PREDICTION 1: Facebook will enter the music industry.
As we enter a new decade, I thought it would be fun to write a 5 POST SERIES, predicting the changes in the music industry for the next 10 years, based on my observations of the world I can see around me. If any of you have a good memory, please submit your score card to me in 2030. I don’t have a crystal ball, but many of my last decade predictions (certainly not all of them) have come true. So here goes.
Spotify & Apple should be worried.
Facebook will make the bold move into streaming music. So far, Spotify are the main players and profiteers of this business model. Musicians and record labels were severely disrupted by music streaming in the last decade.
They shot themselves in the foot on numerous occasions, surrendering the mixes of a historical legacy of recorded music for pennies. It was almost as if illegal downloading had become legal overnight.
To add insult to the injury, Spotify pays a successful artist just about enough to buy them a cup of coffee. HMV shops are closing around the country, while the only relief for musicians, is the resurgence in gigs and vinyl. The recording industry is a wounded beast.
The recording industry is a wounded beast.
The record labels have managed to claw back power. By controlling the algorithms and using their legacy powers and royalties revenues, they can negotiate with the big streaming companies to put their people on the top. It’s started to stabilise and the next big change is on it’s way, which is Social Media. This is where Facebook enters.
Facebook will come along and make further disruption particularly for Spotify & ITunes. Facebook’s massive advertising revenue is far more profitable than Spotify’s neat little ads which make it sound like a radio show. Facebook, with all of its influence in gossip, politics and advertising, will not need to charge a subscription rate for users who barely notice the ads any more. Or don’t mind seeing them in a social setting. It means they will be able to create a music subscription platform that is more competitive, integrated with the social chit chat and will connect directly with artists and label pages. People will share playlists, comment on what they are listening to and more. We will be tagging songs not just pictures. Facebook’s and Instagram’s cross platform influence outside music will give them even more power.
the power of facebook
Spotify and iTunes will struggle to compete with this. How much they are affected, is of course hard to know. Yet, millions of musicians, who have never been consulted by their record labels, will not care. Nor will there be any love lost for the PR heads who inflicted this subscription model onto music in the first place. Despite artists still receiving very little in streaming royalties, the artists will take great joy in seeing this shift of power away from established streaming services and having the big labels on the back foot again.
Social media as we know is a place of fake news and biased opinions. In the artistic realm, an “artistic” take on “taste” and liking music based on your emotions is actually a perfect fit. So Facebook can enter this world very successfully. It might start with independent artists.
Yet, when Facebook throws its support behind new ambitious artists to kick off their service, the big guys will want to catch up. Just remember the early YouTube days!
Sorry, iTunes Music and Spotify, why would I spend £10 a month with you, when I can get the service free on Facebook. I’m already so used to the ads that I barely notice!