THE NEW MUSICAL BOX

STREAMING UP, DOWNLOADING DOWN

In the battle for the music-consumer's hard earned cash, there's a subtle and growing change in how music is purchased.

Much has been said about the decline of fixed-format music (CDs particularly) in the face of on-line digital competition. CD sales continue to decline and it's only the current phenomenon of vinyl becoming increasingly attractive that shows any hope for this line of business. But, in some new figures released in the USA by Neilsen Soundscan, it now appears that even the download industry is struggling in the face of a relentless onslaught from streaming services such as Spotify, Rhapsody, Youtube and Rdio. In the first six months of 2014, the number of audio and video streams increased by a massive 42% compared to the similiar period in 2013. To put some scale to this, the number of songs streamed moved from 50 million to over 70 million - whilst at the same time, download sales (such as iTunes for example) have declined by almost 15%. This means that increasingly, consumers are becoming more motivated by paying a monthly fixed fee for a streaming service rather than buying and *owning* individual tracks or albums.

Deezer - Looking to expand into North and South America

Part of this is a change of habit - it is not the acquisition of a piece of music which is important, but the ability to access it quickly and easily whenever the desire strikes, Add to that the continued rumblings from some quarters about who *owns* downloaded songs (iTunes have previously asserted that a customer's iTunes songs cannot be passed on to chosen beneficiaries in the event of death) and it's easy to see why streaming might be the current top dog. I've written before about moves by companies such as Amazon wanting to get into the streaming business and it seems that a further smaller-scale player - Deezer - is poised to make a big breakthrough in terms of volume streaming with a new service aimed at Latin America, Brazil in particular. It currently only accounts for 5% of all streamed music, mostly in Europe and mostly in partnership with telecoms companies such as Orange. However, as these telecoms companies get an increasingly wider foothold in an increasing number of countries, Deezer rides on the back of that success. Deezer's own view is that by going down this route, they've actually benefited the streaming business by "...taking people who were pirating into people who are now paying". Deezer's next step is to break the US market - and they've recently hired a new CEO with specific responsibility for cracking that monolith. 

iTunes - in the USA, *issues* about passing a purchased iTunes
library to a chosen beneficiary on death. 

We shouldn't get too carried away just yet: there are only perhaps 25 million on-line music fans who pay for streaming services - and that's out of a potential market that could reach as high as 2 billion if all internet-connected consumers bought music. But, it does demonstrate the potential - and where there is potential, large corporations smell profit. Whether this benefits the consumer remains to be seem. Music ownership will be a difficult barrier to truly remove - and by the time that it has, what's to say that streaming as a method of delivery will itself have been superceded?

Thanks goodness for the continuing existence of local
live bands such as Bournemouth's The Lizzards
(Picture: Beca Fludgate)

I consider myself pretty open-minded when it comes to how I find music and how I experience it. But the constant changes in formats and delivery strategies do little to engender confidence that it's really about the music and the art, rather than the monetisation and profit. And as always, those that make the music in the first place don't seem to be consulted about seismic changes about how their music is sold. Thank goodness, I say, that there are still local bands up and down the land who are prepared to create and present great music - let's just hope that they don't get drowned in the backwash of decisions made in the rarified atmosphere of some corporate boardroom. 

Alan Dorey

21st July 2014