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Music Industry

I guess that one of the most common beginnings for a blog post is “After a several months of inactivity….”. I believe this happens in those moments when life outside the blog is bubbling with action and activity. So it is. Since last Spring that I have entered this spring roll of events and gained such an “elance”, that made it so difficult to document it. Certainly, changing cities, jobs, and basically life, has a lot to do with that. Although I am still feeling totally immersed in this dynamic (and I am enjoying it to the last bit!), I am coming to this moment in which I have the urge to tell something about it, and in that way document it and to possibly have some closure as things go around or away.

In my last post, I was preparing to leave to Vienna, the capital of Music, in order to perform a communication of an article which I have wrote for Vienna Music Business Research Days 2013 conference. It was called the “Disintermediation effects on the music industry. A return to old times?” and it is available at the conference site, right here. The whole trip was kind of magical, given the circumstances in which I went there. I reached Vienna by myself, which was going through a heat wave, with temperatures around 32ºC, and I got to stay in this nice and cozy apartment which I’ve rented with AirBnB. I chose it due to its proximity both the university where the conference was taking place, and the historical city centre. I was welcomed by its owner who was so nice and made me so at ease that I almost felt like home. I was kind of worried at the beginning, being my first time with Airbnb, but I definitely got lucky with this trip.

In the conference, my presentation went so well that I could hardly believe it. I had such an enthusiastic audience, with lots of questions and discussion in the end. One of them was actually Peter Jenner, manager of Pink Floyd and the Clash, with whom I ended up discussing my perspective over the music industry over coffee, at the session break. It was really interesting to see that my progressive perspective and approach resonated with both the new and senior generations that were present. The conference focused mainly on the topic of copyright in music, and had very important lecturers and great moments of discussion. You can read about it here. I definitely recommend it to anyone who is interested in topics regarding the music industry. I also made some good friends there and I really have to thank everyone who was there for the a great time that I had. So thank you Peter and Madeleine Tschmuck, Carsten Winter, Peter Jenner, Joachim Haupt, Lorenz Maxon and Peter Bubstinger. On top of that, and this was the cherry on top of the cake, my paper was awarded with the Young Scholars’ Best Paper Award 2013, which felt really nice ;)

The article published there was actually a byproduct of my master dissertation, which was around the topic of the impact of economic disintermediation in the independent music business. It was still under construction at the time. In the following months after Vienna, I focused on finishing it, which involved interviewing several independent musicians and music professionals at the Portuguese indie music scene. Among them :papercutz, Astroboy, The Poppers, Nuno Saraiva from La Maquina management and Lovers&Lollypops. This implied a hard effort but which I believe that has paid off. At the beginning of September I had the final document written and printed for delivery. At the end of October, I was ready for the defense of my dissertation. I had the disputation with prof. Carsten Winters, invited professor from Hannover University of Music, Drama and Media, and it went very well. I managed to get a Summa Cum Laude, for which I am very proud. I hope to publish a link to its final version real soon ;)

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Goods news to share! I have had an article accepted for publication at the Young Scholars’ Workshop at Vienna’s Music Business Research Days conference! The conference is taking place at the Institute for Cultural Management and Cultural Studies, in the University of Music and Performing Arts, Vienna.

The central topic of the conference is, music business research, which according to the its site definition, “is a new scientific approach at the intersection of economic, artistic, especially musical, cultural, social, legal, technological developments that aims at a better understanding of the creation/production, dissemination/distribution and reception/consumption of the cultural good music. It follows an inter-disciplinary research and teaching approach that is characterized by methodological diversity.”

Hope to deliver a nice prez ;)

Vienna, here I come ;)

This article examines music consumption amongst young people, and uses the concept of “tribe” to define consumer centric profiles and characterize them over how music is consumed, market awareness, technological knowledge and the use of music in the construction and maintenance of the personal identity.

Six consumer profiles were identified and characterized using qualitative methods based on focus groups interviews. Some profiles tend to comply with the industry’s rules and traditions, while the others put an active resistance to the normal modes of licit market exchange of music.

The industry compliant faction is comprised by the Conventionalists and the Loyalists profiles, which share as main similarity usually legal consumption of music. The Conventionalists have limited music knowledge, depending on the music charts, radio and friends recommendation, being highly influenced and ultimately concerned with developing a music taste that is socially acceptable among peers. The legal consumption is mostly related to their lack of technical knowledge. The Loyalists have deep affection and loyalty towards artists, which is demonstrated through the legal acquisition of music and ownership of physical formats. They use music to define their identity and frequently consider themselves to be opinion leaders in their peer groups. A third profile also fits in this faction, the Experience Seekers, although not averse to illegal acquisition due to budget reasons. Their desire for memorabilia, nostalgia, and for consumption supports the importance of physical ownership.

Within the industry resistant faction, lie the Preachers, the Revolutionists and the Techys. The Preachers, which are non-mainstream and perceive the record industry as commercial, privilege their spending on smaller, obscure, ‘more deserving’ artists. They consume music either legally or illegally, so they can have access to an infinite selection of music, which is in turn used as social capital. They are often highly opinionated, and consider themselves influential in discovering new music. Like the Preachers, Revolutionists are into non-mainstream music, are overtly opinionated, and may support legitimately smaller artists. They possess a strong anti-market perspective, which leads a heavy use of illegal downloads and are considered movers in the music market due to their strong beliefs. Techys possess advanced knowledge either about music software, hardware and the music industry, and value sound quality and the methods for listening. Together with the Revolutionists, they are considered drivers of change in the industry.

Regarding the latter faction, which is considered increasingly relevant, the authors suggest that new marketing efforts should be taken, possibly more akin to a partnership approach, that may generate more engagement and empathy, and ultimately, enlighten these consumers of the benefits of legal acquisition and the necessary commerciality required to finance new music development.

One of the aspects I’m working on my dissertation covers the categories or roles in which music consumers can be classified. The goal here is to come up with a scientific sustained categorization/profiling of music users.

I’ve been looking for articles which are able to help me in this task and found some for which I’ll reviewing their main points here.

“Live and prerecorded popular music consumption” – Montoro and Cuadrado analyzed the profile of the popular music consumer, considering both live and prerecorded popular music, having profiled the average and frequent music consumer. Furthermore, they have tested hypotheses regarding the impact of the internet and file sharing on popular music consumption and the potential substitution and social motives for attendance of live show. Links between both markets were taken into consideration, and direct causal links were observed.

Gender, age and the impact of active practice and cultural participation were variables which have shown similarities between both profiles. The distinctive determinants of consumption were time constraints for live attendance for frequent consumers, and available income for both profiles.

The demand for popular music of some frequent consumers is more of a demand for information, while for the rest, other aspects like the social motivation, seem to have a more important role in it. This shows differences between profiles regarding to the potential substitution effect between live and prerecorded music.

Frequent consumers show a common disposition to music, either live or prerecorded, being catered for by both markets. This supports the “substitutability relationship between live and prerecorded music for frequent consumers”. On the contrary, average consumers are moved either to one market or the other, in an heterogeneous fashion; “once we account for direct links between both markets and for all the covariates, the average consumer is either a consumer of live or prerecorded music.”

A causal link between both markets was observed, with prerecorded music consumption increasing the probability of live concerts attendance, with stronger incidence on frequent users. Live concerts attendance showed no significant affectance on prerecorded music consumption.

The exposition to file-sharing networks showed an increase of live attendance for average users, rather than for frequent users. A negative impact was observed on the prerecorded music market by the use of the internet and file-sharing, although weaker for the frequent consumer. For the latter case, the origin of the prerecorded music was considered, either by legal acquisition, copy or internet download was considered.

Several conclusions can be taken regarding the evolution of the music business. Despite that, in the past, the prerecorded sector has subsidized the live sector, things have evolved in the opposite way. Nowadays, live shows support prerecord music sales, which is consistent with the rise of prices in live shows, with artists giving away recorded music in concerts and through the internet. This also explains and supports and the positioning and market strategies that labels are adopting with the all-inclusive contracts that cover not only prerecorded music sales, but also management, concert, merchandise and endorsement revenues.

Interestingly, the authors claim that, the fact that different agents in the music business sustain different activities, such as labels and concert promoters, leads to the under provisioning of these activities like promotion; otherwise, the internalization of all the generated effects in one entity would lead to optimal outcomes.

Within the efforts of my research activity, I’ve been introduced to this crowdsourcing platform  for sound-designers called AudioDraft. This platform implements the crowdsourcing model in a very lean and straightforward way. For the ones who aren’t familiar with this, this platform brings brands and sound-designers together, through contests to which the crowd applies with sound-design works, from which a final winner is selected and remunerated.

Following some related links, I came to find out that it’s mentor, Tommi Koskinen, takes part in a very interesting band from Helsinki, self assigned as post-indie electronic, with visible nordic influences, that reminded me The Knife, among others.

 

Apart from this, the owner of the beautiful vocals, Hanna Toivonen is also a music tech entrepreneur, CEO of a company called Mukava Music. This company released a mobile app called clerkd, but it seems that, after peeking at the social media around it, they are aiming for something bigger. It is not very explicit though. I wonder what it is…