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NMA: Ad-funded music model under strain

This demonstrates again that there aren’t two music business models (online, offline), but possibly hundreds, with Pandora, Youtube, last.fm, iTunes and many others each approaching with different offerings and potential for revenue.

Should the industry pursue a “pay whatever can be sustainable” model to ensure innovation?

Amplify’d from www.nma.co.uk
The digital industry is warning music companies not to pin their hopes on advertising revenues to plug the shortfall from declining physical sales.
The calls follow a breakdown in negotiations between YouTube and music collection agency PRS for Music, which saw the video-sharing site start to pull down its entire catalogue of music.
Google has attracted anger from the music industry after demanding being given the chance to build up sustainable advertising income before being hobbled by what it deems unrealistic fees.
Read more at www.nma.co.uk
 

The Music Industry Knows Where Things Are Headed

It will be much harder for recording-only artists to earn a decent living. Live performance is where it’s at when thinking about revenue, with online music as the marketing vehicle to get paying customers into the venue.

Amplify’d from www.techcrunch.com
It’s all part of a master plan. The labels fully understand that recorded music, streamed or downloaded, is going to be free in the future (we’ve argued this relentlessly). CD sales continue to decline by 20% per year, and the only thing that’ll stop that trend is when those sales reach zero. Nothing will replace those revenues.
They also understand that recorded music will largely be little more than marketing collateral, meaning that the Internet services being sued today for copyright infringement will be embraced in the future as ways to get the word out on hot new music. These services pay for the privilege today (either through high streaming rates or in court), but in the future they’ll be the ones getting paid by labels. Think radio payola at a whole new level, and there won’t be any more talk about social networks giving stock to labels and artists. Money will flow the other way, as it should.Read more at www.techcrunch.com