Business Intelligence
There is no question that the internet has changed the business of music. The story line goes that independent artists are using the internet to reach their public directly (without the need of labels), focusing on generating income from live performances and alternative revenue sources. But how does reality compare with that story line?
In a new report published by IFPI (International Federation of the Phonographic Industry) entitled, “Investing In Music“, the reality of the music business is that the vast majority of successful music performers are still signed, published, marketed and supported by the recording labels. While it is true that the internet has brought a broad range of new distribution technologies and disrupted some of the old ways of doing business (primarily around distribution), the labels, and their A&R (artist and repetoire) representatives still play a critical role in identifying, producing, marketing and promoting new (and old) talent. The IFPI report identifies how the $5 billion annual investment in recording artists by record labels represents 30% of the revenues from the sales of music and that it still takes $1milion to break a new artist into a major market, just as it did before the internet. With the exception of distribution, the business of music is really the same as it was before the rise of the internet. One might say, that the rise of the Internet, and it’s pervasive technologies has passed the music business by. What the music business is still missing are the answers to the questions of: Who should we sign? Where do we spend our marketing dollars? and When should we spend those marketing dollars? These are the three most important questions a music label (or an independent musician) can ask.These are BI questions.
The music industry’s missing link, that other industries like, retail, advertising, manufacturing and logistics, get from the internet, is the raw data that Business Intelligence (BI) processes feed on. Business Intelligence systems identify, extract and analyze raw data (sales revenue, demographic data, etc), providing historical, current and predictive views of basic business operations. These views are then used to support a more informed decision making process by the business. Specifically, the data the music business is missing is: where are audiences listening to a particular artist’s songs? what platform are they listening on? how much of the song do they listen to? and when are they listening to it?. This is exactly the kind of data collected by musicTRAY, a new audio promotion platform that delivers exactly the data and BI processes needed to extract the answers to these questions, without enabling piracy.
