Gerd Leonhard, Music Entrepreneur & ‘Music & Media Futurist’ www.mediafuturist.com www.gerdpresents.com CEO, www.sonific.com The “End of Control” and the Future of Music [email protected]2006 -some rights reserved - Gerd Leonhard Music Futurist [email protected]1
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Gerd Leonhard Presentation in Helsinki: The Future Of Music End Of Control Sept 8 2006
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Gerd Leonhard, Music Entrepreneur & ‘Music & Media Futurist’
Gerd Leonhard Music & Media Futurist www.mediafuturist.com
About me www.mediafuturist.com • Music & Media-Futurist & Author, Speaker and Presenter,
ThinkTank Leader, Strategic Advisor
• 20 years in music & technology, EU and U.S., Entrepreneur, Musician & Producer
• Berklee College of Music graduate, Quincy Jones Award Winner
• Digital Music Entrepreneur, latest venture: SONIFIC - Soundtracks for your Digital Life, previously: LicenseMusic
• Speaking activities around the globe: “The Future of Music & Media”, with a focus on business design for media companies, and helping industry organizations plan for the future
• Co-Author of the book “The future of music”, next book “The end of Control” coming in late 2006
Gerd Leonhard Music & Media Futurist www.mediafuturist.com
About those Digital Natives (and why it matters)
Marc Prensky:
• They are surrounded by digital media to such an extent that their very brain structures may be different from those of previous generations
• Digital Natives are used to receiving information really fast• They like to parallel process and multi-task • They prefer their graphics before their text rather than the opposite • They prefer random access (like hypertext).• They function best when networked. • They prefer games to "serious" work
Gerd Leonhard, Music & Media Futurist www.mediafuturist.com
To be more practical:★ For us, this means
• We must offer / sell unprotected and universally compatible music content, in order to really engage most of the users. On other words: there is no Safety Net
• We must stop using legislations based on outmoded copyright laws to shore up the beloved distribution and valuation models
• We must pursue a ubiquity model not try to maintain artificial scarcity
• We should let the users do the rating, tagging, and viral marketing
• We must respect and expand user’s rights, and re-earn their trust
• We must carefully consider where to put the toll-booth, and be much smarter with handling pricing, bundling and re-bundling
• We may sometimes need to forego immediate revenues for large scale exposure
The current market is not working Apple sells 45Million+ iPods - using music as a loss-leader Windows DRM-based services have serious problems if
used to-go, for now, and good services are destined for failure because of out-moded policy decisions
MP3 services work great but are effectively black-listed by the majors
80% of the market is STILL trying to control distribution The USER (aka consumer) is STILL severely under-served Digital music revenues could be 10x of what they are right now
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The fact is, we don’t control distribution any more -
like it or not.
And why would we want to when the USERs can do our
marketing for us?
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The REALITY of the digital natives
Listening to music = getting music Performance = reproduction Access is outmoding ownershipSo, why are we still trying to sell
MORE COPIES if we could also sell ACCESS? Why do we need the traditional copyright mechanism?
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The Flat Fee for Music Everybody uses everybody pays: one flat fee gets every
user a LOT of content on any and all networks And: it will ‘feel like free’ (i.e. payments are bundled) Labels: you can’t refuse to be distributed on digital
networks - just like you can’t refuse to be on radio The flat fee is only the beginning for music commerce Selling only a la carte / by the ‘unit’ does not make sense
for CONTENT in the digital ecosystem
2006 -some rights reserved - Gerd Leonhard Music Futurist [email protected]
A ‘Music Fee’ of approx 3-4 Euro /month (EU), sign-up via ‘music registry’
But: Cellcos / Telcos, ISPs, Media Companies etc would soon want to bundle the fee into their offerings
Music Fee ID and password would give the users access to any and all digital music services (TV, Wireless / Mobile, Internet…) - and builds a hugely valuable database!
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The MUSIC FEE is only the beginning: the real $$$ will come in from: