The New Flatness

I read a lot of Bob’s posts but this one stood out to me.  I was just having a conversation with someone about this same exact subject the other night.  At the root of the this issue, of making available copyrighted material on streaming sites such as YouTube and MySpace, is how to monetize it.  It is really very simple.  When in doubt learn from your piers in the same market.  What is the simplest way to make money on the web?  Advertising.  Wrap up the content in pre or post roll ads.  This will accomplish two vital things.  One being that the majors will start seeing some income from all their material they have available and two, it will at the very least be a step forward instead a lateral step or no step at all.  The music industry in particular, hasn’t made big steps in experimenting with monetization schemes.  These are times of trial and error.  But they don’t have to be that risky if you look around and learn from other’s mistakes.  Fred has a good post on his ideas for monetizing YouTube.  YouTube will look at Google for inspiration on how to make money.  Other industries should do the same.  The music business needs to pay very close attention to what services like YouTube and MySpace are doing because these services are the future of their content distribution.  There is no question that this is how content will be served up in the coming years.  All of these issues make me want to form a consulting team that would walk with music labels and other content owners as they navigate how to make money in an “everything is available all the time” world because its not going to come from the inside.  I should do that.

picture originally uploaded by: me

This subject is getting so much talk lately but I have to say one more thing about it. What MySpace should have done that would really put them ahead of the pack would have been to pioneer the mobile distribution of music downloads. This would have been huge and it would have put them far far ahead of anyone else in this market, even Apple. Apple is going to come along and do mobile distribution better than anyone else and it will be difficult for anyone else to catch up. However, MySpace does cater to the “unsigned and independent” niche and that is what separates them from Apple. This could prove to be how MySpace will win music customer market share over Apple. The bottom line is that there are more unsigned and independent bands than there are signed bands; MySpace and Apple respectively. MySpace is deeper in search when compared to the Apple store and is user generated where the Apple Store’s content is distributed like old media. These are growth stages that we’re seeing right now. Step one was the iTunes store, step two is the MySpace store, step three will probably be by Apple in the form of extensive mobile distribution. The next nine months will be interesting to see who makes big strides in mobile.

photo credit: me

MySpace is going to start selling music via their site without and DRM.  The interesting thing to me is that Snocap is involved.  I have been following what they have been doing over the past year and wonder what their niche is going to be.

photo credit: oh_no_whoa

Char has a post today about social networking that is right on. I believe his thoughts are really valid especially when you look at where we are right now. Social networking is such a buzz word right now and sites that encourage it are growing so quickly. There will be a time when the growth slows and the questions that Char is asking are going to be the same ones asked by many.

UMG usually seems more ahead than any of the other majors labels when it comes to pressing forward into using using new technology…not to mention they’re ahead of the pack in revenue.

Universal stands out when compared to the other major labels.  They are the only major that is making steps like this and its such a good thing.

AnySong is a new mobile music search and discovery service being introduced in Holland.  Universal partnered with Targetize to provide the technology solution.  And, it seems like part of the revenue stream is going to come from advertising sales on the service.  This is the right direction for mobile content providers.
This is the beginning of what will be common place in a few years.  What needs to happen in the states is a mobile search service for MySpace, TagWorld and the other big social networks that use music as part of their service.  Helio is trying to do this…but Helio is closed system.  You have to use their devices.

The search and discovery service for something like MySpace needs to be an open service that can be accessed by any device.

MySpace and Co. seem to have a vision as to where they want MySpace to be in the future.  Instead of just using the site as is, they are pushing the evolution of the social network.  Asking questions like what else can we do with this dense group of people besides just integrating paid search?  After only aquiring MySpace nine months ago it is good to see them making steps to continually evolve and change the service.

Thats what it is all about today.  Changing quickly and frequently.

Always look for the next space to push into.  FIM is doing just that with new ventures like Fox Atomic that I mentioned in my last post.
MySpace used music to create a user base and a social group that grows based initially on musical tastes.  That is what other purly music based services need to be concious of.  Music recomendation sites like Pandora, Mog and many others should think about something.

Why not use their users and join them to another service.

For instance; join GarageBand a music discovery service with a service like Dodgeball.

Push music discovery into an unlikely space.

Did you see Rupert?  Charlie always asks the right questions.  The interview was not ALL about MySpace but it was a big part of it.

Something that Rupert said resonated with me.  “Content is everything and…the focus must be on making it better than ever.”

With all the great and amazing things that are happening right now with the way you and I are aquiring our content; the content itself has to be better than ever.

No longer are the days where content is made for the majority.  It has to be built for everyone.  It has to have the ability to be customized for everyone’s world.

Rupert also developed Foxatomic.  Its a part of Fox that developes content just for 17-24 men.  The site so far has multiple partners including Jupcut which is a online video editing and publishing service.  This is the future…content provision has to be deep for customers to be loyal.

There has been a lot of talk about LisaNova…sure you’ve seen her around.

This is the state of things now. Its possible to have your material see and heard by everyone…everyone knows this. …although Mark thinks its boring.
I can’t help but think what it would have been like if these tools were available when Speilberg was making his war movies as a kid in his backyard.

What would that have been like? Were the internet availble then would it have made Speilberg, or someone that good, into something that he isn’t today?

Doubt it.

Even though there is the potential with the internet to break down walls of distribution and access, people still have to make the right decisions. The internet doesn’t help you make the right decisions.

When I say “right decisions” I’m talking about the question that Lisa must be asking of herself “now I have 75,000 views of my movie, now what do I do?” The best answer is to probably just keep on making the best content in the same manner. But the goal is to move forward and become a bit more than someone who posts funny movies on YouTube right!?
Here is the problem: How do you grow and continue to reach more and more people with progressively better quality content but do all of that without the help of old media concepts.

Brains always trumps technology.

I have yet to see a super star come from the likes of YouTube, MySpace etc. It’s possible and its going to happen. BUT, you gotta be smart, you gotta know how to do it, you gotta have a plan, you gotta know what you’re trying to do, you gotta know how to envision the end result, you gotta keep it goin’.

YouTube made it simple for the a la carte video watcher.

Its interesting that the BEST clips from TV shows or movies can be found there. Forget all the other stuff no one cares about. The user is so in control that she is essentially telling the content creator what is favored and what is not when she puts choice clips on YouTube.

NBC is getting smart.

Doing business with something as powerful as YouTube is the best move.

It makes sense that TV networks are adopting this easier and quicker than the music business has because TV is an ad based business model. YouTube can easily facilitate that.

The revenue stream for the music business comes from CD sales…or at least they want it to.

How can music be part of an ad based model?

Advertising creates a huge platform to work from.

How can the music business wrap its content with advertising. Its a much better, and easier way to pay the content creators.

To shareholders of major labels it makes the most sense to turn to ad revenue as the primary source of income.

More revenue=happy shareholders=an environment to create

This is the best time for a musician to create something that means anything.

And give it away. You gotta be smart today kids.

Think in the margins. Trying to mimic what your idols did on the surface doesn’t work. The idols that you look up to lived and created in the margins, and you should now.

If you think you can build something good, the internet will tell you how special it is.