MUSIC INDUSTRY – THE PRESENT
2002/2013 – The Digital Years!
Digital era is the era of all paradoxes. The one which deleted the physical format while searching for the best one. The one which saw all-time highs in terms of sales volume that go on par with some of the lowest years in terms of revenues. The one where the constant evolution of technology brough all logics related to the media, to revenues, to the way of promotion back to the very original form of they had in the music industry first years.
Music industry has always been concerned about adjusting to consumers’ habits. All physical formats ever got released before the need was felt by consumers. Plus, all formats which disappeared did so barely because a more modern one was available. In 2003, for the first time ever, the opposite and negative situation happened: this is the collapse of a format – physicals, mostly CD – that pushed majors into relying on a new one – digitals. It means the music industry felt short in anticipating upcoming changes, being a good 10 years late. This strategy error will end up being an awfully expensive mistake. In fact, gross revenue of the industry dropped from $38 billion in 1999 to $15 billion in 2013.
From 2003 to 2005, charts from most countries started to take into account digital sales. Expectations are high for this solution considering how many advantages digitals had for the consumer. No more changes in record format requiring to replace his old disks. Capability in copying the song on various hard disks, doing backups, listening to it on various computers or phones. Indeed, the first corollary of the no more physical format solution was actually the main revolution of the digital format: consumer finally got rid of the Music Player constraint, once he purchased a download, he may listen to it everywhere he wants. A second corollary to this formula was just as important: the number of potential consumers was instantly much higher as every person owning an internet connection was able to download, representing way more people than consumers owning a proper music player.