Nov 15, 2016 Atte Hujanen
All of the different entertainment industries, have been extremely active in discovering new technologies, harnessing them and eventually adapting them to best fit their uses. The classical mantra is that the porn industry has been in the forefront of adapting new tech. However true that might be, the key term here is adaptation. Wherever there’s some sort of content being produced, transmitted or rendered by some form of technology, eventually all entertainment industries have followed behind with great haste and (in most cases) considerable success. Let me elaborate:
Music’s adaptation to technology …
Guglielmo Marconi’s 1896 patent for a wireless communication system via the Hertzian waves formed the basis for the first commercial communication system. It was soon accelerate into a widely generalized form of content transmission by the World War I.
The magnetic tape was in part introduced through another wave of technology acceleration because of World War II. AEG and BASF created the new recording technology that the Allied world got to experience only in the closing of the war once loot through Europe unveiled the secret recording method. After that it was open season for the technology, which eventually produced compact cassette by Philips and once again the industry took major leaps as it embraced a new era of distribution. The story unfolds very similarly with the creation of CD by Sony and Philips, who both seeked out data storage solutions and simultaneously adapted the platform to create Compact Disc Digital Audio format.
… slows down with software
All went seemingly well for the content industries as long as it was either analog or hardware based tech that they were making the most out of. Then came yet another technological wave of change and instead of riding it out, most of them dropped the ball to varying degrees. It took some 17 to 20 years (depending where you start counting) for the music industry in particular to wrap their head around the new paradigm of software and start enabling the shift instead of fighting against it.
Why, then, was it so hard?
One can make an educated guess that the Not Invented Here syndrome played a big and oh-so-familiar role in the decades worth of lost opportunities. The entertainment business is about big shows and big egos that come with shows, but in some cases the egos behind the curtain are bigger than the ones up on stage.
Philips owned PolyGram, a joint venture with Siemens, which eventually became one of the leading distributors of recorded music. Sony had their own strong interests in publishing and distributing entertainment. Thus, for industries intertwined like this, the alignment created an everlasting interest to develop, adapt and generalize new technologies in order to grow the businesses from all angles. In the long term, loops like that lead to price skimming strategies and protectionism which at first benefit the seller and weaken the situation for the buyer, but usually end up making things worse for both with the entrance of outside disruption, such as the software revolution.
Software is here to stay
After a long period of recurring lost opportunities, the tides are turning in a similar fashion as they’ve previously done with other technologies. Spotify has gone from the non-desired upstart as the industry standard against which the likes of Apple Music (not paying as much) and YouTube (not paying as fairly) are now being held to.
Last year streaming accounted for 85.8% of the total recording market in Sweden. It’s quite possible that the industry will end 2016 with more than 100 million people paying a music subscription globally, a growth that is more than offsetting the decline in physical sales and downloads, yet again proving that the pie gets bigger when the offering becomes better. The wildest predictions state that by 2022 there are almost a billion mobile music subscribers globally. If not for these “software dark ages” within the industry, could 2022 very well have been 2017?
Software is here to have to its meal and the faster every last one of us gets on board, the faster the industry embarks on another golden age. Want to know what to look forward to in this brave new era? Come to Slush Music to take peek to the future of the industry.
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