mainstream
music
to
reflect
tastes
and
interests
of
their
audience.
For
example
WDIA
Memphis
was
in
1948
the
first
radio
station
to
adopt
all
black
programming.
To
do
so
they
had
to
pay
DJs
such
as
Alan
Freed
(who
first
coined
the
term
Rock’n’Roll
in
1956
through
his
movie
Rock,
Rock,
Rock.
The
problem
is
that
under
US
law
47
U.S.C.
§3175
it
is
highly
forbidden
to
bribe
DJs
to
play
songs
on
the
radio.
As
a
result,
the
career
of
Alan
Freed
was
thrown
into
the
dumpsters
for
being
accused
of
being
bribed.
The
payola
scandal
was
a
first
example
of
the
battle
between
major
and
independent
label,
a
pattern
repeated
often
in
the
second
half
of
the
century.
1.1.5 POP MUSIC REINVENTED
However,
major
labels
did
recognize
a
change
in
consumer
behavior
and
responded
to
it
with
pop
music.
Cover
artist
such
as
Pat
Boone
and
teen
pop
idols
were
widely
marketed
while
still
pleasing
the
society
by
removing
suggestive
lyrics
and
using
the
music
style
that
the
youth
fancied
the
most.
The
Brill
Building
in
New
York
City
was
the
headquarters
of
those
labels
who
owned
songwriters
such
as
Neil
Diamond,
Neil
Sedaka
or
Phil
Spector
but
also
musicians
to
write
and
record
music
that
were
played
by
socially
acceptable
artists
such
as
Paul
Anka
or
Fabian.
The
line
between
mainstream
music
and
indie
music
was
traced
and
Rock’n’Roll
began
its
challenging
journey.
1.1.6 TODAY’S DISTRIBUTION – BY COMPANY AND REGIONS
Nowadays
the
industry
is
still
divided
between
the
“big
four”
and
independent
labels.
The
music
industry
itself
is
comprised
of
various
players
such
as
individuals,
companies,
trade
unions,
not‐for‐profit
organizations,
rights
collectives
and
other
bodies,
5
US
Code,
Title
47,
Chapter
5,
Subchapter
III,
Part
I,
Section
317.
Announcement
of
payment
for
broadcast.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
6
professional
(studio)
musicians,
performers,
venue
owners
etc.
In
the
USA,
the
two
main
copyright
collectives
and
performance
rights
associations
are
ASCAP
and
BMI
(Broadcast
Music
Incorporated).
According
to
a
Nielsen
SoundScan
report
of
2009,
the
big
four
accounted
for
88.53%
of
full
album
sales
and
was
divided
as
follows6:
Album
sales
distribution
2009
Independent
Labels
11%
EMI
Group
Universal
Music
Group
Universal
Music
9%
Group
Sony
Music
Entertainment
30%
Warner
Music
Group
Warner
Music
EMI
Group
Group
21%
Independent
Labels
Sony
Music
Entertainment
29%
The
four
big
players
in
the
industry
are
Universal
Music
Group
(UMG),
Sony
Music
Entertainment
(SME),
Warner
Music
Group
(WMG)
and
EMI
Group
(EMI).
Prior
to
1998,
the
industry
was
dominated
by
the
“big
six”
as
Sony
Music
and
BMG
had
not
merged
and
PolyGram
had
not
yet
been
purchased
by
UMG.
Geographically,
the
repartition
is
mainly
done
between
the
US,
Europe
and
Asia:
the
USA
are
responsible
for
27%
of
recorded
music
sales,
Europe
for
39.6%,
Asia
for
25.9%
and
Latin
America
for
2.8%.7
6
The
Nielsen
Company
2009
Year‐End
Music
Industry
Report
7
IFPI.
Recorded
music
sales
report.
2008
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
7
A
report
for
the
IFPI
(Recorded
Music
Sales
2007)
shows
that
the
main
5
players
globally
are
the
USA,
Japan,
the
UK,
Germany
and
France
for
both
physical
and
digital
music
sales.8
As
you
can
see
from
this
table
the
distribution
between
Physical
and
Digital
sales
mainly
reflects
the
trend
in
countries
such
as
France,
Japan,
Germany
and
the
UK
with
the
only
exception
of
the
US
where
digital
sales
are
higher
as
a
percentage.
The
country
that
has
the
lowest
percentage
of
sales
in
the
digital
format
is
Germany.
The
table
also
shows
that
the
music
industry
is
an
industry
that
exists
mainly
in
developed
countries
and
that
is
distributed
between
four
major
players
and
the
independent
labels.
This
is
the
industry
we
are
going
to
investigate
further
to
see
how
the
new
technologies
changed
its
business
model
and
led
to
new
horizons
and
opportunities,
but
also
challenges
as
seen
in
the
selected
history.
1.2
ASSESSMENT
OF
THE
MAJOR
NEW
TECHNOLOGIES
THAT
WILL
BE
STUDIED
New
technologies
in
the
music
industry
are
technologies
that
showed
big
changes
in
the
last
decades.
Those
are
recording
technologies
first
of
all,
but
also
exogenous
technologies,
not
directly
related
to
the
industry,
which
had
an
impact
on
the
way
companies
did
business.
Those
are
the
Internet
and
mobile
technologies
(new
products
or
services
that
can
be
used
to
enhance
our
lives
and
productivity
when
we
are
on
the
go9).
Because
we
will
mainly
focus
on
the
business
side
(promotion
and
distribution),
the
new
technologies
we
are
going
to
study
are
Internet,
high‐tech
improvements
and
8
IFPI.
Recorded
music
sales
report.
2007
9
MIT
$100k
Entrepreneurship
Competition
–
Track
Description.
Retrieved
from
http://www.mit100k.org/the‐100k‐
competition/track‐descriptions/ on March the 8th
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
8
the
technology
linked
to
mobile
devices
improvement.
We
will
investigate
the
trends
linked
to
the
development
of
social
medias
websites,
online
radios,
digital
stores
such
as
the
iTunes
Music
Store,
video
games,
smart
phones,
MP3
readers
etc.
In
order
to
fully
comprehend
the
changes
linked
to
the
advancement
of
new
technologies,
we
have
to
first
investigate
how
marketing
and
promotion
of
the
music
is
traditionally
done.
2.1 MUSIC MARKETING AND PROMOTION DEFINED
The
bottom
line
of
music
marketing
and
promotion
is
and
has
always
been
maximizing
sales
and
exposure
of
the
music.
It
is
the
systematic
approach
to
looking
for
money
with
commercial
music
and
doing
with
as
much
precision
and
skills
as
any
other
industry.
The
process
of
marketing
in
the
music
goes
from
point
A
to
point
B.
Point
A
being
“having
a
product”
and
then
getting
“rack
space”.
Rack
space
is
making
sure
that
the
product
is
presented
and
sold
in
every
distribution
channel
one
can
think
of,
both
physical
and
digital.
Music
promotion
is
one
part
of
the
marketing
process,
music
distribution
is
the
other.
Music
promotion
involves
launching
awareness
of
the
product
and
spurring
attraction
to
it,
always
with
the
goal
of
boosting
sales
before
everything
else.
Promotion
can
be
made
through
4
media:
print,
radio,
television
and
the
Internet.
They
all
present
different
opportunities
and
challenges
and
can
all
be
traced
back
to
the
history
of
the
record
business.
Additionally,
we
can
consider
live
performance
as
another
kind
of
promotion
as
the
artist
itself
is
a
product,
being
marketed
as
himself
and
not
only
as
the
music
he
performs.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
9
The
basic
infrastructure
of
today’s
marketing
can
be
traced
back
to
the
1950s
when
the
main
formats
(records
and
sheet
music)
were
accompanied
by
communication
tool
to
promote
their
sales
(radio,
movies,
jukebox
and
live
performances)
and
expose
their
music
to
a
much
wider
customer
base.
In
the
1980s,
Music
Television
(MTV)
appeared
and
led
path
to
a
new
kind
of
promotion
tool:
music
videos.
Performers’
image
became
more
important
to
the
crowds
and
a
bigger
emphasis
was
put
on
video
stars.
MTV
was
a
first
because
it
showed
music
videos
and
not
live
performances
on
the
contrary
to
the
Old
Grew
Whistle
Test,
Ed
Sullivan
Show,
the
Rock’n’Roll
Circus
or
other
shows
that
brought
live
bands
to
be
broadcast
globally
(that
is
to
say
in
developed
countries
and
mainly
the
US
and
the
UK).
Finally
the
21st
century
showed
the
appearance
of
a
new
communication
tool:
the
Internet.10
2.1.1 PROCESS
Traditionally
there
are
6
departments
involved
in
the
marketing
activities
of
a
large
record
companies.
Those
are
• Sales:
responsible
for
distribution
and
sales
promotion.
They
will
check
out
the
retailers’
calendars
for
rack
space
availability
and
cost,
look
for
CD
pressing
facilities
aligned
with
their
cost
strategy
(usually
the
lowest),
set
the
suggested
retail
price
of
the
CD
and
confirm
ad
placement
to
make
sure
it
is
aligned
with
the
cost
strategy.
• Publicity:
responsible
for
exposure
of
the
product
through
print,
electronic
and
broadcast
media.
The
publicity
department
will
ensure
that
the
media
exposure
campaign
is
aligned
with
their
goals.
They
will
design
and
organize
press
releases
or
other
PR
materials
such
as
photo
shoots,
interviews
of
the
artists
and
make
sure
that
the
CD
release
go
to
the
right
persons
to
get
the
most
needed
reviews.
• Creative
Services:
are
responsible
for
creation
and
production
of
marketing
material.
This
also
means
CD
packaging
(usually
co‐decided
with
the
band),
web‐site
design
(if
a
web‐site
is
dedicated
to
the
band,
another
publicity
platform)
or
video
production
for
the
music
video.
• Advertising:
responsible
for
the
creation
of
ads
and
placement
in
print,
electronic
and
broadcast
media.
10
Lathrop,
Ted.
This
business
of
Music
Marketing
and
Promotion.
New
York:
Billboard
Books.
2003
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
10
• Promotion:
responsible
for
radio
play
of
recordings.
The
VP
will
be
in
close
contact
with
regional
promotion
personnel
such
as
DJs,
programmers,
and
press
people.
• Marketing:
responsible
for
development
and
management
of
marketing
programs.
This
means
responsible
for
every
step
from
manufacturing
to
distribution.
In
the
music
industry,
manufacturing
also
means
discovering
the
artist
and
organizing
recordings.
Traditionally
then,
the
marketing
process
can
be
seen
as
the
flowchart
exhibit
1
–
Flowchart
of
the
standard
record
manufacturing/marketing
process.
The
first
link
between
the
artist
and
the
record
company
is
the
A&R
(or
Artists
and
Repertoire
aka
Talent
Acquisition),
the
most
important
links
between
the
artists
and
the
consumers
are
therefore
A&R,
Recording
Studio,
Pressing/Duplication,
Distributor
and
Mass
Media.
All
those
steps
are
prominent
to
the
distribution
of
an
artist.
If
an
artist
does
not
get
mass
media,
it
means
it
will
get
no
airplay
or
publicity
and
will
be
unknown
to
the
public.
On
the
other
hand
if
the
recording
studio
or
the
Pressing/Duplication
steps
are
forgotten,
the
band
can
get
much
airplay
or
be
invited
to
many
live
shows,
they
will
not
be
able
to
sell
their
album,
i.e.
not
respond
to
the
demand
and
will
soon
be
forgotten.
It
is
important
to
note
however
than
an
artist
can
come
directly
to
the
A&R
of
a
record
company
and
sell
his
already
recorded
album,
the
next
step
will
then
be
Marketing/Promotion
as
shown
on
the
chart.
The
crucial
element
in
this
entire
process
is
finally
the
distributor,
and
thus
the
sales
team,
making
sure
it
has
enough
rack
space,
is
distributed
where
there
is
demand
and
at
the
right
time.
Other
steps
in
the
process
include
copyright,
performance
rights
and
mechanical
and
synchronization
rights.
Copyrights
are
registered
with
the
US
Copyright
Office
(in
the
US),
it
provides
legal
protection
from
theft
or
plagiarism
for
both
the
music
and
the
lyrics
of
a
song.
Performance
rights
are
registered
with
the
ASCAP
or
BMI.
This
step
is
to
make
sure
the
royalties
due
to
the
artists
are
calculated
without
any
conflict
of
interest
and
paid
to
duly.
It
covers
every
source
of
income
for
a
song
as
shown
in
exhibit
2
–
Examples
of
incomegenerating
uses
for
a
song.
Mechanical
and
synchronization
rights
cover
“the
collection
and
payment
of
licensing
fees
for
new
versions
of
the
music
used
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
11
on
other
artists’
CDs
and
tapes”,
the
synchronization
rights
include
the
use
of
music
in
a
movie,
television
or
even
home
videos.
11
Those
four
rights
add
a
very
lucrative
aspect
to
the
business
in
the
hope
of
diminishing
copyright
infringement
and
generating
more
revenue
or,
as
the
goal
is,
maximizing
profits
and
exposure.
This
paragraph
shows
us
well
how
the
usual
process
goes
for
marketing
of
the
music.
Lately
new
technologies
have
opened
the
way
to
new
challenges
and
also
new
opportunities
that
we
will
investigate
further.
2.2 ONLINE PROMOTION
Online
promotion
is
the
act
of
developing
a
promotional
campaign
via
online
tools,
that
is
to
say
the
Internet.
This
can
be
done
through
many
different
media
but
always
imply
a
website.
The
term
media
then
refers
to
the
different
platforms:
social
media,
online
radio
or
online
management
tools.
2.2.1 FACEBOOK, MYSPACE AND OTHER SOCIAL MEDIA TOOLS
Facebook
and
MySpace
might
probably
be
the
best‐known
social
media
tools
and
the
very
first
too.
Facebook
was
created
from
Mark
Zuckerberg’s
dorm
at
Harvard
in
2003,
first
as
Facemash,
a
website
dedicated
to
rating
the
“hottest”
person
between
two
Harvard
students.
Because
it
was
the
first
online
Harvard
directory
with
photos
and
basic
information,
the
website
received
450
visitors
and
22,000
photo
views
in
its
first
hour
online.12
Nowadays
Facebook
offers
much
more
feature
and
notably
fan
pages,
groups
and
music
applications
including
games
or
options
to
share
the
music
people
like
among
friends
(iLike).
MySpace
was
founded
in
2003
as
well
by
Brad
Greenspan,
Chris
DeWolfe,
Josh
Berman
and
Tom
Anderson
as
a
response
to
the
creation
to
the
late
Friendster.
It
was
created
at
first
as
a
data
storage
and
sharing
website.
It
was
later
bought
by
Rupert
Murdoch’s
11
Lathrop,
Ted.
This
business
of
Music
Marketing
and
Promotion.
New
York:
Billboard
Books.
2003.
pp.
9‐19
12
Locke,
Laura.
The
Future
of
Facebook.
Time
Online.
Retrieved
on
March
8th
from
http://www.time.com/time/business/article/0,8599,1644040,00.html
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
12
News
Corporation
(parent
of
Fox
Broadcasting)
and
later
launched
in
the
UK
(2006)
in
a
plan
to
tap
into
the
UK
music
scene.13At
that
time,
all
MySpace
hoped
for
was
for
the
bands
“to
market
through
MySpace
so
they
could
tap
into
the
local
events
scene,
parties,
clubs,
artists,
film
makers,
television
producers”
by
integrating
bands
from
MySpace
into
the
show
CD:USA
that
was
about
to
come
the
UK
at
that
time.
Nowadays,
both
Facebook
and
MySpace
offer
similar
tools
for
bands
to
promote
themselves.
Facebook
pages
offer
the
band
to
upload
songs
(after
having
proved
they
are
allowed
to
promote
this
band),
pictures,
and
videos,
manage
a
calendar
of
event
and
send
mass
messages
to
their
fans.
Facebook
states
on
their
website
that
“only
the
official
representative
of
an
artist,
business,
or
brand
may
create
a
page”,
this
gives
an
idea
of
legitimacy
to
the
status
of
pages.
Pages
are
a
very
useful
tool
for
artists
to
promote
themselves
for
the
following
reasons:
• Facebook
pages
are
indexed
in
search
engines.
This
means
not
only
Facebook
search,
but
also
Google,
Bing,
Yahoo
or
whatever
search
engine
someone
wants
to
use.
Put
it
another
way,
by
creating
a
Facebook
page,
bands
do
not
have
to
struggle
with
developing
an
online
promotion
campaign,
a
process
that
can
be
complicated
and
costly
to
the
rookies.
• A
Page
can
have
multiple
administrators.
This
can
be
compared
to
the
process
of
music
marketing
aforementioned.
Because
a
page
can
have
multiple
administrator,
someone
can
be
responsible
of
uploading
the
song,
another
one
for
writing
newsletters
(called
“updates”),
uploading
photos,
responding
to
the
fans
and
much
more
• Facebook
pages
allow
you
to
analyze
traffic
once
you
have
reached
a
certain
number
of
fans.
It
captures
data
about
its
visitors:
how
often,
what
song
was
listened
to
the
most
etc.
• There
are
no
limits
to
the
number
of
fans
a
page
can
have.
Word
of
Mouth
then
has
an
outstanding
power
as
it
will
exponentially
increase
the
number
of
fans
as
it
13
Bridge,
Rowan.
MySpace
looks
to
UK
music
scene.
BBC
online.
Retrieved
on
March
8th
from
http://news.bbc.co.uk/2/hi/technology/4642622.stm
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
13
is
most
likely
that
people
will
suggest
the
page
to
their
friends
(another
feature
of
the
Pages
tool)
• You
can
send
updates
and
message
to
all
of
your
fans
at
once,
those
messages
on
the
contrary
to
regular
“friend‐to‐friend”
inbox
messages,
can
be
either
forwarded
or
“post”
to
other
peoples’
“walls”.14
The opportunities for artists to do their own promotion are thus very big.
MySpace
offers
an
interactive
music
player
to
distribute
songs.
On
this,
artists
can
choose
to
allow
or
forbid
download
of
the
song.
Other
features
present
on
MySpace
include
profiles,
comments,
friends
list,
events
calendar,
and
blog.
Also
a
main
feature
that
differentiates
MySpace
from
Facebook
is
the
fact
that
MySpace
allows
HTML
editing
to
its
pages.
This
means
that
a
band
that
is
tech‐savvy
can
personalize
its
MySpace
page
to
the
fullest,
designing
and
choosing
its
own
background,
the
design
of
its
music
player,
and
so
much
more.
MySpace
has
been
getting
much
attention
from
the
media,
organized
band
slams
(band
competition).
The
Rolling
Stones
Magazine
has
even
released
a
list
of
the
25
most
popular
bands
on
MySpace,
asking
its
readers
to
rank.
1,700
people
participated
in
the
survey.15
Other
social
media
websites
used
by
bands
or
labels
for
promotion
include
Twitter.
Twitter
was
created
by
Evan
Williams
in
2007
as
an
sms‐microblogging
website.
The
way
bands
and
labels
use
Twitter
is
for
short
messages
(microblogging)
announcing
anything
really.
A
band
could
use
it
to
announce
the
launch
of
their
new
album
(sales
objective)
or
to
tell
their
fans
that
they
are
eating
apples
and
drinking
beers
at
that
particular
time.
Twitter
helps
to
cut
the
wall
between
the
fans
and
the
artists,
the
latter
becoming
more
human,
more
approachable.
Eventually
this
leads
to
a
more
loyal
fan
base
and
indeed
a
better
exposure.
On
Twitter
it
is
not
compulsory
to
have
a
form
of
identification
that
proves
you
are
the
official
representative
of
the
artist
but
accounts
can
have
a
cloud
that
says
“verified
account”.
14
Haydon,
John.
Facebook
Groups
and
Pages
–
Features,
benefits
and
killer
tips.
Retrieved
on
March
8th
from
http://johnhaydon.com/2009/04/facebook‐groups‐pages‐tips/
15
Rolling
Stone
Declares
the
25
best
bands
on
MySpace.
Retrieved
on
March
8th
from
http://www.rollingstone.com/rockdaily/index.php/2006/12/22/rolling‐stone‐declares‐the‐25‐best‐bands‐on‐
myspace/
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
14
See
exhibits
3,
4
and
5
for
screen
grabs
of
the
MySpace,
Facebook
and
Twitter
pages
of
different
bands.
Zach
Pentel,
supervisor
of
social
media
at
Martin/Williams
Advertising
in
Minneapolis,
MN
and
CEO
of
808
Management,
a
consultancy
firm
for
independent
artists,
wrote
an
article
called
“5
superb
social
media
tools
for
musicians”.
In
this
article
he
goes
beyond
the
regular
Facebook
Page
and
Twitter
Account.
In
Facebook
he
describes
an
application
called
ReverbNation’s
MyBand
(see
exhibit
6)
that
allows
a
better
layout
of
your
page,
with
the
main
info
on
the
center.
It
also
allows
downloading
songs.
Concerning
Twitter,
the
application
Mr.
Pentel
describes
is
Twiturm
that
allows
sharing
songs
with
your
followers;
it
allows
integrating
MySpace
into
Twitter,
once
again
limiting
the
need
to
go
through
the
struggle
of
managing
different
websites.
Additionally,
as
exhibit
7
shows,
a
small
bar
allows
the
listener
to
share
the
song
on
multiple
other
social
media
websites:
Facebook,
Tumblr,
StumbleUpon
etc.
FanBridge
(exhibit
8)
is
a
service
that
allows
managing
mailing
lists.
Allowing
reaching
people
that
are
not
on
Facebook,
Twitter
and
MySpace.
BandCamp
(exhibit
9)
again
is
a
solution
alternative
to
the
three
main
tools
aforementioned.
On
BandCamp,
a
band
manager
can
build
and
share
a
digital
album,
without
needing
to
find
distribution
through
a
record
deal.
It
is
a
complete
DIY
solution
for
digital
music
distribution.
Highly
customizable,
it
allows
to
basically
create
your
own
online
store
and
website
for
both
sales
and
exposure
objectives.
Finally
the
last
tool
describe
by
Mr.
Penter
is
BandMetrics
(exhibit
10).
BandMetrics
is
designed
only
for
musicians
that
are
looking
to
estimate
the
success
of
their
e‐marketing
campaign.16
2.2.2 WEB MUSIC 101
Web
Music
101
is
to
look
at
the
different
ways
the
web
is
used
with
the
music.
Web
Music
does
not
necessarily
mean
social
media
tools
for
bands.
It
is
every
single
way
for
an
individual
to
either
share
music
he
likes,
discover
new
music,
promote
his
band
or
create
himself
a
name
in
the
music
world.
Those
sites
can
be
sites
to
share
music
but
16
Pentel,
Zach.
5
super
social
media
tools
for
musicians.
Mashable,
the
Social
Media
Guide
Online.
Retrieved
on
March
9th from http://mashable.com/2010/01/04/social‐media‐tools‐bands/
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
15
also
online
management
companies
that
link
artists
and
venue
managers
or
finally
websites
that
everybody
can
use
to
listen
to
music
online.
Internet
radios
are
websites
to
either
build
a
playlist,
listen
to
a
specific
radio
stations
everywhere
in
the
world
or
listen
to
random
songs.
The
most
famous
online
radios
(besides
radio
stations’
websites)
are:
• Pandora:
Available
only
in
the
US,
Pandora
allows
the
visitor
to
create
a
free
account
that
will
allow
him
to
listen
to
a
multitude
of
songs.
The
way
it
is
set
up
is
that
the
visitor
will
be
prompt
to
input
the
name
of
a
song
or
the
name
of
a
band
he
likes
and
Pandora
will
then
create
a
playlist
based
on
similar
sounds.
“It’s
a
new
kind
of
radio,
the
one
that
only
plays
music
you
like,”
announces
the
website.
When
someone
has
an
account,
he
is
not
limited
to
the
number
of
songs
it
can
listen
to,
without
an
account
this
number
is
limited
to
20
songs.
Other
features
available
on
Pandora
are
the
“thumbs
up”
or
“thumbs
down”,
“thumbs
up,”
allows
to
narrow
your
playlist
by
favoring
the
genres
that
you
really
like.
By
clicking
on
“thumbs
down”
you
tell
the
website
you
do
not
want
to
listen
to
that
song
anymore.
It
is
also
possible
to
create
playlists
based
on
genre
or
get
information
about
the
music
you
are
listening
to
(e.g.
why
they
picked
this
one,
artist’s
bio
etc).
The
biggest
advantage
with
Pandora
is
that
it
takes
into
account
that
each
song
will
be
different
and
really
recommends
songs
and
not
artists
as
a
whole.
Playlist
are
usually
called
as
a
song
(e.g.
“Run
Chicken
Run”
by
The
Felice
Brothers),
putting
the
emphasis
on
the
song’s
style
and
not
the
artist’s.
See
exhibit
11
for
a
description
of
what
they
call
the
“Music
Genome
Project”
by
which
they
recommend
songs.
• Last.Fm:
A
British
website
created
in
2002,
Last
FM
allows
the
visitor
to
have
a
personalized
profile
on
which
he
can
add
as
many
songs
as
he
wants,
create
playlists
and
share
those
playlists.
Another
feature
is
what
Last.Fm
calls
the
“audioscrobbler”
that
will
skim
through
your
portable
audio
player,
iTunes
or
Windows
Media
Player
library
and
recommend
artists
based
on
what
is
out
there.
On
Last.Fm
once
you
have
created
a
profile
and
added
a
couple
of
songs,
you
get
recommendations
each
time
you
log
in.
You
also
have
the
possibility
to
download
MP3
that
were
made
available
for
free
through
the
artist
itself.
You
are
also
allowed
to
add
“fan
pics”
of
your
artists.
The
way
it
works
for
artists
is
to
register
their
label
or
artists
with
Last.Fm.
Registration
as
an
artist
is
entirely
free,
only
some
optional
features
are
available
for
a
fee.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
16
• Deezer:
Launched
in
France
in
2007,
Deezer
was
originally
a
free
music
streaming
website.
Put
it
simply
one
could
listen
to
any
song
available
on
their
small
catalogue
(only
165,000
Sony
and
Universal
songs).
They
had
some
legal
issues
regarding
uploading
but
changed
their
business
model
with
the
new
launch
in
early
2009.
Today
the
website
is
restricted
based
on
the
location
of
the
user,
it
is
also
prompted
to
create
an
account.
Deezer
now
offers
monthly
subscription
fees
that
allows
access
to
a
broader
catalogue,
to
retrieve
one’s
playlist
wherever
they
are
with
an
Internet
collection
(quite
useful
when
associated
with
they
Blackberry,
Android
and
iPhone
applications)
and
allows
people
to
create
profiles,
giving
a
bigger
social
networking
dimension
to
the
website.
It
is
not
possible
on
Deezer
to
upload
one’s
song
and
distribute
it
as
“any
personal
MP3s
uploaded
to
the
site
can
only
be
accessed
by
the
member
who
uploaded
it”17
• Musicovery:
An
interactive
and
completely
customizable
Internet
radio
that
allows
the
listener
to
make
a
very
advanced
search
to
listen
to
music.
Going
on
the
website
(see
exhibit
12),
the
listener
can
either
look
for
an
artist,
go
to
his
favorite
songs,
artists,
listen
to
the
“hits”
or
play
a
random
song.
It
is
also
possible
to
look
for
songs
by
selecting
or
unselecting
genres
(20
different
are
proposed),
a
period
(by
decades
since
the
50s,
or
older
than
the
50s),
a
mood
(energetic,
positive,
calm,
dark),
choose
the
dance
of
the
song
(tempo
+
or
‐,
dance
+
or
‐).
When
everything
is
selected
a
song
shows
up
aligned
in
a
cloud
of
other
songs
related
one
to
another
by
genre,
period
etc.
It
is
then
possible
to
“heart”
or
“broken
heart”
a
song,
to
be
redirected
to
iTunes
Music
Store,
Amazon
or
eBay
to
buy
the
song
or
to
switch
song
(see
exhibit
13).
Online
management
websites
are
sites
that
allow
venue
managers
to
be
put
in
contact
with
independent
artists.
Those
websites
play
the
role
of
Talent
Acquisition
or
Promoters
and
sometimes
offer
promotion
tools
for
the
musicians.
They
can
also
include
agents,
managers
and
record
companies
looking
for
new
talents.
Such
a
website
I
was
introduced
to
at
a
conference
on
Entrepreneurship
in
the
Music
Industry
is
called
SonicBids.
“SonicBids
helps
bands
get
gigs
and
promoters
book
the
right
bands”18.
A
website
for
promoters
and
bands.
By
creating
your
profile
you
can
apply
(as
an
artist)
to
different
promoter
profiles
you
want
to
listen
to
your
music.
17
www.deezer.com
18
www.sonicbids.com
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
17
Promoters
also
have
access
to
a
broad
catalogue
of
artists.
Artists
have
to
create
their
Electronic
Press
Kit
(EPK)
and
can
track
their
Twitter,
MySpace
and
Facebook
stats
through
SonicBids.
Promoters
create
their
EPK
too
and
then
list
the
gigs
they
are
having
for
artists
to
apply
to
them.
Brands
can
also
have
a
profile
on
SonicBids
to
sponsor
events
such
as
college
gigs,
sponsor
artists,
get
more
online
advertising
etc.
To
conclude,
web
music
is
every
single
tool
that
artists
can
use
to
promote
their
music
either
voluntarily
or
not.
The
buzz
created
around
the
Internet
is
a
great
help
for
bands
who
can
benefit
from
free
promotion.
If
people
like
that
music
they
hear
they
will
share
it
with
their
friends
either
using
Youtube,
Facebook,
Twitter,
Tumblr,
Last.Fm,
StumbleUpon
or
any
single
social
networking
site
one
can
think
about
that
has
a
“share”
option.
Have
one
friend
on
it
and
it
is
sufficient,
chances
are
this
friend
will
share
with
two
of
his
friends
who
will
then
share
with
two
of
them
friends
and
so
on.
It
spreads
like
wild
fire.
A
good
example
of
how
tremendous
the
snowball
effect
of
online
promotion
is
the
British
band
the
Arctic
Monkeys
who
are
the
first
band
to
become
famous
thanks
to
online
DIY
promotion.
The
Arctic
Monkeys
are
a
British
band
created
circa
2002
in
Sheffield,
England.
The
band
consists
of
Alex
Turner,
Jamie
Cook,
Nick
O’Malley
and
Matt
Helders.
Besides
being
a
well‐known
British
pop
band,
the
Arctic
Monkeys
are
known
in
the
industry
for
being
responsible
for
the
breakthrough
in
online
promotion.
In
an
interview
with
the
band
in
2005,
the
question
of
their
online
is
being
discussed.
Alex
Turner,
the
singer,
explains
that
the
Internet
played
a
big
part
in
their
success.
It
all
started
after
their
first
concerts
back
in
2003
when
they
had
already
recorded
tracks
and
burned
CDs
that
they
would
distribute
for
free
at
the
end
of
concerts,
doing
their
own
promotion.
Because
those
tapes
were
obviously
in
limited
editions,
fans
started
to
copy
them
onto
their
computers
and
share
them
on
the
Internet.
This
know
could
be
regarded
as
high
risk
because
of
copyright
infringement
but
the
Arctic
Monkeys
did
not
know
about
it,
were
young
and
just
wanted
to
please
their
fans.
Turner
even
said,
“the
band
did
not
mind,
they
never
did
it
to
make
money
or
anything
anyway.
They
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
18
were
giving
them
away
for
free
–
it
was
a
better
way
for
fans
to
listen
to
the
songs
and
sing
along
at
concerts”19
Another
reason
they
recall
that
helped
a
lot
is
two
specific
fans.
Those
two
fans
were
putting
up
songs
on
the
Internet
and
created
a
profile
on
a
new
social
media
website
called
MySpace.
The
Arctic
Monkeys
themselves
did
not
know
about
MySpace.
The
Arctic
Monkeys
were
the
first
example
of
DIY
music
promotion.
According
to
Laura
Barton,
a
Guardian
journalist,
the
Arctic
Monkeys
are
an
“Internet
phenomenon
that
allowed
the
Sheffield
four‐piece
to
flourish
despite
not
receiving
much
airplay”20,
airplay
traditionally
being
the
key
to
being
known.
The
reason
why
it
worked
so
well
is
because
the
Arctic
Monkeys
responded
to
what
their
fan
base
wanted.
It
had
become
even
harder
for
unknown
band
to
get
a
record
deal
without
their
own
promotion
and
therefore
it
was
hard
for
them
to
reach
a
wide
base.
However
by
making
their
song
available
on
MySpace,
the
band
did
not
just
allow
fans
to
listen
but
also
to
download
and
track
their
whereabouts
through
the
most
useful
feature
on
MySpace:
blogs.
Tour
dates
are
announced,
comments
can
be
left
to
other
“friends”
and
everybody
can
“follow”
what
the
Arctic
Monkeys
are
doing.
Their
success
and
fame
spread
like
wildfire
around
England
and
soon
became
number
one.
Nowadays,
the
release
of
their
first
album
“Whatever
people
say
I
am
that’s
what
I
am
not”
is
known
to
be
the
fastest
selling
debut
album
in
the
UK
selling
363,735
copies
in
the
first
week.
This
outnumbered
the
previous
record
of
3036,631
copies
sold
by
the
band
Hear’Say,
and
it
sold
more
copies
on
its
first
day
118,501
copies,
than
the
Top
20
albums
of
that
week
combined.
A
music
retailer
from
HMV
even
compared
this
success
to
the
one
of
the
Beatles:
“In
terms
of
sheer
impact,
where
a
band
has
come
from
virtual
obscurity
to
achieve
huge,
overnight
success,
we
haven't
seen
anything
quite
like
this
since
the
Beatles”
21.
Since
then,
the
band
signed
on
Domino
Records
and
their
album
Whatever
People
Say
I
am
That’s
What
I
am
Not
came
fifth
in
NME’s
greatest
British
album
poll.
19
Arctic
Monkeys
aren’t
fooling
around.
Prefixmag
Interview.
November
21,
2005.
Retrieved
on
March
8th
on
http://www.prefixmag.com/features/arctic‐monkeys/arent‐fooling‐around‐part‐1‐of‐2/12565/
20
Barton,
Laura.
The
Question:
Have
the
Arctic
Monkeys
changed
the
music
business?.
The
Guardian
online.
Retrieved
from
http://www.guardian.co.uk/music/2005/oct/25/popandrock.arcticmonkeys
on
March
8th
21
Arctic
Monkeys
make
UK
charts
history.
The
Guardian
Online.
Retrieved
from
http://www.guardian.co.uk/uk/2006/jan/30/arts.artsnews on March 8th
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
19
The
reason
behind
this
success
is
definitely
due
to
an
increase
in
the
use
of
technologies.
Stephen
McRobbie
of
the
Pastels
(a
Domino
band)
suggests
that:
The
music
industry
has
become
less
predictable
as
a
result
in
the
recent
months.
It
is
very
difficult
for
major
labels
to
understand
what’s
going
on,
and
they
never
really
understood
the
whole
downloading
phenomenon.
Things
have
gone
really
out
of
control,
and
it
has
suited
labels
that
are
smaller
and
can
react
much
quicker.22
Laura
Barton,
to
explain
the
phenomenon,
coined
the
term
“musical
socialism”
to
describe
the
fact
that
“this
is
the
beginning
of
a
music
putsch
for
the
major
labels
have
failed
to
engage
with
or
prescribe
to
music‐lovers.
The
simple
fact
that
the
Internet
allows
a
fledging
band’s
music
to
be
heard
without
label
assistance”23.
2.3 AFTERMATH ON TODAY’S INDUSTRY
2.3.1 CUSTOMER BASE
Every
industry
is
facing
a
change
of
their
customers’
behavior.
More
and
more
people
are
spending
time
online
and
less
offline.
On
April
23,
2007
Advertising
Age
released
a
supplement
to
its
issue
called
“Digital
Marketing
&
Media
Fact
Pack”.
Through
this
issue
we
understand
thanks
to
many
statistics
that
the
entire
business
world
is
affected
by
a
digital
revolution.
Between
2006
and
2007,
the
first
websites
in
major
categories
(see
exhibit)
all
increased
the
number
of
their
visitors
by
an
average
of
18.175%
with
categories
Classifieds
and
Social
Networking
increasing
by
87.6%
and
72.5%
respectively.
Blog
ad
spending
in
2005
was
$16.6
million,
it
is
estimated
to
be
$300.4
million
in
2010.
Blogs
attract
57
million
of
readers
(38.77%
of
the
US
Internet
Population)
daily
and
the
ROI
on
blogging
was
61%
in
2006
according
to
Forrester
Research.
Download
music
is
the
top
11
online
activity
for
users
with
15.7%
responding
(23.3%
increase
since
2005).
Radio
is
number
17
with
10.9%.
22
McRobbie,
Stephen.
Record
Labels,
the
Domino
Effect.
The
Independent
Online.
Retrieved
on
March
8th
on
http://www.independent.co.uk/arts‐entertainment/music/features/record‐labels‐the‐domino‐effect‐525404.html
23
Barton,
Laura.
See
note
20
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
20
We
admitted
that
the
biggest
use
of
Internet
for
music
was
through
social
networking
websites.
According
to
the
same
Ad
Age
report,
55%
to
18
to
34
years
old
Internet
users
admitted
that
they
would
not
be
able
to
keep
in
touch
with
friends
without
social
networks
and
new
technologies,
showing
a
real
potential
for
growth.
With
Facebook
Pages
you
can
appear
in
Google
Search,
or
47.5%
of
the
search
engine
market
share.
The
fact
is,
customers’
behavior
is
changing.
People
are
spending
more
time
on
the
Internet
and
it
is
now
the
place
where
you
can
get
the
most
visibility.
This
is
why
other
traditional
media
are
decreasing
and
there
is
such
an
opportunity
for
unknown
persons
to
became
Internet
heroes.
A
small
band
from
Connecticut
can
find
itself
being
very
famous
in
Lyon
without
ever
having
set
foot
there.
2.3.2 IMPORTANCE OF TRADITIONAL MEDIA AT STAKE
When
we
look
at
what
is
available
to
bands
or
record
labels
for
promotion
it
is
easy
to
ask
how
are
traditional
media
doing
in
the
midst
of
this
revolution.
According
to
Zenith
Optimedia
(part
of
Publicis),
Global
Advertising
Expenditure
since
2005
has
increased
from
$19,235
million
to
$48,139
million
for
the
Internet
alone
when
the
overall
US
advertising
expenditure
has
increased
from
$399,431
million
to
$504,557.
This
means
that
Internet
went
from
representing
4.8%
of
total
US
spending
to
being
9.5%
in
just
4
years.
On
the
other
hand,
newspapers
advertising
dropped
from
representing
29.7%
in
2005
to
26.2%
in
2009.
While
television
still
continued
to
increase,
the
steepness
of
the
increase
curve
is
much
smaller
than
Internet,
growing
from
37.8%
to
38.1%,
stagnating
in
2006
and
2007.
Magazines
advertising
dropped
too
to
12.1%
in
2009
(13.2%
in
2005).
See
exhibit
for
a
complete
overview
of
US
advertising
spending
between
2005
and
2009.
What
is
important
to
note
here
is
that
more
and
more
advertising
is
done
digitally.
This
means
that
now
record
labels
have
to
be
able
to
respond
to
this
change
or
they
will
not
be
able
to
reach
their
target.
As
seen
up
above,
customer
behavior
is
changing
as
well,
with
more
and
more
people
spending
time
on
the
Internet
or
their
mobile
devices.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
21
2.3.3 DIY
MUSIC
PROMOTION
As
seen
up
above,
the
Internet
offers
many
tools
for
self‐promotion.
The
Arctic
Monkeys
showed
it
well
and
websites
such
as
SonicBids,
Last.Fm
or
even
Youtube
or
Facebook
allow
an
artist
to
promote
himself
simply
and
most
of
the
time
free
of
charge
from
everywhere
in
the
world.
This
reflects
the
overall
trend
that
is
true
for
every
business,
technological
globalization
has
made
the
world
flatter
and
broke
down
geographical
boundaries.
When
looking
back
at
the
flowchart
of
the
standard
marketing/manufacturing
process
in
the
music
industry
(exhibit
1),
we
can
reevaluate
the
impact
that
such
a
possibility
has
on
the
industry.
The
A&R
part
can
be
deleted
when
an
artist
can
use
SonicBids
to
get
himself
to
the
promoter
or
do
his
own
promotion.
All
that
happens
in
the
store
is
also
easily
deleted
when
the
promotion
works
so
successfully
online.
The
role
of
record
labels
is
diminished
because
of
the
DIY
music
promotion.
However,
did
new
technologies
diminish
the
impact
of
record
labels
in
terms
of
distribution?
3.1 DIGITAL DISTRIBUTION
3.1.1 WHAT IS DIGITAL MUSIC AND HOW IMPORTANT IS IT IN THE INDUSTRY
Webster’s
Dictionary
defines
digital
as:
“characterized
by
electronic
and
especially
computerized
technology”.
Distribution
is
the
“marketing
or
merchandising
of
products
or
commodities”24.
Therefore
digital
music
distribution
is
considered
to
be
the
sale
of
music
merchandise,
that
is
to
say
songs,
album
or
even
image,
over
the
Internet.
On
a
financial
standpoint,
any
revenue
that
is
made
through
such
distribution
is
accounted
for
“digital
sales”
on
the
balance
sheet,
to
differentiate
from
“physical
sales”
such
as
pressed
CDs
in
retail
stores.
24
Webster’s
Dictionary
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
22
To
purchase
digitally,
people
can
“acquire
tracks
and
albums
in
ways
inconceivable
a
few
years
ago
–
from
download
stores,
streaming
sites,
subscription
services,
free‐to‐
user
sites,
bundled
with
their
broadband
or
mobile
phone
handset”25.
In
the
period
2004‐2009
digital
sales
increased
by
940%
when
the
total
music
market
decreased
by
30%.
It
now
accounts
for
27%
of
the
entire
music
revenue
(40%
in
the
US),
only
second
biggest
share
after
the
gaming
industry
whose
digital
revenue
accounts
for
32%
of
its
total
revenue.
According
to
the
IFPI,
in
2003
there
were
less
than
50
licensed
music
services,
versus
more
than
400
in
2009.
The
catalogue
available
in
2003
was
ten
times
smaller
than
the
one
available
now
and
the
industry’s
digital
revenue
was
only
$20
million
(less
than
1%)
versus
$4.2
billion
in
2009.26
The
opportunity
for
consumers
now
is
that
music
is
available
in
much
more
format
that
it
used
to.
In
the
last
decades,
an
album
would
be
available
only
in
a
few
formats.
Nowadays
with
ringtones,
mastertones,
waiting
tones,
audio
tracks,
online,
offline
and
so
much
more,
an
album
can
be
found
in
hundreds
of
different
format.
As
an
example,
Beyoncé’s
I
am…
Sasha
Fierce
is
available
in
more
than
260
different
products
in
the
US.
There
are
also
many
different
business
models
that
we
are
going
to
study.
3.1.2 THE BUSINESS MODELS OF DIGITAL DISTRIBUTION
Alacarte
downloads
account
for
the
major
revenue
stream
of
digital
sales.
According
to
the
IFPI
there
were
three
key
developments
in
2009:
more
DRM‐free
services,
growth
in
digital
album
offerings
and
the
introduction
to
variable
pricing.
Music
companies
have
expanded
their
DRM‐free
catalogue
which
means
that
more
than
ever
consumers
can
purchase
a
song
and
transfer
it
to
as
many
devices
as
wished,
which
used
not
to
be
the
case
as
iTunes
for
example
limited
the
distribution
to
5
devices.
Variable
pricing
means
discounting
the
catalogue
relative
to
the
top
charting
tracks
helped
convert
single‐track
purchases
into
album
sales.
Also,
some
companies
have
increased
the
quality
of
their
offering
to
attract
consumers.
iTunes
for
example
is
now
offering
iTunes
LP,
a
deluxe
digital
format
that
Apple
describes
as
follows:
25
Kennedy,
John.
Chairman
&
Chief
Executive
IFPI.
Music
how,
when,
where
you
want
it
–
but
not
without
addressing
piracy.
Digital
Music
Report
2010.
p.3
26
IFPI.
Report
on
Digital
Music
2010.
Retrieved
on
March
9th
from
http://www.ifpi.org/content/library/DMR2010.pdf
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
23
The
best
thing
to
happen
to
fandom.
The
visual
experience
of
the
record
album
returns
with
iTunes
LP.
Download
select
albums
and
experience
a
beautifully
designed,
interactive
world
right
in
your
iTunes
library
on
a
Mac
or
PC
—
many
are
created
by
the
artists.
While
you
listen
to
your
favorite
songs,
you
can
dive
into
animated
lyrics
and
liner
notes,
watch
performance
videos,
view
artist
and
band
photos,
and
enjoy
other
bonus
materials.
And
become
an
even
bigger
fan.27
The
innovation
by
Apple
is
a
very
important
step
that
perfectly
responds
to
the
main
critic
made
about
digital
albums:
that
we
cannot
experience
the
pleasure
linked
to
buying
a
physical
album
and
flipping
through
the
booklet
or
the
CD
case.
(See
exhibit
for
a
screengrab
of
an
iTunes
LP
album).
ISP
and
mobile
partnerships
is
the
act
of
offering
music
downloads
as
a
bundle
with
the
purchase
of
a
mobile
or
broadband
plan.
ISP
are
looking
into
doing
this
much
often
as
their
market
is
saturating
and
it
is
becoming
much
more
difficult
to
differentiate
themselves
among
the
competition.
In
order
to
do
so
they
try
to
partner
with
music
companies.
In
Denmark
for
example,
TDC’s
Play
is
a
service
offered
by
the
ISP
TDC
that
opens
their
customers’
access
to
a
6.1
million
tracks
catalogue
that
can
be
streamed
unlimitedly
at
no
additional
cost.
In
the
UK,
Sky
Song,
a
service
from
the
company
Sky,
offers
to
stream
over
4
million
tracks
with
packages
of
10
to
15
downloads
per
month.
Music
subscription
with
bundled
with
devices
is
the
offering
of
songs
through
the
purchase
of
a
mobile
device.
Nokia
and
Sony
Ericsson
have
started
doing
this
in
2008.
It
usually
allows
downloading
of
songs
on
the
mobile
device.
Streaming
services
as
a
business
model
is
paying
for
premium
services
on
streaming
websites
such
as
Deezer
or
Spotify.
On
Spotify
for
example,
users
can
pay
€9.99
to
stream
the
music
on
portable
handsets
and
have
no
advertising.
On
Deezer,
users
can
pay
€4.99
per
month
to
remove
advertising
and
receive
higher
quality
streaming
or
27
www.apple.com
What’s
New
in
iTunes.
Retrieved
on
March
9th
from
http://www.apple.com/itunes/whats‐
new/#itunes‐lp
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
24
€9.99
to
add
a
desktop
app
and
mobile
streaming
to
phones
such
as
iPhone,
Blackberry
or
Android.28
Monetizing
music
videos
online
means
getting
revenue
from
music
videos
streaming.
In
December
2009,
Universal
Music
Group
and
Sony
Music
Entertainment
partnered
with
video
websites
such
as
YouTube
to
launch
VEVO
in
the
US
and
Canada.
It
is
focused
on
ad‐supported
distribution
of
videos
to
generate
revenue
as
recognized
how
important
the
potential
was.
In
Europe
for
example
watching
videos
on
Youtube
accounts
for
31%
of
the
Internet
activity.
The
advantage
with
VEVO
is
that
it
distributes
professional
music
videos,
in
a
world
where
quality
is
becoming
more
and
more
important.
Everything
is
made
for
the
customer
to
have
a
better
experience
watching
videos
on
VEVO,
including
links
to
artist
websites,
high‐quality
premium
player
and
professionalism.
Hulu,
another
video
provider
already
offers
premium
quality
concerts
and
music
videos.
Recently,
MySpace
has
launched
MySpace
Music
Videos.
Direct
to
consumer
means
having
consumers
buying
a
premium
membership
to
access
an
artist’s
website
and
receive
premium
features
such
as
blogging
from
the
artist.
3.1.3 ITUNES, LEADER OF THE INDUSTRY
All
those
different
business
models
allow
companies
that
would
not
have
been
considered
in
the
industry
back
in
the
physical
age,
to
flourish
tremendously
as
vendors.
iTunes
Music
Store
is
nowadays
considered
the
leader
in
the
music
industry
with
more
than
10
billion
songs
downloaded
from
iTunes,
as
announced
on
Apple’s
official
website
and
sales
accounting
for
25%
of
the
overall
music
market29.
As
announced
before,
iTunes
offers
to
download
songs
by
the
unit,
albums,
but
also
iTunes
LPs,
music
videos,
TV
shows,
movies
or
iPhone/iPod
apps.
What
is
remarkable
is
that
Apple
is
not
a
music
company,
its
business
model
is
not
originally
based
on
selling
songs
and
yet
in
less
than
6
years
(iTunes
Music
Store
was
launched
in
2003)
they
managed
to
top
the
charts
and
become
the
most
music
revenue
generating
company
in
the
US,
shortly
followed
by
Wal‐Mart,
Best
Buy
and
Amazon.
28
Bonanos,
Paul.
Deezer:
Another
startup
that
will
face
the
music
on
premium
streaming.
Retrieved
on
March
9th
from
http://gigaom.com/2009/11/05/deezer‐another‐startup‐that‐will‐face‐the‐music‐on‐premium‐streaming/
29
IFPI.
Digital
Music
Report
2010
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
25
iTunes
business
model
is
based
on
à‐la‐carte
services
where
consumers
can
create
an
account
once
and
then
download
as
many
songs
as
they
want,
paying
per
download
and
not
a
bundle.
The
tremendous
innovation
iTunes
made
on
the
music
store
are
DRM‐free
songs
(it
used
not
to
be
the
case)
and
variable
pricing.
Now,
6
millions
songs
are
available
DRM‐free
at
$0.69,
$0.99
or
$1.29.
Apple
also
offers
partnership
with
iTunes,
it
offers
two
kinds
of
partners
the
option
of
having
visibility
on
iTunes:
Content
providers
(record
labels
for
example,
that
can
benefit
from
Apple’s
marketing
program,
but
also
individuals),
companies
and
organizations
(helping
iTunes
through
marketing
efforts,
iTunes
Corporate
Gift
Cards.
By
becoming
an
iTunes
content
provider,
an
artist
has
access
to
iTunes
Producer,
a
software
dedicated
to
making
songs
ready
for
distribution
on
iTunes
(encoding
on
AAC
format,
including
album
name,
song
name
and
cover
art
information).
The
artist
also
has
access
to
Downloadable
financial
reports,
available
at
the
end
of
each
month
and
archived
through
the
last
12
months.
An
artist
is
also
entitled
to
Apple
discounts
and
the
access
to
iTunes
Label
Connect,
a
VIP
website
dedicated
to
making
it
easy
for
artist
to
sell
their
songs.
iTunes
then
offers
DIY
music
distribution.
Granted
it
might
be
more
difficult
for
a
solo
artist
or
band
to
be
completely
successful
in
distributing
its
songs
on
iTunes
faced
to
the
stiff
competition
of
promotion
sharks
that
labels
are.
However
it
allows
them
to
handle
everything
and
find
a
way
to
sell
their
songs
without
needing
a
record
deal.
Also
the
promotion
tools
offered
by
iTunes
for
content
providers
such
as
“Tell
a
Friend”
or
the
iTunes
Affiliate
Program
(allowing
for
example
to
place
badges
on
the
artist’s
website
linking
to
their
iTunes
page)
have
an
important
place
in
the
promotion
process
of
an
artist.
3.2 MUSIC PIRACY
Illegal
downloading
and
Music
Piracy
are
two
interchangeable
terms
in
this
situation.
It
is
the
act
of
getting
songs
on
the
Internet
while
violating
copyright
and
intellectual
property.
People
who
download
illegally
do
not
pay
for
the
songs
they
get
or
do
not
go
through
a
valid
and
legal
distribution
service
such
as
the
ones
described
above.
In
1999,
record
sales
started
to
decline,
a
first
after
a
steady
growth
for
over
ten
years.
1999
was
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
26
also
the
year
Napster
was
created.
Napster
was
the
first
P2P
software
that
people
would
use
to
pirate
music.
Both
the
IFPI
and
the
RIAA
believe
the
decline
and
the
arrival
of
P2P
are
highly
related.
It
is
argued
that
music
piracy
does
not
hurt
the
music
industry.
Indeed
even
though
it
is
proven
that
it
led
to
significantly
smaller
sales,
it
can
be
argued
that
without
music
piracy
and
the
growth
of
the
Internet,
people
would
not
have
access
to
as
much
music
as
they
do
now.
Both
sides
are
highly
confident
in
their
position
but
it
is
yet
important
to
wonder
what
are
the
real
effects
of
music
piracy
on
the
music
industry.
3.2.1 WHAT ARE THE EFFECTS ON THE INDUSTRY?
One
can
look
at
the
financials
of
the
music
industry
without
much
knowledge
to
notice
that
it
is
in
plain
decline.
Between
2004
and
2009,
revenue
decreased
by
30%.
According
to
the
Institute
for
Policy
Innovation,
Global
music
piracy
causes
$12.5
billion
of
economic
losses
every
year,
71,060
US
jobs
lost,
a
loss
of
$2.7
billion
in
workers’
earnings,
and
a
loss
of
$422
million
in
tax
revenue,
$291
million
in
personal
income
tax
and
$131
million
in
lost
corporate
income
and
production
taxes30
What
is
important
to
note
is
that
in
Siwek’s
study,
the
Sound
Recording
industry
comprises
both
producers
and
retailers.
Both
of
those
actors
suffer
from
piracy.
One
can
imagine
that
revenue
loss
from
piracy
is
equal
to
potential
gain
in
a
scenario
where
piracy
would
not
exist.
Another
study
from
the
IPI
(2006
Global
Recording
Industry
in
Numbers)
concludes
that
a
decrease
in
piracy
would
expand
production.
The
study
first
assesses
that
in
a
no
piracy
scenario,
competition
would
not
change
between
music
retailers
and
producers,
it
also
assumes
that
higher
revenues
would
allow
the
producers
to
increase
their
spending
in
sound
recording
equipment,
to
offer
better
quality
or
more
recordings
to
the
customers
as
they
face
a
stiff
competition.
Investing
in
higher
quality,
but
also
broadcasting,
marketing
and
retailing,
will
increase
production
in
other
industries
that
are
related
to
the
good
functioning
of
the
record
industry.
It
will
also
allow
producers
and
retailers
to
invest
more
in
the
discovery
of
new
artists
and
the
promotion
of
those,
thus
offering
a
wider
catalogue
to
the
people.
30
Siwek,
Stephen
E.
The
True
Cost
of
Sound
Recording
Piracy
to
the
US
Economy.
IFPI
Policy
Report.
August
21,
2007
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
27
The
opposite
is
therefore
true,
decreasing
revenues
caused
by
piracy
for
the
industry
implies
that
the
recording
industry
needs
to
cut
costs
and
has
less
money
for
investment
in
better
quality
recording
or
artists.
In
France
for
example
there
has
been
a
dramatic
change
in
the
introduction
of
new
artists.
In
the
first
half
of
2009
for
example
107
French
repertoire
albums
were
released,
versus
271
for
the
same
period
in
2003,
a
60%
decrease.
French
artists
discovery
has
plummeted
as
well,
going
from
91
in
the
first
half
of
2002
to
35
in
2009.
On
a
promotional
standpoint,
global
advertising
revenue
in
the
French
recording
industry
decreased
by
9%
in
the
first
6
months
of
2009.
It
is
admitted
that
25%
of
the
French
population
uses
P2P
networks
to
get
their
music
monthly.31
In
Spain
it
is
even
worse
where
illegal
file
sharing
is
an
activity
for
32%
of
the
population.
The
European
rate
is
15%32
Digital
music
business
models
such
as
the
iTunes
Music
Store
offer
to
download
songs
at
an
average
of
$0.99,
a
price
that
is
now
considered
extravagant
by
many,
according
to
Teemu
Brunila
(singer‐songwriter
interviewed
in
the
IFPI
report
on
Digital
Music).
On
the
other
hand
the
IFPI
estimated
that
in
2005
alone,
more
than
20
billion
songs
were
download
illegally,
or
twice
as
much
as
legal
downloads
on
the
iTunes
Music
store
in
6
years.
The
effect
on
the
music
industry
is
highly
costly
for
the
retailers
and
the
producers.
On
the
other
hand,
as
mentioned
above,
people
can
argue
that
music
piracy
has
broadened
the
catalogue
offered
to
customers.
It
is
especially
a
study
from
Oberholzer
and
Strumpf
in
2006
that
showed
that
not
only
is
there
is
zero
impact
on
record
sales
due
to
music
piracy
but
also
that
music
piracy
might
boost
sales.
The
reflection
they
follow
is
that
music
piracy
forced
a
decrease
in
price
offering
to
the
customer,
therefore
boosting
the
interest
of
listening
to
new
artists.
“Observing
that
people
consume
lots
and
lots
at
zero
dollar
makes
sense
to
an
economist”
Oberholzer
says.
The
idea
behind
their
study
is
that
on
an
emotional
standpoint,
music
piracy
is
helping
the
industry33.
They
also
argue
that
the
decline
in
record
sales
is
not
due
to
an
increase
in
file
sharing.
Indeed
they
believe
that
this
fall
can
be
linked
with
“poor
macroeconomic
conditions,
a
31
Jupiter
Research
and
IFPI
Digital
Music
Report.
2009.
Retrieved
on
March
10
from
http://www.ifpi.org/content/library/DMR2010.pdf
page
19.
32
IFPI
33
Oberholzer‐Gee,
Felix
and
Strumpf,
Koleman.
The
effect
of
file
sharing
on
record
sales.
Harvard
Business
School.
2004
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
28
reduction
in
the
number
of
album
releases,
growing
competition
from
other
forms
of
entertainment
such
as
video
games
and
DVDs,
a
reduction
in
music
variety
stemming
from
the
large
consolidation
in
radio
along
with
the
rise
of
independent
promoter
fees
to
gain
airplay,
and
possibly
a
consumer
backlash
against
record
industry
tactics.”
Chapter
26
of
the
study
also
argues,
“a
similar
drop
in
record
sales
occurred
in
the
late
1970s
and
early
1980s,
and
that
record
sales
in
the
1990s
may
have
been
abnormally
high
as
individuals
replaced
old
recordings
with
newer
formats”.34
While
the
study
is
widely
discredited
and
more
papers
tried
to
counteract
their
findings,
people
can
argue
that
on
a
cultural
standpoint,
music
piracy
has
helped
the
industry
as
people
had
the
possibility
to
listen
to
many
more
artists
because
they
did
not
pay
for
it.
For
artists
this
has
been
of
a
tremendous
help
as
the
Arctic
Monkeys
example
shows.
On
the
other
hand
it
is
not
deniable
that
record
sales
have
plummeted
and
that
it
can
in
part
be
due
to
an
increase
in
file
sharing.
The
IFPI,
the
RIAA
and
co‐operatives
of
artists
have
recently
launched
a
backlash
against
illegal
file
sharing,
on
the
grounds
that
it
attacked
intellectual
property
and
was
leading
to
a
more
difficult
terrain
in
the
creative
industries.
3.2.2 WHAT WERE THE RESPONSES?
Most
recent
responses,
according
to
the
IFPI,
are
cooperation
between
labels
and
ISPs.
According
to
a
2009
study
by
Entertainment
Media
Research,
45%
of
consumers
said
they
would
stop
downloading
illegally
if
a
graduate
response
model
was
implemented.
The
graduate
response
model
is
a
model
that
has
three
main
actors:
the
individual,
the
ISP
and
the
rights
holders.
An
individual
caught
practicing
music
piracy
would
receive
a
first
warning
by
its
ISP,
advising
them
to
stop
infringing
copyright
and
suggest
the
use
of
other
legitimate
models
such
as
à‐la‐carte
programs
that
respect
copyrights
and
accordingly
rewards
the
rights
holder
(i.e.
the
artist).
If
such
a
warning
were
to
be
ignored,
an
escalating
series
of
warning
from
the
ISP
would
be
launched,
eventually
leading
to
a
temporary
account
suspension.
Differentiating
from
major
lawsuits
that
already
occurred
and
proved
to
have
no
effects,
the
graduate
response
model
would
protect
to
anonymity
of
the
individuals.
In
France,
a
study
from
IPSOS
conducted
in
May
34
Pollock,
Rufus.
P2P,
Online
FileSharing,
and
the
music
industry.
2(1).
2005.
Retrieved
on
March
10
from
http://www.rufuspollock.org/economics/p2p_summary.html#id21000960
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
29
2008
concluded
that
90%
of
French
people
would
completely
stop
illegal
file
sharing
after
receiving
a
second
warning
from
their
ISP.
France
itself
was
an
early
champion
in
implementing
the
graduate
response
model.
In
October
2009,
a
new
authority
was
implemented,
the
HADOPI.
The
authority
will
require
ISP
to
send
warnings
to
their
users
for
copyright
infringement.
HADOPI
will
then
transfer
the
files
of
recidivists
(after
a
second
warning
being
ignored)
to
the
criminal
courts
where
judges
(not
ISP)
would
then
decide
on
multiple
sentences
such
as
suspension
of
Internet
access
for
up
to
a
year
and
a
full
range
of
criminal
penalties.35
Similar
actions
have
been
taken
in
South
Korea
and
Taiwan
and
are
going
to
be
taken
in
Germany,
the
UK,
New
Zealand,
Ireland,
Australia,
Hong
Kong,
Brazil
and
Japan.
Concerning
the
US,
the
IFPI
states
that
“private
deals
have
been
struck
between
some
individual
rights
holders
and
ISPs
that
incorporate
a
commitment
by
the
ISP
to
put
in
place
a
system
of
graduated
response”36
South
Korea
is
a
really
good
example
of
good
response
towards
illegal
downloading.
They
passed
their
law
concerning
graduate
response
system
in
April
2009.
Soribada,
an
illegal
P2P
website
was
subject
to
legal
actions
for
copyright
infringement
as
early
as
2007
and
then
turned
legitimate
by
charging
its
consumers.
Also
South
Korea
became
one
of
the
first
countries
in
the
world
to
require
P2P
file‐sharing
websites
to
completely
ban
the
illegal
distribution
of
copyrighted
work
on
request
from
the
right‐holder
(and
not
necessarily
the
record
label).
Also,
in
2008,
legal
unlimited
MP3
subscription
services
began
to
flourish.
Now
major
players
like
Soribada
and
M.Net
Media
all
offer
those
services
for
a
fee.
Three
websites
in
South
Korea:
Soribada,
M.Net
Media
and
Neowiz
Bug
total
a
number
of
990,000
subscribers
to
their
services.
Just
for
Soribada,
300,000
of
its
700,000
illegal
consumers
switched
to
the
legal
format,
which
shows
a
strong
positive
response
from
the
consumers.
A
situation
that
worries
the
industry
is
the
leaks
prior
the
release
of
an
album.
Graduate
Response
model
can
tackle
illegal
downloading
as
it
is,
through
P2P
but
the
IFPI
and
the
record
labels
agree
that
major
actions
have
to
be
taken
in
terms
of
securing
the
release
of
an
album
to
avoid
pre‐release
tracks
to
be
available
on
the
Internet.
One
action
35
Loi
N°2009669
du
12
juin
2009
favorisant
la
distribution
et
la
protection
de
la
creation
sur
Internet.
Retrieved
on
March
10
from
http://www.legifrance.gouv.fr/affichTexte.do?cidTexte=JORFTEXT000020735432&categorieLien=id#JORFARTI0000
20735439
36
IFPI.
Digital
Music
Report
2010.
P.
25
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
30
considered
as
an
example
by
the
industry
is
related
to
the
release
of
Leona
Lewis’
album
in
2009.
An
Internet
account
at
her
record
company
was
hacked
and
her
songs
were
posted
online
prior
to
the
release.
Syco
Records
(her
record
label)
upon
notification
of
the
fraud
called
in
the
police
and
investigators
and
was
able
to
track
back
the
hacker
in
North
America
and
Europe.
Even
though
if
we
see
some
encouraging
results,
the
battle
is
yet
not
over
and
as
Jonas
Sjöström
from
Playground
Music
puts
it:
“There
is
now
positive
news
but
our
whole
sector
is
still
at
risk”.
On
another
level,
prevention
seems
to
be
the
new
trend.
Education
is
being
implemented
in
different
countries,
either
by
informing
people
about
the
law,
but
also
teaching
them
how
to
legally
get
music.
The
IFPI
for
example
has
made
available
DFC
(Digital
File
Check)
to
inform
people
on
how
computer
users
can
legally
and
safely
download
music.
The
software
also
implies
to
the
customer
both
legal
and
technological
risks
for
them.
However
a
Harris
Research
concluded
that
increasing
familiarity
with
the
law
has
not
shown
to
have
reduced
file
sharing
and
that
it
has
to
be
associated
with
the
“carrot”
in
a
“carrot
and
the
stick”
scenario
to
entice
people
to
go
towards
legal
file
sharing
services.
To
support
that
finding,
a
European
Union
2007
Report
called
“Safer
Internet
for
the
Children”
dedicates
an
entire
part
to
illegal
downloading.
Its
conclusions
are
that
in
the
vast
majority
of
the
cases,
children
know
downloading
is
illegal
but
their
response
is
to
minimize,
deny
or
justify
it.
Frequent
quotes
from
the
report
are
the
following:
• “It’s
illegal
but
it
does
not
look
it’s
illegal”
(Boys
group,
12‐14
years,
Denmark)
• “It’s
wrong
but
it’s
not
our
fault”
(Girls
group,
12‐14
years,
Belgium)
• “People
download
but
it’s
just
for
themselves,
it
is
less
serious
than
downloading
for
burning
and
reselling”
(Boys
group,
12‐14
years,
France)
• “I
really
don’t
care,
it’s
not
my
problem,
artists
are
rich
enough”
(All
groups,
Italy)
Also
another
conclusion
at
the
end
of
the
day
is
that
the
risk
of
catching
a
virus
on
their
computer
is
more
dissuasive
than
legal
repercussions,
as
most
do
not
believe
such
a
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
31
thing
will
happen
but
have
witnessed
“friends
having
viruses
because
they
downloaded”.37
3.2.3 WHAT ARE THE NEXT STEPS?
According
to
Sjöström,
the
good
recipe
for
a
sturdier
industry
is
a
combination
of
user‐
friendly
legal
solutions
to
downloading
and
a
deterrent
response
to
piracy.
The
law
really
has
to
be
enforced
to
avoid
people
thinking
they
will
never
get
caught,
as
it
seems
to
have
been
the
case
in
the
past.
Also
what
is
important
is
to
have
higher
investment
and
cooperation
from
labels
and
governments
to
allow
the
offering
of
a
much
wider
catalogue.
Also
the
government
has
to
put
more
pressure
on
the
ISPs
to
be
sure
they
implement
the
graduate
response
model
as
should
be.
Education
is
also
very
important,
people
have
to
be
aware
of
how
big
the
effects
are
on
the
industry
and
that
they
are
being
lured
by
the
impression
of
“free”
products.
Even
though
people
think
they
are
getting
free
music
and
it
is
fine
by
them,
they
have
to
know
that
it
harms
the
industry
not
only
financially
but
also
because
in
the
long
run
much
less
artists
are
going
to
be
able
to
be
invested
in
because
of
a
lack
of
subvention
due
to
decreased
revenue
which
will
eventually
lead
to
a
dramatic
decline
in
the
industry,
more
“mainstream”
to
sell
more
and
less
choice
that
will
satisfy
the
music‐lovers.
3.3 EFFECT
ON
THE
ROLE
OF
RECORD
LABELS
IN
TERMS
OF
DISTRIBUTION
As
seen
above,
the
new
technologies
have
impacted
the
industry
in
many
different
ways.
Artists
can
distribute
themselves
without
needing
a
record
deal
as
long
as
they
target
digital
sales.
The
cost
of
it
is
much
less
important
than
to
produce
a
physical
album,
indeed
the
only
cost
they
encounter
is
the
recording
cost.
When
we
look
back
at
the
flow
chart
in
exhibit
1,
it
suppresses
the
need
to
press
and
package
a
CD,
all
is
done
digitally
and
a
track
can
virtually
be
distributed
to
every
single
person
on
Earth
without
facing
a
risk
of
not
having
enough
supplies.
In
the
same
situation,
the
artists
or
the
labels
that
choose
to
concentrate
on
an
all‐digital
format
do
not
have
to
go
through
physical
retail
store.
iTunes
Music
store
offers
a
good
solution
to
those
who
can
concentrate
on
an
all‐
digital
offering
and
this
is
why
the
iTunes
Music
store
has
benefited
so
much
from
the
37
Safer
Internet
for
the
Children.
2007.
European
Union
Report.
Retrieved
on
March
10
from
http://ec.europa.eu/public_opinion/quali/ql_safer_internet_summary.pdf
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
32
increase
in
digital
sales
and
is
likely
to
be
responsible
for
this
increase.
New
technologies
have
allowed
people
to
get
a
quicker
access
to
music
and
also
a
much
wider
access.
On
the
traditional
format
of
distribution,
a
CD
would
not
have
been
offered
in
a
market
if
the
demand
were
not
here.
On
the
digital
format
of
distribution
the
demand
is
limitless
and
there
is
virtually
only
one
market:
the
online
market.
Another
advantage
of
the
digital
format
is
being
able
to
offer
the
purchase
of
single
tracks,
the
à‐la‐carte
format.
To
do
so,
traditional
distribution
systems
were
releasing
“Singles”
based
on
popularity,
thus
reducing
the
capacity
of
a
record
labels
to
respond
to
the
entire
demand
and
being
accused
of
being
too
mainstream.
On
the
other
hand
it
has
been
shown
that
new
technologies
have
not
successfully
been
controlled
and
led
to
a
dramatic
threat
for
the
industry
that
is
piracy.
This
badly
hurt
the
industry
as
show
the
statistics
proving
a
decrease
in
revenue,
it
has
also
forced
music
industry
players
to
start
prosecute
its
own
customers,
not
being
the
best
customer‐
friendly
industry
there
is.
Fortunately,
measures
are
being
taken
to
save
the
industry
and
the
artists’
intellectual
property.
Doing
so
is
a
much‐needed
action
to
sustain
the
creative
industry.
4 PART THREE – THE ROLE OF RECORD LABELS AT STAKE
4.1 MUSIC
PIRACY
IS
NOT
RESPONSIBLE
FOR
THE
LATE
FALL
OF
THE
INDUSTRY
It
is
a
fact;
the
music
industry
has
suffered
recently.
Its
revenue
decreased
by
30%
in
5
years
after
a
steady
growth
over
a
decade.
The
releases
per
year
are
shrinking
as
the
French
example
shows
and
some
might
even
say
that
the
quality
decreased
as
well,
this
probably
due
to
less
money
and
therefore
less
possibility
to
invest
in
new
artists
and
improvement
in
recording,
promotion
and
distribution
quality.
However
we
have
seen
that
revenue
from
digital
sales
has
increased
by
940%
and
is
now
accounting
for
25%
of
the
total
revenue
of
the
industry
in
the
United
States
of
America
and
for
little
less
than
10%
in
other
main
countries
(France,
Germany,
the
United
Kingdom
and
Japan
as
shown
in
the
Introduction).
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
33
Most
professionals
will
argue
that
this
is
due
to
the
new
technologies
and
the
pike
in
music
piracy
but
also
an
increase
in
DIY
music
creation,
promotion
and
distribution.
Others
will
say
it
is
an
overall
trend
for
the
entertainment
industry
that
relates
to
a
general
economic
downturn.
4.1.1 LESS MONEY = LESS SPENT ON ENTERTAINMENT
It
is
widely
accepted
that
in
the
scenario
of
an
economic
downturn,
people
will
start
saving
money
on
their
entertainment
expenses.
When
the
industry
declined
in
the
late
70s
and
early
80s,
this
was
due
to
two
economic
shocks.
In
the
US
alone
the
GDP
in
1982
declined
by
1.82%
compared
to
1981.
In
the
90s,
when
the
industry
recorded
a
steady
growth,
the
GDP
growth
had
an
average
increase
of
3%
per
year
and
even
peaked
at
4.55%
in
97.
However,
the
GDP
growth
rate
of
the
US
since
2004
has
been
in
decline
with
increase
by
3.65%
in
2004
but
then
only
3.08%,
2.87%,
2%
and
1.1%
in
2008.
In
2009
alone
it
decreased
by
2.4%38.
The
trend
is
similar
for
France,
which
registers
a
2.1%
decrease
in
2009,
Germany
with
a
5%
decrease
or
the
UK
with
a
4.3%
decrease.
Exhibit
shows
the
overall
trend
between
the
5
main
players
in
the
industry:
Japan,
Germany,
France,
the
US
and
the
UK,
with
respect
to
the
overall
world’s
trend.
A
study
released
by
Nielsen
on
February
22,
2010
shows
that
buying
CDs,
MP3s
or
other
forms
of
music
only
represents
2.8%
of
the
global
spending
on
entertainment
by
the
average
American
household.
If
the
GDP
is
decreasing
and
people
have
less
money
it
is
likely
that
the
recording
industry
is
going
to
suffer
from
it
as
less
people
will
have
the
financial
capability
to
spend
as
much
as
they
used
to
in
the
90s.
As
an
example,
the
US
Department
of
Labor
released
a
study
concluding
that
entertainment
spending
was
about
4%
in
the
1950s
and
1960s,
then
increased
to
8.6%
in
1972
(a
record
high)
to
finally
drop
at
a
level
of
5%
since
1984.39
Another
trend
showed
by
the
Consumer
Expenditure
Survey
is
that
since
1999
annual
spending
for
the
Internet
soared,
implementing
an
expense
than
most
people
did
not
have
ten
years
from
today.
In
1999
the
average
annual
spending
for
Internet
access
was
$49,
it
is
now
$222.
38
CIA
World
Factbook.
39
Bureau
of
Labor
Statistics.
The
Consumer
Expenditure
Survey.
Retrieved
on
March
11
from
http://www.bls.gov/cex/ceturnsthirty.htm. 2009
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
34
Comparatively,
newspapers
and
magazine
spending
went
from
$97
to
less
than
$61.40
When
we
know
that
consumer
spending
on
newspapers
and
magazines
is
1.25
times
higher
than
recorded
music41,
it
is
easy
to
realize
how
two
factors
led
to
a
decrease
in
consumer
spending
on
recorded
music:
higher
spending
on
the
Internet,
but
also
housing,
personal
insurance,
healthcare42
and
a
weakening
economy.
4.1.2 INCAPACITY
FOR
THE
INDUSTRY
TO
REACT
TO
THE
CHANGE
IN
CONSUMER
BEHAVIOR
When
we
look
at
the
revenue
streams
of
the
music
industry,
besides
noticing
that
the
revenue
is
in
a
steady
decline
since
2003,
we
notice
that
digital
sales
have
dramatically
rocketed
to
an
increase
of
940%.
What
this
number
shows
is
that
the
recording
industry
is
not
suffering
per
se,
it
shows
that
physical
sales
are
suffering.
People
are
buying
less
and
less
CDs,
rather
they
buy
online,
they
subscribe
to
websites
such
as
Deezer
or
Last.fm
to
listen
to
music,
they
do
not
give
their
money
to
Universal
or
Warner
to
get
a
CD.
The
reason
behind
this
is
that
consumer
behavior
changed
and
labels
did
not
notice
it,
or
decided
to
ignore
it.
In
a
Business
Week
article
from
March
6,
2009
we
can
hear
the
voice
of
a
San
Francisco‐based
graphic
designer
who
explains
that
he
used
to
pay
$100
per
month
on
CDs
to
refill
his
iPod.
Now
he
pays
less
than
$10
per
month
but
listens
to
much
more
music
than
he
used
to.
The
reason
is
not
because
he
started
to
download
illegally,
the
reason
is
because
he
gets
almost
all
of
his
music
from
services
such
as
Last.Fm
where
he
can
listen
to
any
music
he
wants
anywhere
he
has
Internet.
When
someone
has
mobile
devices
such
as
the
iPhone
or
the
Blackberry,
“anywhere”
virtually
means
“everywhere”.
Senior
Vice‐President
and
general
counsel
for
the
National
Music
Publishers
Association
Jay
Rosenthal
recognizes
the
problem
that
people
do
not
need
to
own
music
anymore
when
they
can
listen
to
it
on
the
Internet.43
The
demand
that
boosted
the
sales
15
years
ago
and
50
years
ago
is
not
here
anymore.
Truth
is
there
was
a
boost
in
the
90s
due
to
people
replacing
their
old
formats
with
CDs,
but
in
our
digital
40
Bureau
of
Labor
Statistics.
Consumer
Expenditure
Survey.
Spending
on
newspapers
and
magazines
slides
as
spending
on
Internet
access
soars.
Retrieved
on
March
11
from
http://www.bls.gov/cex/newspapers.htm.
2009
41
The
Nielsen
Company.
US
Household
Entertainment
Budget
As
a
percent
of
Spending
on
Recorded
Music.
See
Exhibit.
42
Bureau
of
Labor
Statistics,
by
Flowing
Data.
Retrieved
on
March
11
from
http://projects.flowingdata.com/america/spending/
43
MacMillian,
Douglas.
The
Music
Industry’s
New
Internet
Problem.
Business
Week,
March
6
2009,
retrieved
on
March
11 2010 from http://www.businessweek.com/technology/content/mar2009/tc2009035_000194.htm
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
35
age,
people
do
not
need
to
replace
their
CDs
with
MP3s
because
they
can
already
upload
their
CDs,
buy
single
songs
or
even
listen
to
music
everywhere
they
have
Internet.
Labels
tried
to
use
this
opportunity
as
a
way
to
make
more
sales,
thinking
that
those
websites
would
serve
as
catalysts
to
launch
sales;
that
people
would
want
to
buy
what
they
listen
to
if
they
like
it.
However
this
is
not
how
it
worked
out.
According
to
the
same
Business
Week
article,
researchers
and
industry
consultants
concluded
that
online
music
sites
are
being
used
by
a
growing
number
of
listeners
not
as
a
catalyst
but
as
a
substitute.
Most
of
the
time
the
reason
why
someone
would
buy
a
CD
is
because
they
cannot
find
their
music
online.
The
problem
therefore
is
not
music
piracy
but
simply
that
people
are
migrating
away
from
the
physical
format
of
songs
and
that
labels
do
not
know
yet
how
to
react
to
this
change
that
might
as
well
be
the
most
dramatic
one
for
the
industry.
If
they
do
so
is
because
spending
on
entertainment
has
become
less
extravagant
in
a
world
where
people
can
now
get
as
much
at
virtually
no
cost.
4.2 HOW NEW TECHNOLOGIES HELPED THE INDUSTRY
Most
of
the
literature
on
the
digitalized
recording
industry
accuses
new
technologies
of
killing
the
industry.
We
have
a
lot
of
data
to
back
up
this
assumption
that
financially
it
has
been
a
bad
turn.
On
the
other
hand
a
qualitative
analysis
has
to
be
done
that
can
conclude
the
good
it
did
to
the
industry,
both
for
the
customers
and
the
actors.
4.2.1 DEVELOPMENT OF NEW LABELS
The
two
first
parts
of
this
thesis
showed
us
that
it
is
possible
for
an
artist
to
distribute
and
promote
itself
without
a
record
deal.
However,
for
easier
representation
and
registration,
artists
who
do
not
get
record
deals
because
they
either
do
not
want
to
or
simply
do
not
find
any
can
associate
themselves
or
create
their
own
record
labels.
It
is
common
practice
in
this
industry
and
one
can
remember
the
Beatles
creating
Apple
Records
or
Elton
John
creating
Rocket.
Those
labels
by
definition
are
independent
labels
as
independent
labels
are
labels
operating
without
the
funding
of
or
outside
the
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
36
organizations
of
major
record
labels,
representing
less
than
5%
of
the
revenue
of
the
industry44.
Because
DIY
music
is
more
than
ever
possible
thanks
to
new
technologies,
artists
less
need
the
help
of
record
deals
to
record,
play
and
distribute
music.
The
other
reason
why
artists
tend
to
go
independent,
is
also
due
to
the
financial
decline
of
the
industry.
Because
revenues
are
shrinking,
labels
will
tend
to
cut
costs
to
increase
their
profits.
And
by
cutting
costs
they
mean
cutting
the
artists’
share
of
the
pie.
As
soon
as
in
2000,
Courtney
Love
(singer
and
widow
of
Kurt
Cobain)
wrote
a
pamphlet
accusing
the
major
record
labels
to
be
the
ones
doing
music
piracy,
not
the
individuals
downloading
the
music.
To
express
her
thought
she
does
the
math
of
where
the
money
goes
with
a
major
label
contract
for
an
artist.
What
she
explains
is
that
every
cost
of
promotion,
touring
and
distribution
is
being
recouped
thanks
to
the
band’s
share
of
the
profit,
this
in
an
ultimate
goal
to
stabilize
the
label’s
revenue.
In
a
scenario
where
sales
are
going
down
but
costs
are
staying
the
same
it
is
forecasted
that
the
profit
will
be
decreasing
in
the
artists’
pockets45.
For
this
reason
there
is
much
more
incentive
for
a
band
to
go
independent
where
they
handle
all
the
financials
and
get
full
profit
of
what
they
make
if
it
is
possible.
And
digitalization
makes
it
possible.
What
the
Internet
is
doing
to
the
industry
is
basically
shifting
the
balance
of
power
from
the
labels
to
the
artists.
Another
reason
why
DIY
labels
–
or
independent
labels
–
are
so
popular
is
because
they
know
how
to
respond
to
the
Internet.
They
know
that
to
get
money
whether
they
are
indie
or
major,
they
need
to
communicate,
they
know
that
people
are
rarely
enticed
to
pay
to
experiment,
which
means
to
pay
for
a
CD
they
do
not
even
know
if
they
will
like.
The
entire
music
industry’s
success
is
based
on
communication
because
that
is
what
music
does,
it
communicates
things
to
people
and
this
is
why
people
like
music.
John
Lennon
said
it
“My
role
in
society,
or
any
artist's
or
poet's
role,
is
to
try
and
express
what
we
all
feel.
Not
to
tell
people
how
to
feel.
Not
as
a
preacher,
not
as
a
leader,
but
as
a
reflection
of
us
all.”
So
for
an
industry
based
on
communication,
the
response
to
Internet
has
been
pretty
bad.
Instead
of
using
this
medium
as
a
way
to
be
more
effective,
they
try
to
accuse
it
of
destroying
them
when
it
clearly
is
doing
the
opposite.
44
Source:
Association
of
Independent
Music
(AIM)
45
Love,
Courtney.
Courtney
Love
does
the
math.
June
14,
2000.
Retrieved
on
March
11
from
http://dir.salon.com/story/tech/feature/2000/06/14/love/index.html
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
37
On
the
other
hand,
everything
“out
there”
helps
indie
labels
to
get
more
coverage
and
that
might
as
well
be
what
the
industry
–
also
known
as
the
major
labels,
the
RIAA,
the
IFPI
(or
their
equivalent)
and
the
money‐getters
–
dislikes
currently.
4.2.2 FOR THE CUSTOMERS
The
trend
might
as
well
be
similar
for
the
customers.
Because
indie
labels
and
artists
have
taken
the
opportunity
to
be
on
the
Internet
and
major
labels
had
no
choice
but
to
follow
the
trend
(by
making
their
catalogue
available
on
streaming
websites,
à‐la‐carte
services
and
online
radios)
,
customers
from
everywhere
in
the
world
now
have
access
to
music
from
everywhere
in
the
world.
The
most
compelling
argument
backing
up
the
assumption
that
the
digital
world
helped
the
industry
is
the
fact
that
the
customer
base
is
enormous
compared
to
what
it
was
a
few
decades
ago.
Once
again
to
quote
Thomas
Friedman,
the
world
is
flatter
thanks
to
globalization
and
cultural
globalization
might
as
well
be
the
best
example.
On
a
musical
point
of
view,
what
it
means
is
that
cultures
around
the
world
are
more
open
to
being
shared
globally
and
eventually
be
absorbed
by
the
local
culture.
Digitalization
has
made
it
possible
for
Burma
to
listen
to
British
pop
music
and
for
Australia
to
listen
to
Chilean
music.
What
it
also
changed
for
the
customers
is
the
impression
of
ownership.
As
the
European
Union
Safer
Internet
for
the
Children
described
it
(see
p.
)
children
blindly
assume
that
because
it
is
on
the
Internet,
it
is
not
illegal,
or
that
because
everybody
does
it
they
can
do
it
too.
As
much
as
that
might
hurt
the
industry
(financially)
it
also
spurs
sharing,
and
by
spurring
sharing,
it
spurs
promotion
of
the
music.
Facebook
has
more
than
400
46
Moghadam,
V.M.
(2005).
Globalizing
women:
Transnational
feminist
networks.
Baltimore,
MD:
The
Johns
Hopkins
University Press.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
38
million
active
users47,
which
means
that
potentially,
a
band
creating
its
page
on
Facebook
can
have
up
to
400
million
fans.
Another
statistic
from
Facebook
is
that
a
user
has
an
average
of
130
friends,
which
can
translate
into
the
fact
that
when
one
Facebook
user
becomes
fan
of
a
page
(at
the
average
of
4
pages
per
month),
130
other
people
are
aware
of
it.
Those
people
hear
about
the
band
from
Facebook,
check
them
out
on
MySpace,
talk
about
it
on
Twitter,
buy
their
songs
on
iTunes,
listens
to
free
streaming
on
Last.Fm
and
go
to
concerts
they
have
heard
of
from
many
other
platforms.
Because
they
control
their
discovery
and
experiencing
of
the
music
so
tightly,
they
are
more
likely
to
appreciate
this
process
and
try
to
look
for
similar
artists
because
it
is
so
easy
to
do
so.
Concerning
distribution,
the
digital
world
has
developed
many
new
opportunities
to
deliver
music
to
the
customers.
Now
to
get
music,
someone
does
not
necessarily
need
to
purchase
a
CD,
or
even
a
single
track,
but
they
can
listen
to
it
once
or
many
more
times
online,
download
a
ring
tone
for
their
phone,
hear
it
on
the
radio,
in
a
video
game
or
in
a
movie,
see
it
live
or
else.
It
is
very
difficult
not
to
find
a
music
we
are
looking
for
as
we
will
be
able
to
get
live
versions
(as
badly
recorded
as
they
might
be)
on
YouTube,
type
in
the
lyrics
on
Google
and
get
the
name
or
use
an
application
for
iPhone
like
Shazam
that
will
tell
us
“who
sings
that”
and
then
eventually
give
us
a
link
to
purchase
it
online.
The
impact
of
new
technologies
for
the
customers
is
tremendous;
it
opened
up
new
horizons
that
no
one
might
have
thought
of
decades
ago.
The
success
of
Napster
in
1999
is
an
example
of
how
the
industry
missed
an
opportunity
to
understand
its
customers.
Music
lovers
voiced
how
they
wanted
to
get
music
and
why
they
wanted
it
this
way
and
instead
of
crafting
on
this,
the
industry
unsuccessfully
tried
to
tackle
it.
Customers
had
already
been
accustomed
to
this
new
way
of
getting
music
and
on
this
developed
many
other
models
that
led
to
the
situation
of
the
industry
now.
In a way, Napster might as well have been the best thing to ever happen to the industry.
4.3 WHERE DID IT ALL GO WRONG?
As
much
as
we
can
now
be
certain
that
new
technologies
have
helped
the
industry,
we
have
to
be
cautious
and
admit
that
this
is
only
ephemeral.
As
it
is
similar
to
any
other
47
Facebook
Press
Room.
Retrieved
on
March
11
from
http://www.facebook.com/press/info.php?statistics
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
39
trend,
the
digitalization
has
a
life
cycle
and
the
problem
is
that
the
industry
jumped
onboard
too
late
to
benefit
from
it
to
the
fullest.
Also
the
industry’s
response
to
the
arrival
of
Napster
in
1999
(trying
to
shut
it
down)
shows
us
that
the
only
reason
why
the
industry
is
now
onboard
is
because
they
did
not
have
a
choice
when
the
strategically‐wise
move
would
have
been
to
identify
the
opportunities
and
turn
them
into
a
competitive
advantage.
4.3.1 WHY DID THEY FAIL TO RESPOND TO NAPSTER?
Quickly
looking
back
at
why
the
industry
declined,
we
have
to
remember
one
thing:
Physical
sales
plummeted
because
of
consumers’
preference
for
low‐profit‐margin
digital
single
tracks
over
full,
hard
to
stock,
albums.
Consumers
changed,
the
industry
responded
too
late
and
suffered
from
it.
When
something
was
going
wrong
for
the
industry,
the
managers
of
the
big
six
and
then
big
four
used
to
think
they
needed
a
big
hit
and
it
would
make
it
all
go
away.
A
few
years
later,
when
the
crisis
was
still
going
on
they
realized
they
had
to
do
something
else
because
no
hit
would
help
them.
Now
we
have
four
big
majors
instead
of
six
in
1998,
2,700
record
stores
have
closed
in
the
US
between
2003
and
200748
and
very
few
of
those
top
executives
are
still
heads
of
the
companies.
The
response
came
late
but
eventually
labels
accepted
to
release
their
catalogue
to
the
streaming
websites
that
we
love,
hoping
we
would
pay
for
the
songs
if
we
like
them,
a
move
that
would
have
been
unthinkable
a
few
years
before.
So
what
went
wrong
with
the
way
the
industry
dealt
with
Napster?
According
to
Simon
Wright
(CEO
of
Virgin
Entertainment
Group)
and
Jeff
Kwatinetz
(CEO
of
the
management
company
The
Firm)49
there
was
a
great
opportunity
there
but
the
industry
did
not
see
it.
The
response
was
suing
Napster,
leaving
billions
of
billions
of
dollars
on
the
table
and
not
accepting
to
“jump
off
of
a
cliff”
and
transform
Napster
into
a
subscription‐based
streaming
service
where
they
could
have
reached
the
already
existing
40
millions
of
users.
The
response
of
those
users
when
Napster
shut
down
in
2001
was
to
go
to
the
hundred
others
file‐sharing
websites
that
were
created
when
the
48
Almighty
Institute
for
Music
Retail
49
Wright,
Simon
and
Kwatinetz,
Jeff
in
Rolling
Stone
Magazine.
The
Record
Industry’s
Decline.
Retrieved
on
March
13
from http://www.rollingstone.com/news/story/15137581/the_record_industrys_decline/print
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
40
industry
was
too
busy
suing
Napster.
They
had
30
to
40
millions
of
people
listening
to
the
same
station,
going
onto
the
same
website,
doing
the
same
thing
and
had
billions
of
dollars
of
opportunities
ahead
of
them.
On
the
other
hand
they
had
retail
store
pressing
them
not
to
sell
cheaper
online
and
artists
asking
them
not
to
cut
down
their
profit
(again),
cannibalization
was
needed
and
the
dinosaurs
of
the
industry
did
not
see
it
as
a
solution.
The
ultimate
problem
was
waiting
for
such
a
long
time
before
licensing
the
iTunes
Music
Store.
Before
2003,
services
were
created
jointly
between
labels
but
they
failed
to
be
successful.
Why
iTunes
did
not?
Because
iTunes
was
offering
a
user‐friendly
environment
and
was
integrating
everything
needed
to
make
it
easy
to
not
download
illegally.
With
the
iTunes
Music
Store
you
would
buy
your
song
on
the
store,
directly
from
the
software
you
use
to
listen
to
the
music
(iTunes)
and
you
can
put
it
on
any
MP3
player
you
have.
The
services
offered
by
the
labels
such
as
PressPlay
and
MusicNet
were
too
expensive
and
did
not
work
on
every
mp3
player.
Also
the
hassle
was
bigger:
people
had
to
go
on
the
website,
buy
the
song,
import
in
the
media
player
they
were
using,
all
these
steps
from
3
different
places,
when
they
were
not
yet
that
tech‐savvy.
Hilary
Rosen,
former
CEO
of
the
RIAA
admits
that
the
period
2001‐2003
(Napster
shut
down
–
iTunes
licensed)
was
the
worst
downfall
ever
for
the
industry:
That’s
when
we
lost
the
users.
Peertopeer
took
hold.
That’s
when
we
went
from
music
having
a
real
value
in
people’s
minds
to
music
having
no
economic
value,
just
emotional
value.50
As
long
as
it
changed
in
people’s
minds,
it
might
be
irreversible.
People
are
listening
to
more
music
than
ever
but
sales
are
plummeting.
Also
the
concert
industry
is
thriving,
it
earned
a
record
$437
million
in
2006.
The
problem
the
industry
is
facing
is
to
turn
that
interest
into
money
if
they
want
to
be
sustainable
as
an
industry.
On
the
other
hand
will
it
hurt
the
artists
if
they
cannot?
Well
they
can
do
their
music
themselves,
are
getting
more
profit
by
being
independent
and
can
distribute
themselves
without
a
record
deal
so
I
am
guessing
not.
The
current
model
is
just
wrong.
50
Rosen,
Hilary
in
Rolling
Stone
Magazine.
The
record
industry’s
decline.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
41
4.3.2 MUSIC
IS
ANTI‐CAPITALIST
This
should
be
the
name
of
our
generation
of
file‐sharers.
Exactly
as
Rosen
put
it,
in
people’s
minds,
music
stopped
having
an
economic
value
with
the
arrival
of
Napster.
The
industry,
as
every
for
profit
organization
would
respond,
did
not
accept
this
and
as
far
as
10
years
later
have
yet
not
accepted
it.
But
the
truth
is
here;
people
do
not
want
to
pay
for
music.
People
argue
it
would
be
a
right
to
have
access
to
music
and
since
it
is
possible
to
get
it
for
free
why
should
they
bother
buying
CDs
that
they
do
not
have
the
space
to
stock
when
they
can
just
get
one
song
they
like
on
the
Internet
and
stock
it
on
their
hard
drive
or
iPod?
Also
they
are
already
paying
for
Internet
access
and
this
allows
them
to
get
music
legally
and
at
no
additional
cost,
so
why
bother?
On
the
artists’
side,
for
once
talent
makes
it
all.
On
the
back
of
the
book
This
business
of
music
marketing
and
promotion
by
Ted
Lathrop
it
says
“because
music
is
not
only
about
talent”,
the
book
was
written
in
2005.
We
are
now
in
2010
and
we
have
much
more
tools
thanks
to
the
Internet
to
use
our
talent
to
create
the
best
product,
and
at
the
end
of
the
day,
because
we
have
so
much
choice
online,
the
ones
we
remember
are
the
talented
ones,
not
the
easiest
ones
to
find,
not
the
free
ones
(because
they
all
are)
but
the
most
talented,
the
ones
who
caught
our
emotions.
5 CONCLUSION
5.1 NEW TECHNOLOGIES HAVE HELPED THE INDUSTRY
The
revolution
of
the
digital
world
has
had
many
impacts
on
our
society.
It
is
even
more
true
when
associated
with
globalization
and
the
current
situation
concerning
information.
We
are
now
able
to
have
access
to
much
more
information
than
we
used
to,
we
can
get
this
information
much
quicker
and
at
barely
no
cost
thanks
to
the
main
example
of
digitalization:
the
Internet.
New
technologies
have
also
helped
us
innovate
in
many
ways
and
develop
tools
that
are
now
broadly
used
such
as
computers,
and
more
precisely
for
the
music
industry:
MP3
readers
and
mobile
devices.
People
have
access
to
the
Internet
pretty
much
everywhere
and
our
Generation
D
(for
digital)
spends
so
much
time
linked
to
a
computer
or
some
form
of
technology
that
it
begins
to
raise
concerns.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
42
More
specifically,
we
have
seen
that
the
Internet
opened
up
a
brand
new
market
in
terms
of
promotion
and
it
affected
traditional
media
greatly
as
we
see
a
decrease
in
their
use
for
promotional
purposes.
For
the
same
reason
that
information
is
carried
quicker
by
the
use
of
the
Internet,
this
platform
is
becoming
a
crucial
element
in
an
advertising
campaign,
if
not
the
most
prominent
one.
If
this
helped
companies
to
extend
their
customer
base,
it
also
helped
the
individuals
who
now
can
exist
on
the
Internet
with
websites
such
as
Facebook
or
MySpace
or
even
Twitter.
On
another
level
it
helped
the
artists
and
the
labels
to
do
a
bigger
promotion
of
the
arts
without
extra
costs.
For
independent
labels
and
artists
it
showed
to
be
the
tool
to
use
to
completely
cut
marketing
costs.
The
Internet
and
our
mobile
devices
such
as
the
iPhone
has
also
helped
to
develop
a
brand
new
kind
of
distribution:
a
digital
distribution.
Not
only
can
we
get
most
of
our
products
thanks
to
the
Internet,
we
can
now
get
some
of
our
products
in
a
non‐physical
way
such
as
MP3s
or
ebooks.
With
the
help
of
the
Internet
and
its
growing
presence
worldwide,
we
are
now
able
to
store
this
information
in
the
clouds,
not
having
to
own
them
anymore,
because
we
are
able
to
access
them
everywhere
with
websites
such
as
Last.FM
or
Deezer
or
even
Pandora.
And
with
the
exception
of
some
of
those,
it
is
virtually
free
to
do
so
providing
that
we
have
Internet.
Those
innovations
are
revolutionary
in
the
information
industry,
and
so
are
they
in
the
music
industry.
Artists
get
more
recognition
and
customers
get
more
choice.
But
it
is
true
that
at
the
end
of
the
day
people
still
think
music
has
no
economic
value
and
this
led
to
a
major
decrease
in
the
industry’s
revenues.
If
the
new
technologies
helped
the
industry
it
is
in
a
non‐monetized
way,
it
helped
promoting
the
art
of
music
and
making
it
available
to
more
people,
it
helped
the
artists
and
it
helped
the
music
lovers.
5.2 THE
TREND
SEEMS
TO
SHOW
THAT
INDIE
LABELS
ARE
BENEFITING
FROM
IT
MORE
THAN
MAJORS
The
only
fault
we
can
accuse
the
new
technologies
of
is
that
it
killed
the
industry
as
a
profitable
one.
People
do
not
see
the
music
as
an
economic
good
anymore
and
hence
do
not
see
the
need
to
pay
for
it.
New
business
models
have
been
implemented,
showing
that
the
trend
is
reversible,
providing
that
the
offer
is
still
good
for
the
customer;
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
43
customers
will
agree
to
pay
a
flat
rate
if
they
can
access
pretty
much
the
entire
music
catalogue
of
the
world.
People
are
not
buying
CDs
anymore.
On
the
other
hand
attendance
to
concerts
has
increased
and
the
revenue
from
touring
is
still
strong.
Because
of
the
DIY
promotion
and
distribution,
and
because
customers
are
much
more
eager
to
experiment
and
consume
and
consume
and
consume
again
and
again
as
long
as
it
is
free,
there
is
a
real
opportunity
for
indie
artists
to
get
a
growing
fan
base
rapidly.
On
the
other
hand
because
revenues
are
decreasing,
major
labels
are
not
capable
to
invest
in
new
artists
as
they
used
to,
it
is
getting
harder
for
an
artist
to
get
a
major
record
deal
if
the
label
do
not
see
it
as
mainstream
and
therefore
big
profits
material.
In
such
a
position,
artists
who
need
the
support
of
labels
for
representation
reasons
are
more
likely
to
cooperate
and
create
or
join
independent
labels.
Because
those
independent
labels
have
fewer
artists
to
manage
and
are
more
likely
to
cut
costs,
they
are
capable
of
moving
and
reacting
much
faster
than
the
big
corporations,
where
the
risks
are
much
higher.
For
this
reason
I
believe
that
indie
labels
have
not
suffered
from
music
piracy
as
much
the
major
labels
have.
And
for
this
reason
they
could
and
will
benefit
from
it
much
more.
5.3 WHAT IS THE FUTURE?
Nowadays
everything
proves
that
the
industry
is
going
completely
digital,
physical
sales
are
going
to
steadily
decline
and
digital
sales
to
steadily
increase.
What
the
labels
have
to
accept
is
to
move
on
because
what
the
last
ten
years
have
proved
is
that
by
trying
to
hold
on
to
the
past
and
prevent
changes
they
were
crushed.
Fortunately
enough
the
recorded
music
industry
is
not
close
to
dying.
And
this
because
the
incentives
have
never
been
particularly
high
compared
to
other
industries.
As
much
as
we
can
call
the
major
labels
“sharks”
or
“capitalist
pigs”
they
are
people
who
love
music
and
who
record
music
for
them
too.
Otherwise
they
would
go
work
for
Goldman
Sachs
where
the
big
money
is.
The
future
of
the
music
industry
is
really
hard
to
forecast,
it
will
only
depend
on
the
decision
that
major
labels
take.
When
they
realize,
and
accept,
that
consumers
are
always
going
to
go
for
the
most
convenient
and
less
expensive
way
to
get
their
product,
maybe
they
will
be
able
to
prevent
a
new
kind
of
piracy,
for
the
reason
that
they
will
be
the
one
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
44
implementing
this
“piracy”,
except
that
this
time
it
will
please
everybody.
If
Napster
did
one
thing
good
to
the
industry,
it
did
it
to
the
music
itself.
Music
became
available,
affordable
and
now
people
are
addicted
to
it.
People
have
an
unprecedented
appetite
for
music
and
they
are
only
waiting
for
the
big
ones
to
figure
it
out.
The
future
that
lies
ahead
can
only
be
the
peak
of
an
art,
music
as
its
zenith
and
with
this
all
the
opportunities
that
come
around.
And
if
it
is
someone’s
to
lose,
it
is
definitely
not
the
artists’,
not
the
music‐lovers’,
just
the
corporations
who
will
not
accept
to
face
the
change.
J.
GAVIGNET
–
THE
IMPACT
OF
NEW
TECHNOLOGIES
ON
THE
RECORDING
INDUSTRY
45
EXHIBITS
Exhibit 1 Flowchart of the standard record marketing/manufacturing process ii
Exhibit 2 Example of incomegenerating uses for a song iii
Exhibit 3 Example of a MySpace page iv
Exhibit 4 Example of a Facebook Page v
Exhibit 5 Example of a Twitter proJile vi
Exhibit 6 Twitturm vii
Exhibit 7 FanBridge vii
Exhibit 8 BandCamp viii
Exhibit 9 BandMetrics viii
Exhibit 10 Description of the Music Genome Project from www.pandora.com ix
Exhibit 11 Musicovery Search Tool x
Exhibit 12 Musicovery Results Screen xi
Exhibit 13 AdAge Top 5 sites in 16 categories ClassiJieds and Social Networking xii
Exhibit 14 US Global Advertising Expenditure by medium 2008 xiii
Exhibit 15 iTunes LP xiv
Exhibit 16 GDP Growth in 5 main countries for the music industry xv
Exhibits
‐
J.
Gavignet
i
Exhibit
1
Flowchart
of
the
standard
record
marketing/manufacturing
process
Source:
Lathrop,
Ted.
2003.
This
business
of
music
marketing
and
promotion.
New
York:
Billboard
Exhibits
‐
J.
Gavignet
ii
Exhibit
2
Example
of
incomegenerating
uses
for
a
song
Source:
Lathrop,
Ted.
2003.
This
business
of
music
marketing
and
promotion.
New
York:
Billboard
Exhibits
‐
J.
Gavignet
iii
Exhibit
3
Example
of
a
MySpace
page
Music Player
Calendar to announce future shows
Exhibits
‐
J.
Gavignet
iv
Exhibit
4
Example
of
a
Facebook
Page
Exhibits
‐
J.
Gavignet
v
Exhibit
5
Example
of
a
Twitter
proJile
Exhibits
‐
J.
Gavignet
vi
Exhibit
6
Twitturm
Exhibit 7 FanBridge
Exhibits
‐
J.
Gavignet
vii
Exhibit
8
BandCamp
Exhibit 9 BandMetrics
Exhibits
‐
J.
Gavignet
viii
Exhibit
10
Description
of
the
Music
Genome
Project
from
www.pandora.com
Exhibits
‐
J.
Gavignet
ix
Exhibit
11
Musicovery
Search
Tool
Exhibits
‐
J.
Gavignet
x
Exhibit
12
Musicovery
Results
Screen
Exhibits
‐
J.
Gavignet
xi
Exhibit
13
AdAge
Top
5
sites
in
16
categories
ClassiJieds
and
Social
Networking
Exhibits
‐
J.
Gavignet
xii
Exhibit
14
US
Global
Advertising
Expenditure
by
medium
2008
Source:
Zenith
Optimedia
Exhibits
‐
J.
Gavignet
xiii
Exhibit
15
iTunes
LP
Exhibits
‐
J.
Gavignet
xiv
Exhibit
16
GDP
Growth
in
5
main
countries
for
the
music
industry
Exhibits
‐
J.
Gavignet
xv
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