The Day The Music Died

The Day TheMusic The Day TheMusic DiedDied

Social Media and the Music Industry

Social Media Conference NWBellingham, WA Sept 10, 2008

Source: RIAA

$14.8B

$7.9B

$10.4B

incl. Digital

Recording Industry Revenue

US ConstitutionUS ConstitutionSection 8Section 8Section 8Section 8

““To promote the Progress of Science and To promote the Progress of Science and useful Arts, by securing for limited Times to useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”their respective Writings and Discoveries.”

19291919

Radio

Advertisers

1899

Songwriters

Publishers

1909

Labels

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Performers Audience

$

$

$

Publishers

Radio

Audience

ASCAP

CHARTERAmerican Society of Composers, Publishers and Authors

A collective bargaining association representing the interests of its various Record Labels

Not For

Broadcast

1929 1939 1949

SongRights

Phonorecord

Public Performance

Broadcast

Phonorecords

Synch

$% or Fee none

¢Statutory Rate

ConsumerProduct

$% or Fee none

$Negotiated Rate

$% or Fee

Publishers

Record Labels

Broadcast

Audience

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1966

my darn good mixtape

1971 1979 1985

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1983 1988 1991 1994 1995Internet .COM Web Netscape Win95

Audio Audio Home Home

RecordingRecordingAct of Act of 19921992

Digital Digital Performance Performance

ininSound Sound

RecordingsRecordingsAct of 1995Act of 1995

Digital Digital MilleniumMilleniumCopyright Copyright Act 1998Act 1998

Digital Transition...?

SongRights 1.1

Sound Recording

Public Performance

Broadcast

Phonorecords

Synch

$% or Fee none

¢Statutory Rate

$% or Fee none

$Negotiated Rate

Digital ¢Statutory Rate001001001001010010010010010100100001001001001010010010010010100100

101001110010010010010100100100100101001110010010010010100100100100101001001010011100100101010010010101001001010011100100101010010010

0100101001001010011100100100101001010010010100111001001001

$% or Fee

$% or Fee

ConsumerProduct

Truth is, the record business was pretty messed up by the mid-90’s

Launched

1999Summit

2000Peaked

2001Bankrupt

2002

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P2P

Apple

2 BillionP2P

5 BillioniTunes

Apple vs P2P

TotalTotal Per MonthPer Month

80 Billion?

• Apple dominates digital

• CD, ringtones dropping

• International = fuggedaboutit

• DRM mostly dead (except at Apple)

Music Today...

• ASCAP, BMI at record revenues

• Synch growing

• Publishing assets dominate balance sheets

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Radio: “He’s only mostly dead.”

Less Music?

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music nowDemand Control

Attention

Copy

About Social Media...

ThoughtsThoughts

Thank You!

matthew@socratech.comwww.socratech.com