The state of music in 2011, and other thoughts from CMW

Question:

Is music losing?

I choose my question carefully here. Obviously, if it were restricted just to “are the major labels losing?” then, duh, the answer is yes. But when you add independents, many of whom are having greater success than ever, the answer becomes more complicated. Some artists are flourishing in the digital age, others faltering. But frankly, there’s a good case to be made that there is more great music today, being made available to more people, than at any other point in the art form’s recorded history.

But in spite of all this, my single greatest takeaway from last week’s Canadian Music Week conference is the question I pose above, one never explicitly asked by any single panelist but which felt like a low, rumbling undercurrent of the entire week. After hearing from researchers, executives, musicians and observers about the state of the industry and the music audience, I find myself more worried than ever that the answer is “yes.”

What do I mean?

Not, as Bon Jovi thinks, that Steve Jobs ruined everything, that’s for sure.

No, I mean that despite a gold rush of great bands and songs facilitated by Internet production and distribution, we are renegotiating the role of music in our lives in such a way that its ultimate value may be decreasing. That people like you and I—presuming you’re reading this because you consider yourself a “music fan”—may be decreasing in number. That for more and more people, music is invited background noise, a wallpaper of sound that decorates their lives rather than helps define them.

And, perhaps, that it was always going to end up this way.

* * * * *

Backtrack to about a month ago, when I found the above graphic online. It’s from a study done by Evisional research and commissioned by NBC Universal. The mega-corp wanted to evaluate the state of online public BitTorrent file sharing and how it might be impacting its various business components. This particular pie chart breaks down the content types of the top 10,000 public torrents in December 2010. As you can see, pornography, television episodes and films make up, combined, almost 75 per cent of the chart.

Music? A mere three per cent.

For those like me who’ve had our ears immersed in 10 years of rhetoric about how file sharing is killing the music industry, this is a pretty staggering number. After all, the industry’s lawsuits have succeeded in largely eliminating Napster, Kazaa, LimeWire and all their competitors from the playing field. BitTorrent is the largest remaining file sharing mechanism left. And music accounts for only three per cent of its top downloads?

Yet when you hear analysts like Mark Mulligan of Forrester and Russ Crupnick of the NPD Group discuss the attitudes and behaviours of music listeners, this all starts to make sense.

* * * * *

Both Mulligan and Crupnick presented on CMW’s first panel of the week, along with Vanessa Thomas of Nielsen, establishing an unsettled vibe for the festivities. Despite some variances in their tone—Mulligan more apocalyptic, Thomas more analytical, Crupnick perhaps the most optimistic—I personally took away a consistent message from their facts and figures: we’re at a critical moment, where the gap between how the industry delivers music to listeners and how listeners actually utilize it is reaching a breaking point such that, to quote Mulligan, “This is another Napster moment.”

Digital music sales are flattening. They aren’t hugely successful outside of iTunes, and while everyone and their mother believes that paid streaming services—with one price point to access a huge collection of music via cloud computing—are likely the future of music commerce, issues with licensing have kept them from making any significant dent in the marketplace to date. Things are bad in Canada, but Nielsen’s numbers showed aparticularly unhealthy American music market, where digital track sales increased only 1.1 per cent year-over-year in 2010. I don’t think anyone quite expected digital downloads to fully replace the gigantic, artificial sales boom of the CD era, but the replacement gap, economically, is gaping; you may be surprised to know that despite how pervasive digital music is in our lives, 2011 will be the first year that digital income surpasses physical CD sales, a ridiculous 12 years after Napster changed everything.

But the economic replacement gap is, for me, far less concerning than the people gap. Of the 35 million CD buyers who have disappeared from the marketplace in the past five years, most haven’t switched over to digital—they’ve simply stopped buying music. NPD’s research finds that about 20 per cent of the Internet population in the U.S. buys music online; the market penetration for CDs was once over 80 per cent. We may think that digital activities such as peer-to-peer file sharing, connecting with artist pages on social networking sites, or buying individual tracks are the new way of music commerce, but by Forrester’s numbers all of these are considered “niche” activities, far from mainstream penetration.

Let me repeat that: most digital music activities are niche.

Does that mean that music itself is becoming niche? Are former listeners divorcing music from their lives altogether? Or have they just rewritten their relationship with it, as the digital generation has done?

* * * * *

When discussing social media in my day job, I’ve grown fond of the “digital native/digital immigrant” dichotomy, a handy (if overly simplistic) method of explaining the changing attitudes of a generation that’s grown up online. But Mulligan’s presentation complicated this by arguing that there are actually three generations worth considering in the digital era, at least when it comes to music. And that it’s the most recent one, the true “digital natives” that have grown up online, that are leading the reshaping of music’s role in our lives.

While the “transition generation” adapted traditional formats into digital ones—the album, the single—these formats have little relevance to teens who are 12-15 at the moment. They’ve expected instant access to music from the get-go, and with video streaming, they’ve found their killer app, so far, at least. (See more at Mulligan’s blog)

Indeed, one could argue that video streaming is music’s only true success story in the digital age. Watching videos online is the only mainstream music activity left, though perhaps “watch” isn’t the operative word; more aptly put, 80 million Americans “listen” to music video (and maybe watch as well). And YouTube/VEVO is their music destination in spite of the fact that its sound quality is, well, often abysmal. Why?

I got a big kick out of the week’s academic panel on “The Future of Music – Is There One?” focusing so intensely on sound quality. It’s not that the esteemed professors were wrong or misguided in their concerns about how digitally-produced music often sounds worse than analog, and many of their observations were both astute and thought-provoking, but that it felt like they were missing the forest for the trees in seemingly arguing that sound quality is such a vital force in music’s decline. Maybe it’s just the McLuhanite in me, but I can’t help but feel that if we’re talking about the story of music’s decline, we should consider the medium before the message.

* * * * *

Because, frankly, sound quality only matters if music means something independently, on its own. And to some of us, it does. But to many true digital natives, the idea of music as an object, something to be collected or ‘owned,’ is foreign and strange. It’s not something to be gathered, it’s just found: heard passively on streaming stations, or at parties, and then playlisted later at their convenience. The medium has defined their relationship with music, with seemingly total access and the need for instant gratification at the forefront.

The phrases Mulligan used to describe this generation’s attitudes struck an unnerving cord with me. “Experience is the product,” he said, suggesting perhaps that for teens, it’s only in music’s utility—its use at the party, or the concert, or the road trip—that it has meaning. At another point, he referred to music as “a pervasive soundtrack to their immersive social behaviours.”

He wasn’t the only one to express this sentiment. Brad Schwartz, senior vice-president of the Much MTV Group, discussed his networks’ rebranding to focus on music experience rather than music itself, in response to video-centric programming witnessing a 66 per cent decline in the 12-34 demographic over the past few years. Terry McBride, president of Netwerk, suggested that it’s intellectual property (the song) that is the true future of the industry because it’s flexible enough to have value in different experiences. “The content is valueless,” he said, speaking of the recorded artifact. “It’s the context in which you experience it that it gains value.”

This attitude extends beyond the digital natives too. One NPD study that Crupnick cited found that when asked what would get them to pay for music, eight out of ten listeners answered “nothing.” And almost half of listeners said that if they heard a song they liked, they’d probably just listen to the song on video sites and never really consider buying it.

Listening is enough,” is how Crupnick described this attitude. But if we’re talking about the future of music, what does it mean when listening is enough?

* * * * *

Everyone loves music,” said Rio Caraeff, president and CEO of VEVO in a keynote presentation at the conference. And on the surface, it’s easy to agree with him. Music is foundational to the human experience, and we utilize it as an essential part of many of our social rituals. And on that front, things aren’t really changing. I was an eyewitness to that fact two weeks ago, hosting teen dances as part of the 2011 Canada Games; for most of the athletes, the chance to let loose to “Firework,” “Yeah x3” and “Dynamite” was one of the most anticipated events of the week. But did they love the music, or did they love dancing?

Caraeff followed his statement with, “Not everyone is going to buy music.” Again, he’s probably right. It’s just that in the past, loving music, more often than not, meant purchasing it—especially if you wanted some degree of control over the experience, the sort of control that music television, radio or the dance club simply couldn’t provide you. Today, the Internet gives you that control. And between music videos, streaming sites and your own music collection, it gives you enough control such that the need to purchase music to have a music-supported experience is pretty much negligible.

So while everyone may “love” music, do those that buy music love it more? And does music mean less when you don’t pay for it?

I hesitate to quickly answer “yes” to these questions, because it suggests a rather coldly commercial relationship with an art form that means a lot to me. But I don’t think we should be so dismissive of what happens when we separate music from its physical and economic boundaries. Indeed, I would argue that by its very nature, digital music has a lower inherent value than physical music simply because it really isn’t anything at all. It’s just sound and noise, zeroes and ones.

What is gained in music’s transition to digital is an increased flexibility of application. No longer bound by things such as artwork, genre, or even space and time, today’s music is endlessly applicable to our lives. We can cue up emotional responses, memories, dance tracks, all at the touch of a button. It’s never been easier to soundtrack our lives.

What I fear is being lost is the independent value of that soundtrack, of music for music’s sake. That given the choice between spending time with songs and records, or other entertainment options like movies and television, music is losing out. That records are becoming utilitarian to a fault, artifacts for dancing or emoting rather than worthwhile experiences on their own. That even the concert—while in decline, still on the surface a less-threatened musical experience than music buying—is going in the same direction, the flashbulb of cameraphones and the glow of text messages transforming it from a musical experience to, foremost, a social one.

But my real fear—and this may be hard for us devotees to wrap our heads around—is that maybe music never meant that much to most people to begin with. Maybe our perspective on music’s importance in people’s lives was artificially inflated by people being forced to buy records to have a soundtrack. Maybe the seemingly deep connection between previous generational identity and music that we’ve all bought into—60s music and the baby boom, 80s music and Gen-X—was a technology-supported inflation of reality, sold to us by a media environment keen to sell more records. Maybe all people really wanted was a chorus that spoke to them softly; their interest in bringing music deeper into their lives was minimal.

Right now, many bands and record companies are intensely focused on how to get people to buy music again, and that’s understandable. But were they truly astute, they would realize that the real battle ahead of them isn’t convincing more people to buy music. First, they have to get people to truly love music—and to do so beyond the casual, effervescent soundtracking that the digital world so easily provides.

And right now, more or less, they are losing that battle.

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One response to “The state of music in 2011, and other thoughts from CMW

  1. Pingback: …in which McNutt embraces the complications of music subscription « McNutt Against the Music·

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