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The music industry has dramatically changed. Innovation in Internet technology is the primary instigator of this change, because people have the ability to listen freely to their favorite beats. Platforms like iTunes (not free), RDIO, and Pandora are ushering in waves of creative applications that cater to every need of their consumers. Sean Parker, co-founder of Napster, would obviously argue that the Internet and music industries are closely linked. Here is a graph of the average amount of time spent on some established and up-and-coming music websites over the past two years:
You will most likely be familiar with many of these tools; they tend to be free and cater to a social experience for sharing music with your friends. One thing that is particularly notable is the amount of websites that allow you to listen to music for free; there are hundreds of them! The Internet has certainly proliferated music for the masses and anyone with a Wi-Fi connection can listen in.
One website to watch is turntable.fm. Its originality stems from giving users the ability to DJ; while it is not exactly a radio website, turntable.fm allows users to passively listen to playlists that are “DJ’ed” by other users. This lends to some unique features, including individual music “rooms” that separate music genres and provide capacity limitations for having over 200 people (known as the fire hazard). Stay tuned for the social expansions of this website, as it will surely continue to innovate in the online music space.
An interesting group of players to watch are traditional radio stations which are expanding their terrestrial offering by creating an interactive experience online. Boston area stations, WEEI.com and WAAF.com will increase in popularity and engagement due to their ability to reach local consumers over multiple platforms.
Spotify has recently catapulted into this field due to a dynamic partnership with Facebook. Spotify is an application that is based on social interaction and its drastic increase in visits over the last two years is a testament to its populatiry. Turntable.fm has benefited from Facebook integration as well, with traffic spiking in September. Google is also an emerging player in the market with its offering of Google Play, which allows users to link music on their mobile and laptop with one account (similar to iTunes). In the coming months, online streaming will continue to evolve and platforms will continue to be creative in their feature and benefit offerings.
So what does the future of the online music look like?
Here is my prediction: Independent and non-label artists will have a vastly increased presence in the online space. Record companies and publishers will also benefit as long-tail revenues will increase from the additional traffic driven via socially designed listening platforms. This will lend to the power of small bands and will place emphasis on an artist’s ability to engage their fans on a personal level. Boston indie band The Gentleman Outfit is a great example of a band with a purely social outreach program that will benefit from having the ability to engage fans as the band continues to grow. Over the next few years, we should see an increased voice for independent and local bands through their social outreach platforms. Their social offerings and engagement of fan bases will determine their overall success and influence in the digital space. Over time, we should see bands like this come to the foreground of the online music scene, because users want personal engagement with their favorite music. Expect some seriously creative applications from the online music industry in the years to come.