The Live Music Industry In The Digital Environment
1. Webcasting – what’s the market?
There are approximately 1 million UK subscribers to broadband, which is likely to double/triple over the next few years, (it is reasonable to assume that there will be approximately 3 million households signed up by 2006). How much of that audience are to consume webcasts is open to question, but it can only increase, as price and availability of technology falls.
2. Is the future concerned with the downloading of streamed digital signals, (the PlayLouder type scenario), non-streamed delivery of digital signals, or of a programme format, perhaps an interactive magazine, which delivers visual and audio footage during the networks’ quieter periods, which may be delivered to 3G mobile, PC via broadband connection or other technological platforms?
Glastonbury 2003 had approximately 90’000 authenticated streams. Increasingly the share of this audience has been UK. In previous years there’s been a bigger uptake from other territories. Claims of multi-million numbers of subscribers to webcasts are unquestionably exaggerated; there simply isn’t the technology currently available to deliver streamed content on this scale. Typically, such inflated webcasts have been free, making it difficult to make projections based on such figures. The pay market is therefore as yet, unproven.
3. Could it be that webcasting is seen as a form of promotion to sell records?
Web casting and streaming can add value to other media sales – subscriptions to websites and downloads in addition to magazines, ticket sales and DVD’s. Large gigs and festivals will factor in sponsorship income, (Freeserve sponsored Playlouder’s Glastonbury web-streams), and DVD content, which will make a webcast financially viable.
In its current form, however, the potential for webcasting has been slowed not only by technological delivery and it’s uptake by the consumer, but also by mechanisms in which to collect micro payments, from which the broadcaster takes even smaller amounts of revenue. This makes a pay-per-stream download an unattractive proposition for both the consumer and content provider.
4. Is there a future for live music venues to become more involved with web-based delivery?
The web has positively impacted on gig promotion, enabling a quick and easy route to find out about and listen to new acts via streamed footage and audio.
In the case of the Borderline, whose own 4-hour internet radio style show has featured music of visiting acts, it has led to increased ticket sales for artists whose gigs might have otherwise gone largely unnoticed. It has also significantly increased general traffic to the venue’s site from around the world.
The bundling of discounted ticket sales through a venue’s website when opting for streamed content or access to interviews & live back-stage footage, was cited as a potential new business model for music venues.
The web has also enabled promoters to target geographical areas, thereby targeting an artist’s fanbase with regards ticket sales for national tours, for example.
5. Rights Issues – who owns a web broadcast?
An area that can range from simplicity to great complexity, the recording of an artist’s performance for streaming involves many rights. This isn’t difficult to resolve if the artist is unsigned in every respect, owns all the music and lyrics and is free to enter into a licensing deal.
Otherwise, the complexity of the deal depends on their contractual terms with respective recording and publishing agreements, the status of the artist, and the label/publishers stance on webcasting. Additionally the activity of webcasting itself is not always fully understood, sidestepping as it does traditional broadcast protocol. The nature of what it is means that a webcast is not necessarily timetabled. The fact that such content maybe available 24/7 makes some rights owners cautious.
Some labels embrace it, others see it as a potential for lost revenue from reduced CD, DVD & VHS sales, or an opportunity to have their artists work/image exploited illegally.
Separate negotiations are needed with the collection societies, (who have standard tariffs and agreements in place – PRS, MCPS, PPL, VPL), and the artists’ managers, (who require performers’ consents – MU/PAMRA).
There is also the issue of whether or not a live stream/webcast constitutes a recording or just a broadcast. Some record companies deem it to be a recording, over which they most usually have ultimate control.
Record companies who have taken the line that such broadcasts constitute a recording remain as yet unchallenged…
In the case of Channelfly, a typical deal would be a 50-50 split between them and the licensor – the people entitled to licence the content. Channelfly would then additionally have to pay monies as due to the relevant collection societies.
6. What are record labels doing in relation to streaming business models?
Clear Channel, AOL and MSN are all looking seriously at downloading and streaming festivals. Thus far, broadband as a means of selling music over the web has been a loss leader.
7. How does this relate to digital TV? Is the future PC or Digital Broadcast?
True convergence of technology and the ability to pay for and view/listen to content on any platform of the consumer’s choosing is still awaited in order to make for seamless integration.
The webcasting of a live gig is no substitute for the real thing. Whilst there is an audience who watch live music on TV, other than paying a license fee, it is currently free. Whether that same audience would be prepared to pay for it via a one-off payment or by subscription is doubtful. Current experience indicates that that it is quite possible that streaming may never make money.
Music is best experienced live, or by audio, as it doesn’t tie the listener down to a fixed location or activity, as it does when watched online or by TV – sitting at a computer to view a 2-hour concert holds little appeal to all but the most dedicated of fans.
8. Streaming as part of a media bundled package?
Streaming certainly adds value as part of an overall media package. AOL is shortly to feature UK bands performing special sessions, as part of a package.
Digital TV is the ultimate example of broadband webcast-style distribution in which music is just one segment of the product mix. However, whilst most of the content is free, the music channels included are few in number. To get the whole mix of music TV, the user has to pay for an upgrade. The viewer can further opt to take part in a box-office event, (e.g. Cliff Richard live in concert), in return for a one-off fee.
It might therefore come as no surprise that the demand for web-based streamed content is low, coupled with the fact that there is currently no user interface worthy of comment. Digital TV serves as the closest example, but there is no lean-back technology in place which allows the consumer to do whatever task they wish to execute by TV, PC, mobile, etc, via a good, easy to use and seamless interface over broadband. When this integration is in place, it may then be possible to make money from streaming over the internet.
Ultimately, webcasting is a limited form of viewing, demanded only by those people desperate to see a gig they otherwise cannot attend, see or hear.
Satellite and DAB broadcasts by are re-broadcast via the student broadcast network, as a bedrock of SBN radio. Similarly, some gigs recorded at student venues are broadcast over SBN as part of the programming mix. SBN is broadcast over DAB – the future medium for radio. However, this is a costly form of broadcasting which student Radio Network can ill-afford. The only way for student radio to continue and to reach a digital audience is to take spare capacity on DAB stations, and import programming relevant to the student broadcasting mix.
DAB shouldn’t be seen as a rival to streaming, more a hint as to the kind of seamless integration of digital distribution technologies often spoken about and eagerly anticipated. As with traditional radio, DAB is perhaps best placed for music delivery – it doesn’t demand 100% of the consumer’s attention in the way that streamed internet footage/TV does. The mobility of the listener is not hampered, as it is with the internet via a conventional computer.
As a comparable distribution model to streaming, DAB contains features and advantages that serve as a practical benchmark:
· ease of use;
· technical simplicity;
· enhanced functionality;
o DAB’s digital output provides for easy recording and later playback;
o New DAB sets will enable the digital archiving of programming onto CDR/MD via spare bandwidth.
o The ability to listen to something, and to then be able to buy it gives DAB an added advantage, satisfying the “instant gratification” experience sought by the consumer, satisfying the “I must have it now” culture.
The ability to record at will with minimal and uncomplicated effort demonstrates the flexibility and high quality listening experience DAB affords – listening in digital, opting to buy in digital and recording in digital.
Taking into account the cost and effort required to buy, set-up and install a PC, (which is then susceptible to virus’s, bugs and glitches), it could be that DAB wins over the internet as a means of consumption of music and live music performance.
DAB versus the internet also has one other key advantage in so far as the live streaming/broadcast of music is concerned – cost. Professional video production and encoding are still relatively high for broadcast quality streaming.
It is far cheaper and easier to record and broadcast digital audio, than it is to set up multi-crew camera teams, (complete with editing and encoding costs) to film an event – a big consideration for smaller artists unable to finance the filming and streaming of their performances.
In being risk adverse, webcasters could be said to be influencing music policy, as only headline acts and “dead certs” will be regarded as viable for streaming.
There are drawbacks with DAB, however.
· It is audio only, and therefore no replacement for web/TV
· DAB currently has a 6% uptake – low penetration by any standard. This will increase significantly over the coming year, however, with a greater number of affordable sets becoming available.
10. How far are we from full integration and lean-back?
Evidence shows people prefer listening to music via radio, than by streaming – certainly the visual element is not in demand to the same extent as the audio.
11. Ownership of broadcast recordings
The incentives for companies to stream are minor, particularly when they have no rights to own the recordings they make, denying them of future revenue streams through future exploitation. This is currently the singled biggest stranglehold on the future of streamed web delivery.
Streaming to cinemas has some potential, with an assembled audience replicating a gig atmosphere to a degree. It can also be tightly controlled, and accountable – the threat of piracy is greatly reduced.
12. The potential for interactivity
The web has community appeal. The online experience is about building events, information and groups around the events. The live experience of the event itself can’t be bettered or replicated via broadcast/internet technologies. An interesting proposition posed was that if the Grateful Dead were starting out now, would’ve they encouraged their fanbase to record and upload footage from gigs, (and their inclusion in P2P file sharing), tapping in as it does, to the serious potential for the interactive engagement of their fans?
Artists and venues alike eagerly anticipate the interactive element of venues broadcasting, say, last night’s performance – however, this activity is most usually absolutely disallowed by the record companies.
Labels and promoters should therefore be looking at ways of closer collaboration for mutual benefit.
13. Technology to evade touts
Mobile technology could allow for the purchase of a virtual ticket in the form of a unique booking number via SMS, removing the need for a physical ticket altogether. Genuine customers could then go online to obtain a printed ticket for posterity – many fans want the tangible thing, making the total eradication of a paper ticket altogether highly unlikely.
However the costs of full integration are prohibitive, and certainly not currently viable for small clubs.
14. At what point does this activity become a media marketing activity, making money through advertising – what’s sold, the content or the advertising?
Music policy can suffer, as music for mass consumption becomes the viable way to sell advertising and respective products. Music for mass consumption does not necessarily equate with good music…
Media partners, record companies and publishers all want a piece of the potential advertising revenue.
15. Access TV, RSL’s and 2/3 yr licences. Will this grow?
This could be a boon to gigs. Integrated with online webcastings and live link ups this is public access broadcasting at it’s best. It was suggested that the BBC excel in this area, and that they should perhaps be looking to increase such activity.
Is there a market? Rarity value, especially with artists and acts that become successful, will always be there. There is a growing market for value-added content for CD’s, CD-ROM’s and DVD’s.
Do you have any comments to make, or conclusions to draw?