The changing face of the music industry

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Durham students will always love listening to music on their way to lectures, whilst working out, or relaxing with friends.

But the business side of the equation is currently uncertain as the expansion from the dinosaur age of CDs in the 90s to the downloading days of the former decade makes the uncomfortable adjustment into the Subscription era.

Whilst downloads still account for 71% of the $5.6billion music industry market, Digital music subscription services like Spotify, Deezer and now Beats Music are expanding with paying subscribers now at 30 million.

An unnamed record executive of one of the three major record labels says he believes, “Downloads are slowing down as heavy users of iTunes are figuring out that they’re better off on a streaming service”.

Yet many musicians are unhappy with the change. Thom Yorke of Radiohead feels that these subscribers do not pay artists enough for their rights. He points to the fact that a song would need to be streamed one million times on Spotify to make $7000- the equivalent of just 12,000 download sales.

The problem lies in subscribers offering a free advertised service of their product; just 6 million of Spotify’s 24 million users pay.

Faisal Galaria, a former vice-president at Spotify says, “At the minute they’re being given a choice between £120, or free, so most people are choosing free”.

The music industry remains obstinant in its belief that if they offer new features like enhanced audio quality, people will be swayed to spending on a premium subscription. It does not seem likely that the majority of cash conscious consumers will take this deal when companies are offering a free subscription to shuffle artist music that has a decent sound.

If the music industry wants to make the subscription age a success it will have to make its prices more competitive.

Let the price wars begin.

Photograph: idrewuk

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