Last week MIDiA Consulting released a new report by Mark Mulligan regarding a UK consumer survey, "Decoding the Digital Music Consumer," that reveals only one digital activity in the top 5 music activities of today's consumers. Watching music videos came in second to that long-time winner listening to the radio. Third in line? Buying CDs! Takeaways include the fact that radio and CD's are far from dead and that there's lots of room for growth in the digital sector.
MIDiA Consulting's "Decoding the Digital Music Consumer," authored by Mark Mulligan, is a free report available not only to MIDiA Consulting's clients but to Music Industry Blog subscribers. If you're wary of getting too many emails, I can attest that Music Industry Blog's emails are low volume, low noise and very high signal.
UK Consumers: Discovering, Consuming & Interacting With Music
The above chart offers a big chunk of what musicians and labels will find of interest in this report.
The continued dominance of radio, tv and CDs is noteworthy though radio is clearly the only channel that truly dominates. One might well assume that radio's combination of free to the listener music and overall emphasis on major label acts and hits is a key part of what makes it so popular.
Though listening to free streaming music comes up 6th, watching music videos is the strongest digital activity by far. This is potentially good for all levels of the game given the growing usefulness of YouTube for marketing and revenue.
As Mulligan recently noted piracy is still a serious issue on YouTube. Yet YouTube remains a bright spot in the digital landscape with a growing ability to monetize previously unauthorized uses without forcing rights holders into the position of squashing all forms of fair use and shared culture to stop pirates.
Given the consumer emphasis of this study, one should not forget that the RIAA killed their brand in the public eye with broad attacks that swept up little old ladies and dead people in their net.
Speaking of Piracy
For me the report adds to the complexity of what we talk about when we talk about pirating.
The fact that the top digital channels for music, YouTube and related video streaming sites, were literally built on piracy should not be forgotten. However that doesn't make it an acceptable business practice. I consider YouTube's early piracy to be an artefact of a different time. Their current piracy is a different matter.
However, what YouTube has done is made it possible to work with behaviors labeled as piracy at a time when we're realizing that filesharers also buy music.
The report finds:
"Music subscribers are the most ardent pirates."
"More than a quarter of music subscribers are regular P2P users, making the segment most likely to pirate music. This is not evidence that streaming drives piracy, rather that some of the most engaged music subscribers are also engaged pirates. This apparent contradiction is a long-standing feature of the digital music marketplace."
This is the kind of finding that troubles those stuck in a binary perspective, victims of a linear worldview, incapable of dealing with the reality that confronts them.
"P2P is not the only piracy game in town."
"Non-Network Piracy?" Oh sh*t! I thought it was our generation taping vinyl back in the day that was the problem but these kids today. They've got bluetooth and USB drives and who knows what else!
Keep in mind that while P2P filesharing is one to many, Non-Network Piracy is more often one to one. You know, like friends actually sharing things. That's what friends do.
Churn, Baby, Churn!
There's a lot in this report for people with strong business interests in streaming music services which is good since that's who it's written for. In particular, the skew towards male listeners on streaming services does not reflect earlier gender balance among listeners and leads me to the conclusion that studying why that is and responding to the situation should be a no-brainer for music services.
Given the still backwards nature of music and tech industry discussions around gender I'm guessing growth hacking will remain of greater interest.
Yet even growth hacking may not be enough to deal with the issue of churn.
Only 32% of music subscribers polled don't plan to churn but that's what they're saying now. I wouldn't even take the 32% as something to count on.
As Mulligan notes:
"Cancel a music subscription and all the music in the world is still immediately available – for free - on YouTube and on Torrents, as well as countless radio stations, TV channels, music TV shows, without even considering the ex-subscriber’s own music collection."
"Cancelling a music subscription simply turns off the tap on convenience, not on the content itself, and the share of people that are willing to pay 9.99 a month for convenience is not exactly vast. This is why music subscription services need to up the innovation ante, to the extent of considering their current propositions as little more than the fuel for the engine."
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Hypebot Senior Contributor Clyde Smith (Twitter/Facebook) is building a writing hub at Flux Research. To suggest topics about music tech, DIY music biz or music marketing for Hypebot, contact: clyde(at)fluxresearch(dot)com.