How Technology Affects the Music Industry?

Introduction

In all industries, technology plays an important role in increasing the competitiveness of business entities. In the music industry, it increases cost-effectiveness while at the same time enhancing the capacity of the industry players to reach global consumers more effectively. Through technological platforms such as iTunes, consumers have a wide variety of choice for their preferred music. They also have easier access to music at low costs. Amid these benefits, technology also presents some challenges to the music industry across the globe. This paper discusses how technology influences the music industry.

Positive Effects of Technology on the Music Industry

MP3 constitutes one of the technological developments, which completely changed the music industry. Jones reveals how it permitted artists to acquire higher revenues, expand consumer music selection, and/or ensure consumers obtain music more cheaply (213). These benefits were astounding. Through the MP3 technology, people acquired a means of creating new music formats. It also eliminated huge amounts of manufacturing and shipping costs of the recorded music (Kibby 93).

Technology permits people to exchange music without incorporating intermediaries (record stores). Hence, through the MP3 technology, artists could sell their music at cheaper prices to reach a large number of customers. Through MP3, traditional music labels also became unnecessary. This situation reduced production costs. Moreau suggests that through the MP3 technology, “music could remain available for longer periods because there would be no labor, storage, manufacturing, or cataloging costs” (18).

Other technologies such as iTunes also have similar benefits. The technologies have given music an intangible essence. With the emergence of e-Music platforms, the distribution of music is now enhanced through the internet. People can also play music directly from the internet. In fact, global populations now have no limitation when it comes to the accessibility to any music genre. People can play audio digital music. They can also stream it directly as audio-video music. This advancement has increased the efficiency of music distribution across the globe. Indeed, RIAA (Recording Industry Association of America) confirms, “ the market share of online music download via the internet or mobile phones as a percentage of the total sales of recorded music in the United States rose from 1.5% in 2004 to 50% in 2011” (Moreau 18).

This finding suggests an increasing trend in online music compared to recorded music due to technological developments. Through new media platforms such as Spotify, artists can now avail their music for live streaming. This platform minimizes the cost of music recording and logistics that are involved in the distribution to all customers.

In the music industry, promotion is an important strategy for increasing sales volume. Through new media technologies, artists can now take the advantage of viral marketing, which minimizes promotional costs of music compared to using traditional media, especially TV and radio. Viral marketing involves advertising through unpaid internet-based platforms for sharing advertisement information between people who are connected through one or different social media platforms.

Social media constitutes any Web 2.0 application that permits a two-way interaction between people, organizations, or a combination of both. The interaction is done via an online environment through which the intended marketing content audiences have the capacity or no capacity to make modifications or even design and produce a marketing content before transmitting it to other people, organizations, or even groups of individuals (Mills 163). The fact that platform people share promotional information among themselves in social media, artists can now reach an unlimited and uncontrollable number of audiences with promotional materials for their music. Therefore, artists can sell many music copies with minimal costs and efforts (Southgate, Westoby, and Page 352).

Amid the identified positive impacts of technology in the music industry, there has been reluctance in embracing it by music industry players. Dematerialization of music via technology has fostered the development of networks to permit people to download different music genres (Ward, Goodman, and Irwin 5; Coleman 41). This claim is perhaps true for iTunes. Major labels took a long time to permit iTunes to access their catalogues and/or embrace unlimited access to flat-rate business models that are currently associated with digital goods. One of the major early concerns of the labels was piracy, which is presently associated with digital files that are placed in an online platform (Krasilovsky and Shemel 67). This observation suggests that technology also has some negative effects on music industry.

Negative effects of Technology on the Music Industry

Piracy is a common problem that artists encounter. Without the appropriate legislation and regulations, technology can create loopholes with which people breach patent laws. Moreau reveals how “MP3 technology poses a significant threat to the way both artists and their labels do business” (18). The MP3 technology enables people to make copies of music with a sound that almost resembles the original copy in terms of perfection. It permits people to duplicate music labels in an effort to offer them for mass consumption in an internet environment. These pirated materials erode patent laws (Varian 122).

The internet has now completely altered the music industry. Before its wide application in the music industry, almost every person gained access to the web. The music industry relied heavily on CDs and cassettes to share music. People could not copy music in these devices. However, with the emergence of MP3 technology, copying and storage of CDs became possible. Technology developments have made hardcopy music insignificant. One can easily borrow a CD from a friend, copy it to a personal computer, and return it to the original owner. With the soft copy of the CD, it becomes possible to share it with virtually everybody around the globe via the internet and social media platforms.

Amid the positive effects of the internet technology, it has also shaped the music industry negatively. Increased internet speeds have made it possible for artists to stream their music for global consumers. However, consumers can illegally share pirated music using software such as Limewire and Napster. In fact, piracy amounts to a challenge that musicians consider impossible for the police or governments to address (Moreau 26).

The emergence of social media networking applications has taken the negative effects of technology on music industry a notch higher. For example, with MySpace, people can follow artists to gain information on their latest release. With YouTube, people do not depend on TV stations or DVD players to watch any music. With the internet connection, Pandora and Spotify (streaming services) permit people to use the internet to watch music anywhere across the globe. When they are utilized properly, these technologies are important in helping to reach mass consumers. However, the abuse of the copyright of artists in a technological world is commonplace.

The introduction of iTunes store for music in 2003 marked a period of immense changes in the music industry. Sales dropped by 4.7billion US dollars from 2003 to 2013 (Moreau 25). Upon adjusting to accommodate inflation, revenues from music sales halved, following the introduction of iTunes stores. Surprisingly, within the time in which iTunes has been in the market, more music has been sold than before. This finding implies that amid the increased music distribution due to iTunes technology, the music industry has experienced a reduction of revenues. Therefore, iTunes technology increases music distribution rate while at the same time reducing the amount of earnings for the artists.

In 2014, more than 1.4billion online music copies were pushed through the market in digital form, thereby decreasing the sales of CDs by 700% (CNN Money par.5). In the same year, an excess of 75% of the total music sales was executed through digital platforms. Even after the emergence of Google and Amazon as distributers of digital music, iTunes accounted for 63% of the total distributed digital music in 2014 (CNN Money par.7). This observation suggests that the decreasing music revenue due to the application of digital technology in music industry can be attributed to the introduction of iTunes.

Conclusion

Through technology, people have increased access to music of different genre. Technology has other positive impacts on the music industry. It eliminates manufacturing, cataloging, and promotional costs that are associated with music production. Artists can also increase their distribution rates across the world in a very short time. However, technology has led to a breach of copyright through piracy. Although general logic reveals how the increased distribution has translated to increased revenues, especially upon the elimination of manufacturing and cataloging costs, the onset of technologies such as iTunes has led to decreased revenues in the music industry.

Works Cited

CNN Money. A Decade of iTunes Singles Killed the Music Industry, 2015. Web.

Coleman, Martin. Playback: From the Victrola to MP3, 100 Years of Music, Machines, and Money. Cambridge, MA: Da Capo Press, 2005. Print.

Jones, Steve. “Music that Moves: Popular Music, Distribution and Network Technologies.” Cultural Studies 16.2(2002): 213-232. Print.

Kibby, Marjorie. “Home on the Page.” Popular Music 19.1 (2000): 91–100. Print.

Krasilovsky, Williams, and Stephen Shemel. This Business of Music: The Definitive Guide to the Music Industry. New York, NY: Watson-Guptil, 2003. Print.

Mills, Antony. “Virality in social media: the SPIN Framework.” Journal of Public Affairs 12.2 (2012): 162-169. Print.

Moreau, Francois. “The Disruptive Nature of Digitization: The Case of the Recorded Music Industry.” International Journal of Arts Management 15.2 (2013):18-30. Print.

Southgate, Douglas, Norman Westoby, and George Page. “Creative Determinants of Viral Viewing.” International Journal of Advertising 29.3 (2010): 349–368. Print.

Varian, Hal. “Copying and Copyright.” Journal of Economic Perspectives 19.2 (2005): 121–138. Print.

Ward, Morgan, Joseph Goodman, and Julie Irwin. “The Same Old Song: The Power of Family in Music Choice.” Marketing Letters 25.1 (2014): 1-11. Print.