Tag Archives: Music

Music, Video and Software business models paradigm shift underway

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:

  1. 48% of all teenagers never bought a CD (38% in 2006)
  2. CD sold in the U.S. fell 19% from 2006
  3. Apple iTunes (selling only digital downloads) is now the #2 music shop in the U.S. jumping ahead Best Buy and trailing Wal-Mart
  4. 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.

Blogging future: leverage the long tail opportunity

I’ve been spending an interesting afternoon at Apple Expo in Paris yesterday with my dear friend Christophe Ginisty. Beside being Apple’s PR, he’s also renowned for his blogging activity. He organized a debate about blogging future. Asking candid, or was it, questions about whether blogging is just a fading trend or a ramping up attitude.

I tried to make a point there that I wanted to share with you. Blogging is to press media what video sharing (YouTube, DailyMotion) is to TV, and Music sharing (MySpace) is to Records. Blogs success in my opinion lies in the ability for anyone to publish articles without a financial equation supporting it and with very low barriers to entry. Blogging is free and easy (no web design skills required), to be compared with the press where audience must be as large as possible for advertising revenue to enable it, and where printing or broadcasting requires technical and financial muscle. The same is true for video and music production and distribution compared to the new free or close to free e-capabilities.

Blogging, publishing music and video on the net doesn’t require a large audience either to be possible. It is enough to have a few hundred interested people and you can keep going. But adding up these very diverse communities of interest leads to a massive audience. This is the long tail opportunity that the net offers. To be compared to Business 2.0 magazine not publishing anymore, despite facebook community trying to rescue, by economic failure.

So to me, all these individual contributions to the blogosphere, videosphere, photosphere and musicsphere are here to stay, widen and provide a huge creativity and freedom expression area without a capitalistic equation attached.

"iPod ready": a new marketing gimmick

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.

Advertising 2.0 bridging the digital divide?

As you’re reading this blog, you’re probably a “Heavy Internet User” (HIU) i.e. someone who has accessed the Web at least 11 times in the previous seven days as close to 100 million people in the US, or about one-third of the country’s population. Don’t start calling your mom telling her you’re part of a new elite: first of all because you’re just a little ahead of the herd and then because it just means you’re not taking care of your beloved ones enough ;-). But Marketing 2.0 is also a little ahead of the herd … for now, but certainly not ignoring our beloved ones: customers.

McCann just released an interesting study entitled The new “digital divide” — as technology has become one source of the “generation gap”— trying to understand how the new generation of digital consumers are transforming Mass communication, impacting communication and more specifically advertising.

Let’s get out of the way the blogging attitude: 62% of HIUs are blogging, going up to 71% for the 16-34 years old HIUs. “No longer can we simply broadcast our messages to a mass audience and hope that our standard metrics of reach and frequency will guarantee success,” said David Cohen, the author of the report.

Why does it matter? Well, one third of the total US population is not a niche really. Then because 84% of HIUs have using Internet to research a future purchase and buying on-line as their most common activities. Go get them fellow marketers, but don’t use the wrong marketing mix.

Check out the table above, provided by eMarketers, the technologies they use most are not the ones we market to easily: instant messaging, price comparison web sites and social networking sites (MySpace, Friendster, …). I encourage you to read the report to find out how HIUs react to various ways of advertising on blogs, but as you would expect 39% are just bothered when a company are seeding blogs to sell their products/services. Wikipedia, MySpace and Craigslist do rank well in the top 10 Internet Services they use currently. And finally, 49% “watch” TV, 47% listen to iPods or CDs and 41% to the radio while surfing the net.

To leave you on an even happier note, “word of mouth” is to them the most valuable and trustworthy channel when purchasing a product. So move it, switch to Marketing 2.0 now before it bites you.

You know where some McCann execs are headed now? Well Robin Kent is starting SpiralFrog, a free ad-supported music-download service in conjunction with Universal Music Group. Yes gang, music is finally going for the free syndrome as well. But SpiralFrog is not alone, Napster is going for it as well, allowing consumers to listen to up to five tracks for free while they view advertising.