10 Predictions for the Music Business in 2015

These predictions come via Bobby Owsinki writing for Forbes.  I follow up each one with my own comments

1. Apple launches a new music service. Beats Music doesn’t have a huge number of subscribers so it can be retired without fear of killing a well-liked brand. In its place Apple will launch a new on-demand streaming service that’s cheaper than the competition and features high resolution audio.

I say: A certainty.  Apple knows that they can’t rely on selling downloads through iTunes for much longer (see point 4) and iTunes Radio hasn’t exactly taken off.  But will they be able to take on Spotify and Rdio in a meaningful way?

2. High resolution audio becomes a standard streaming feature. TIDAL and Deezer set the precedent, and soon all streaming services will offer at least one tier of hi-res audio. Of course, the definition of high resolution will continue to be a moving target, as some services equate the term with CD quality while others offer higher sampling rates and/or 24 bit depth.

I say:  I certainly hope so. I’ve long despaired about how so many people settle for awful sounding MP3s and are content to consume music through cheap ear buds and (gasp!) laptop speakers.

3. The digital pie gets larger. As consumers become more comfortable with on-demand streaming, larger numbers of them register for the various platforms. More of them than ever are willing to pay for their service of choice than ever before.

I say: Streaming is the future. It’ll just take time for people to get used to accessing music instead of possessing it.  A lot of this new adoption will have to do with the evolution of the connected car.

4. Downloads continue to slide. Downloads fall below $1 billion in total revenue as music consumers find that having access to millions of songs is a lot better than owning just a few.

I say:  Yep. See point 3.

5. Vinyl soars again. Once only a blip on the radar of the industry, vinyl sales continue to grow to the point where they make a very small but significant contribution to the bottom line of many record labels. For the first time in 40 years, new vinyl production gear is produced to meet the demand.

I say:  Vinyl sales are still only a blip, but growth shows no sign of slowing down.  But I’m not sure existing pressing plants will be able to keep up with demand.

6. Artists find the right villain. Numerous artists see the various streaming platforms as the ones responsible for their tiny royalty payments, but many begin to see the light that it’s really the record label middle man that enjoys the majority of that income. As a result, artist’s attorneys negotiate new agreements with record labels to make the split a bit more equitable, but the record labels still continue to be favored.

I say:  I hope so.  Streaming music isn’t the same as selling music. Instead, it’s more akin to listening to music on the radio. Do NOT confuse streaming royalties with sales royalties. Got a problem with how much you’re being paid for streaming? Take it up with your record label and your collective organization. They’re the ones who set the fees.

7. Google’s YouTube Music Key initial acceptance is subdued, but gradually gains marketshare. Consumers used to getting their music for free on YouTube don’t initially see a reason for changing to the payed tier offered by Music Key when it’s initially launched, but begin to see the benefits of the service over time. The platform may take a full year to hit its stride, but it will eventually get there.

I say:  Probably.  YouTube is the biggest source of online music discovery in this arm of the galaxy. But after years of being accustomed to get all kinds of YouTube music for free, I think it’ll take longer than a year for consumers to catch on to any kind of paid model.

8. Spotify and Pandora take a hit. With the new entrants from Google and Apple in the marketplace, the growth of both Spotify and Pandora is stunted. Pandora is especially hurt, as consumers find they’d much rather pay for on-demand streaming than just a digital radio.

I say:  Maybe, but their positions as incumbents is pretty strong.

9. Revenue from traditional music distribution channels decays, but still continues to roll. Terrestrial radio still plays a major role in breaking acts, and listenership remains high despite the increase in streaming music consumption. Likewise, CD sales continue to fall, but at a slower pace than predicted. They’ll die eventually – it just won’t be this year.

I say:  Totally agree on all counts.

10. The next new trend in music finally surfaces. The charts have been dominated by EDM-flavored dance music and country music for too long as consumers begin to tire of the genres. A new trend emerges that sets the music world on its ear. This is one that I predicted last year, but missed on. Hopefully it was just a year too early.

I say: PLEASE let there be an upswing in guitar-based rock. Please?