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What is up with the “music business”? May 27, 2009

Posted by stewsutton in D7 All Things Digital.
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irving-azoffInterview with Irving Azoff, CEO Ticketmaster Entertainment

First some background on the music industry…

Record companies and technology mix – business attempting to protect a dead model for revenue production.  Suing a consumer is a dead-end thing.  They may go to the advertising model.  Acts are still being introduced. Internet allows direct connect to the fans.

Will there be record companies in the future?

THe 4 record companies are great repositories of over 100 years of material.

Record companies will transform into “music companies” like Ticketmaster/LiveNation.

Creative side of the business is anxious – losing the revenue and royalty payments from intellectual property produced.

iTunes is a great partner

Selling individual tracks as opposed to the old model of full albums brings a smaller revenue stream. – This drives the live performance and the branding.

Merger of music, retail, and multiple product lines.

So where does the music fit in all of this?

You never know where new talent will emerge.  Taylor Swift – writing her own songs in her garage, exposure through YouTube, MySpace, etc. – On the live circuit? – Technology has a lot to do with spread of information and building the brand.

New technologies will be embraced more than in the past.  There is not near the sort of money available today that the record companies used to make.  Those days are past.

Every time there was a great technology, the record companies extorted such great fees that they put that cool technology out of business.

Mergers and stuff – LiveNation (concert promotion company – and artist development process) – everything evolves around the desire to see the live artist – and Ticketmaster (a ticketing solution for events).  Ticketmaster a focus of great criticism – performance of handling the number of requests verses the total number of tickets that are available – lots of taxes and fees – this makes it complicated and expensive and makes the customers angry.

Radio is not integral to music – MTV does not matter anymore – Artists need to connect to their fans (email connection direct to fans via “ticketmaster”)

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