When did you last buy a CD? I didn’t buy one for a pretty long time and the last one I bought was from an artist I like nearly every single piece of work he creates, Pat Metheny. Is then the music business going away for a free show? Of course not, because one buys legally music on-line. Do we really?
NPD Group, a market research firm, gave us some clues recently in publishing a new report about the music industry. Here are in shorts the finding for 2007:
- 48% of all teenagers never bought a CD (38% in 2006)
- CD sold in the U.S. fell 19% from 2006
- Apple iTunes (selling only digital downloads) is now the #2 music shop in the U.S. jumping ahead Best Buy and trailing Wal-Mart
- 29 Million people bought music legally from online music stores, up from 24 Million in 2006 i.e. + 21%
I’m convinced buying singles or albums on-line is not the ultimate business model. What about subscribing for a monthly fee of about $20 to listen to all the music you can get legally? Store it on your MP3 device when you’re not connected for as long as you pay for your subscription?
You like this idea? All the music you can get for a flat fee? What about Video
And what about for FREE?
Well checkout hulu.com, all the video you can get on-line for free, because you get advertising with it. Unfortunately only in the U.S. for now.
… and what about software? What about a flat monthly fee to access a dedicated application portfolio coming out from several vendors, a bouquet of SaaS focusing on a business or personal matter (Sales, Marketing, …).
Let’s watch this e-commerce space carefully as music and videos are paving the way when it gets down to digital goods business models tsunamis.
I went to Apple Expo on Friday. I missed the Mac ecosystem for long and it was refreshing to feel this relaxed vibe again. One could smell creativity, innovation and fun everywhere. I was impressed with the amount of business generated around iPod, up to the car manufacturer clearly using this European event to promote their latest innovation like Mini and Audi. Is iPod ready becoming of importance for cars manufacturer?
iPod ready devices were sparkling all around. This iPod ready screen from ViewSonic, announced on Sept 12, would tend to reinforce how PCs are not that important anymore. Plug your iPod and watch your videos, listen to the music or have your photos sliding in. USB connectors and memory card readers would let you use other devices as well. But take a close look at the icons, this is running MS Windows! Anyway, they’re promoting a “Made for iPod” label. Road to success? Isn’t Apple now the “iPod creator” company rather than the Mac one anyway?
iPod has become an icon for reinventing a fading company around a breaking through innovative product centered on a web 2.0 trend: sharing music on-line. Remain to be seen how Apple iTunes will respond to Universal SpiralFrog investment to turn music into an ad sponsored business. And what about this strange silence from Google about music except this very late announcement into the game: Google Music Search. Now that Google CEO, Eric Schmidt, is sitting on Apple’s board of Directors, I’m sure I’ll have something to blog about in a very short while about iTunes response to free music. Stay tuned and listen to SOMA FM music, as I do, in the meantime.
One final note. Customization is big when talking about web 2.0 business models, isn’t it? Check out this special customized Mini limo — yes a limo — that was presented in front of the show — see my pictures on flickr — so cool. And what do you think about this gaming seat from Playseats as well?
Creativity is back. Hope and ambition are flourishing just as during the rise of the Internet bubble — except VCs are still skeptical. Web 2.0 is a reality fellow marketers, Marketing 2.0 is on its way.