Streaming killed the download star! How the business model of streaming services revolutionizes music distribution

Electronic copy available at: http://ssrn.com/abstract=2587176

Volume VII Number 1 201 5 ISSN 2326- 8085

STREAMING KILLED THE DOWNLOAD STAR! HOW THE BUSINESS MODEL OF STREAMING SERVICES REVOLUTIONIZES MUSIC DISTRIBUTION

ABSTRACT

Timm Trefzger, Friedrich-Alexander University, Erlangen-Nurnberg, Germany Matthias Rose, Fraunhofer Institute for lntegrated Circuits, Erlangen, Germany

Christian Baccarella, Friedrich-Alexander University, Erlangen, Germany Kai-Ingo Voigt, Friedrich-Alexander University, Erlangen-Nurnberg, Germany

This article focuses on modern online music distribution and investigates the business models of music download shops compared to streaming services. For that, a literature review, as well as interviews with various industry experts representing different stakeholders of music distribution were conducted. lt is shown that the business model of music streaming services differs fundamentally regarding the revenue streams compared to music download shops. Further differences can be identified in terms of new customer segments, which are attracted by new channel characteristics, new payment models, as well as due to closer customer relationships. In total, this study particularly contributes to the understanding of the future potential of streaming services and highlights the need for download shops to review the long­term stability of their business model.

Keywords: Music lndustry, Music Distribution, Music Streaming Services, Business Model Innovation

1. INTRODUCTION

Music has an essential impact on various fields of daily routines and plays a vital role in our everyday life. Researchers have put a lot of effort in examining the influence of music from multiple angles , e.g. by analyzing its social or psychological functions (Hargreaves and North, 1999). Next to music's influence on aspects relating to human needs and identity, the business with music has become a huge economic powerhouse. In 2013 alone, the value of the recording industry totaled USO 15 billion (IFPI , 2015).

However, there is hardly any other industry that has undergone more transformation and has suffered more challenges in recent decades (Beer, 2008; Bockstedt et al., 2006; Premkumar, 2003). One major disruption within the music industry has been the impact of technological progress. Traditionally, music was a limited commodity. The music industry relied for a long time on the fact that physical media, like vinyl , cassettes or CDs, were necessary to store music in order to make it accessible to the public (Wikstrom , 2013) . Advances in music compression and broadband technologies , however, have posed a substantial challenge to the music industry and changed the ways of music making , music consumption , and music distribution (Jones , 2000; Rao, 1999). Meisel and Sullivan (2002) describe the changes within the traditional business model of the music industry through online distribution by arguing that the rise of internet usage allowed record labels and artists to bypass traditional retailers and therefore to revolutionize existing revenue streams.

The development towards decentralized , non-physical music storage and distribution has also been referred to as the "democratization of music" (Beer, 2008, p. 223) . This trend is also reflected in the fact that physical formats accounted for only 51 percent of music sales in 2013 , while, at the same time, non­physical, digital revenues have risen to 39 percent of the recording industry's global revenues (IFPI , 2015) . Although music downloads still have the biggest share in the digital music business model , their figures are dropping. Music streaming services, on the other side, are on the rise . Streaming refers to the consumption of music in "real time" without necessarily downloading the file . This model has become more and more attractive for record companies, since revenues can be generated either through advertising-supported streaming services or through streaming subscriptions , while especially streaming subscriptions have shown continuous growth (IFPI , 2015). Thus, the business model of music distribution is once more in motion and musicians and practitioners alike are worried if the transition from downloading to streaming can serve as a sustainable business model with future growth and profit potential (Dredge , 2014) . Following from this , it becomes visible that the music industry, and specifically

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music distribution, is about to undergo a fundamental change. Therefore, the aim of this study is to explore the new business model of online music distribution based on music streaming.

This article is organized as follows: The first section presents a theoretical overview about the concept of business models as weil as about business model innovations. The following section describes the methodology, including information about the sample, applied measures, and data evaluation procedures. After that, the findings of this study are illustrated. We close with a discussion, conclusions, and some thoughts about the limitations of this study.

2. LITERATURE REVIEW

2.1. Businessmodels

Generally, every company has a business model (Teece, 2010). In practice, the term "business model" has received a lot of attention during the emergence and burst of the internet bubble around 2000, where young companies often did not have to present a strategy, special competencies or customers in order to attract huge investments, but only needed a promising internet-based business model with hypothetical profits (Margretta, 2002).

Although the concept of business models has gained increasing attention in recent years, it is still a young matter in literature (Teece, 2010). A literature review by Stahler (2002) has shown that the term "business model" has been mentioned in only seven articles by 1990. However, ten years later, already around 600 references in the management literature existed. Zott et al. (2011) have investigated this time course until 2009 and present a strong positive trend starting in 1995 regarding the number of published articles in academic as weil as in nonacademic journals, which deal with the concept of business models. Therefore, Zott et al. (2011) argue that this positive development represents the increasing importance of business models within academic literature. Yet, it is assumed that this development has even more progressed in practice, what underlines the need of further studies addressing this concept.

While various studies have investigated business model related topics, a common understanding of the concept is still lacking. Hence, many different definitions do exist (e.g. Sieger and Krys, 2011; Chresbrough and Rosenbloom, 2002; Schallmo, 2013; Teece, 2010; Zott et a/., 2011 ). Amit and Zott (2012), for example, view a business model as a system of dependent activities, which determines the way of how a company makes business with its customers, partners, and suppliers. Other authors define business model as a collection of answers to the questions "Who?", "What?'', "When?", "Where?", "Why?", and "How much?" in the context of providing products or services (Mitchell and Coles, 2004). A simpler understanding is presented by Tankhiwale (2009), who simply describes a business model as a company's way of making money. Due to many differing understandings, Zott et al. (2011) try to identify a common core of their reviewed definitions, which in general is the description of how companies create and capture value.

A simple yet comprehensive framework to structure business models is required to satisfy the purpose of this study. Therefore, we apply the business model canvas presented by Osterwalder and Pigneur (2010). According to this framework (see figure 1 ), a business model can be described by addressing nine different building blocks. The center of the model is determined by the "Value Proposition" and describes all products and services which generate customer value. The field "Customer Segments" defines all customer groups that are relevant for the business. How a company communicates with its customers as weil as how it commonly reaches its customers is characterized in the field "Channels". Moreover, the framework depicts the types of relationships between the company and each of its customers segments ("Customer Relationships"). Since a company, at best, captures value, the field "Revenue Streams" characterizes the way of how the company generates revenues. Another aspect of the business model canvas is the notion how a company generates customer value. At first, "Key Resources" such as machines, buildings or know-how are required to run the business. The activities a company has to perform to generate value are described in the field "Key Activities". Furthermore, important suppliers and other partners are subsumed by the category "Key Partners". Finally, generating value always involves certain costs, which are characterized in the building block "Cost Structures".

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FIGURE 2. BUSINESS MODEL CANVAS

Key Activities Customer Relationships

Key Partners Value Customer

Proposition Segments

Key Resources Channels

Cost Structures Revenue Streams

2.2. Business model innovation

Fora long time, innovations have been related to products, services or processes. Today, the concept of business model innovations complements the classical innovation types (Chesbrough, 2010; Stahler, 2002; Wirtz, 2011; Zollenkop, 2006). Studies have shown that companies now generate as much value by innovating their business models as they obtain by developing new products (Chesbrough, 201 O; Mitchell and Coles, 2004 ). For some firms, the relevance of business model innovations even exceeds the importance of product innovations (Reinhold et al. , 2011 ). While many studies have addressed the relevance of business model innovations for a company's success, management literature still lacks a clear understanding of this concept (Wirtz, 2011 ). Mitchel and Coles (2004 ), for example, characterize a business model innovation as the development of a new product or service coming along with changes of various elements of the business model. In a first approximation towards a clearer definition, Zollenkop (2006) postulates a certain novelty grade of a business model , together with an already successful implementation. Moreover, Amit and Zott (2012) define business model innovations as new activities, new connections of existing activities, or changes regarding involved stakeholders performing their activities. In contrast to that, Markides (2006) supports a narrower perspective on business model innovations, which requires a business model being fundamentally new for the concerning firm. Additionally, the new business model has to lead to a more advantageous situation for the company. Lindgren (2012) as weil as Tankhiwale (2009) both argue that a business model innovation requires the change of one or more elements of a business model. However, when this change only affects products or services, the authors refuse to characterize this as an innovation of the business model.

Following the similarities of the presented ideas, it becomes visible that those definitions mostly require changes on the component level of a business model , which means that certain business model elements have to change. Another view is supported by Johnson (2010) and Wirtz (2011) who understand business model innovations also as a process. While Wirtz (2011) argues that the process of changing the business model has the aim to secure or gain a competitive advantage, Johnson (2010) considers the process as a way to conduct changes concerning the business model core in terms of new skills, new strengths or new revenue streams. Although a unified definition is missing, the prevailing view on business model innovations is, however, the component-oriented perspective (Wirtz, 2011 ).

To visualize the differences between music download shops and streaming services regarding their typical business models, we require a clear understanding of business model innovations. Therefore, in this study we define business model innovations as changes within one or more building blocks of the already described business model canvas . According to the perspective of Lindgren (2012) and Tankhiwale (2009) , sole changes in terms of the value proposition are yet not sufficient to refer to as a business model innovation . On the basis of these considerations , we formulate the following research question:

Research question: How did the business model of streaming services transform the existing business model of music download shops?

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3. METHOD

To find an answer to the research question, the analysis contains two stages. First, we analyze the business model of music download shops. Since this business model is already well-established, a review of the relevant literature has been conducted. In contrast to download shops, many important insights about music streaming services cannot be found in publications yet. Therefore, in-depth interviews with various industry experts have been performed. The interviews were structured by a guideline to ensure comparable results. Before conducting the actual interviews, a pretest with two researchers was performed to refine the questionnaire and secure its validity. The final questionnaire was structured according to the nine building blocks of the business model canvas (Osterwalder and Pigneur, 2010). In general, experts are characterized by specific and deep knowledge about a certain field or topic as weil as by privileged access to certain information (Lamnek, 2010; Mayer, 2008). For this study, we identified six experts who all show strong ties to the music industry. All experts, however, view the music industry from significantly different perspectives due to their professional background. In the following, we provide an overview about the anonymized experts' backgrounds.

Expert 1 has studied music before he started working for a record company and later for a music software firm. Afterwards, he became Chief Technology Officer (CTO) of a commercial music streaming service. Expert 2 received a university degree in business studies and is today responsible for sales marketing as weil as strategic marketing at a music distribution company. Among other things, Expert 3 manages his own - solely digital - record company, which can be classified as an independent music label, as weil as a production company. With his work, he has received various awards, including two Grammy Awards. Expert 4 works as a professional journalist for a notable music magazine and is specialized on the digital music market. Expert 5 is a lecturer at a German university and teaches in the field of music business. Moreover, he has additional lectureships at other German universities focusing on the music industry. Expert 6 is a full professor for music business at a US university. His department is one of the departments with the langest history specializing on the music business. He is also active as an independent consultant in the music industry.

After all interviews have been conducted, the interview recordings were transferred into written documents to filter out the relevant messages. This was done by performing a multi-stage process of gradually figuring out relevant statements of all experts and to finally aggregate the remarks towards structured content blocks. Before we present those findings, which are again structured according to the nine categories of the business model canvas, we discuss the typical business model of music download shops in the following.

4. FINDINGS

4.1. The business model of music download shops

Value proposition: The central value of music download shops like e.g. iTunes is the possibility to access music on a more individual level as weil as mostly cheaper compared to previous ways of buying music. The main difference to traditional music distribution is the fact that customers of music download shops can buy single tracks instead of necessarily buying the whole album, which has been the established way to consume music. For example, a customer who likes three songs on an album, now solely purchases those songs instead of the whole record. Thus, the customer spends less money on music than before and the price-performance ratio improves significantly from a customer's point of view (Hutzschenreuter, 2000; Zollenkop, 2006). Furthermore, it is very easy to pre-listen to a sang before buying it. This reduces the probability of a "bad buy" considerably (Wirtz, 2011 ). An additional benefit of music download shops is the high level of comfort and ease. Customers may conduct their music purchases from harne, instantly have the desired music in their "hands", and the interaction with mp3 players like apple's iPod is very easy, too (Apple lnc., 2015; Osterwalder and Pigneur, 2010).

Customer segments: In general, music download shops try to reach everyone who likes to listen to music. Most important customer needs are: ease-of-use, fast purchasing, and a reasonable price-performance­ratio (BVMI, 2014). According to a survey of the BVMI (2014), which is the Federal Association of the Music lndustry in Germany, 10.7 percent of the German population can be characterized as music

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download shop customers , which is a typical ratio for western cultural areas at the moment. Most revenues are typically generated by customers in the age dass of 20 to 49 years.

Channels: The main channel between music download shops and customers is the shop website or the software (e .g. iTunes), where customers can access the music (Koh et a/., 2014). According to Osterwalder and Pigneur (2010), exclusive channels are commonly advantageous due to higher profit margins. Yet, providers face higher fixed costs because of instailation, administration, and maintenance. Websites or software simultaneously can act as communication, distribution, and sales channels. From the perspective of the music industry, music download shops can be seen as intermediates that represent indirect channels between music producers and customers (Wirtz, 2011 ).

Customer relationships: Music download shops can be characterized as automated services (Osterwalder and Pigneur, 2010). On the one hand, customers are situated in a self-service environment where they can decide what songs they want to purchase. On the other hand, complex algorithms simulate personal relationships, as certain songs are recommended on a user-specific level due to individual behaviors (Briegmann and Jakob, 2008; Osterwalder and Pigneur, 2010). These recommendations increase the efficiency of the download shops for customers since they can access also "non-mainstream" music easier and faster than before (without extensive searching) (von Dyk, 2008).

Revenue streams: Generaily, music download shops grant licenses in order to be able to listen to the purchased music. Thereby, revenues are generated via one-time payments for each song or album. Factors such as high competitive pressure lead to relatively low profit margins for the vendors. Therefore, it is difficult for music download shops to work profitable (Jakob, 2008). One important reason for that is the important strategic role of music download stores for companies like Apple or Google. Those companies use music stores primarily to increase the attractiveness of their product portfolio (hardware and software) by offering music at very low prices (Caspar et a/., 2008; Steinkrauß et a/. , 2008; Tschmuck, 2008, 2013).

Key resources: The most important resources for music download shops are music licenses since they are required to seil music and therefore to generate revenues. Additionaily, a platform is needed , where the music can be purchased. In order to stay up with competition , it is furthermore important to have a strong brand (Keller, 1993; Madden et a/., 2006).

Key activities: In line with key resources, a key activity is licensing of music. A major requirement for download shops to be able to seil music is the acquisition of the necessary music rights (Arias and Ellis, 2013; Samuelson, 2013). Usuaily, record companies or labels own the rights (anciilary copyrights) to the songs of their signed artists or producers (McCourt and Burkart, 2003; Small , 2012). Additionaily, national licensing and coilecting societies such as, for example , the GEMA in Germany are responsible to protect and supervise the exploitation rights. This illustrates the great chailenge for internationaily operating download shops since legal regulations differ a lot between countries. Thus, music download shops have to negotiate separate contracts in all countries in which they want to operate (Ventroni , 2008). Other key activities involve setting up and operating a platform and also developing a strong brand (Jakob, 2008; Steinkrauß et a/. , 2008).

Key partners: Relevant partners result from the required resources and the performed activities. Most important partners are record companies or labels as weil as licensing and collecting societies. Moreover, network providers and sometimes partners, which develop and operate the platforms, are essential to run the business model.

Cost structure: The highest cost position for music download shops arises from purchasing the music licenses. According to Jakob (2008), the following composition is typical : Based on a retail price of 99 cents for a song, 70 cents have to be paid to the owner of the rights. With the remaining 29 cents , the music shop provider has to pay 10 cents for payment systems and 10 cents for developing the brand and acquiring customers . Furthermore, 3 cents relate to personnel costs and customer service. Transmission costs as weil as costs derived from setting up and Operating the platform are responsible for additional 1 cent. Following this , every song download generates a loss of 4 cents (Jakob, 2008). However, costs per unit are significantly dependent on sales , considering economies of scale .

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After characterizing the business model of download shops, the paper analyzes the business model of music streaming by referring to the conducted expert interviews.

4.2. The business model of streaming services

Value proposition: The music library of streaming services contains a comparable number of songs as in the case of download shops and the music shows a comparable quality level, too. However, in contrast to music download stores, where customers pay per song or album, streaming services offer unlimited access to a comprehensive music library. As long as customers pay the subscription fees, they can access the whole music pool and listen to every song as often as they want. Many streaming services also offer an ad-based service without a subscription fee. The interviewed experts additionally emphasized that streaming services are often specifically optimized for mobile devices and therefore mainly used on those. Furthermore, they contain recommendation systems and are closely linked to social media services such as Facebook, which is beneficial for customers as it helps to access individually favored music. Although customers typically need an Internet connection to listen to music, most subscriber-based streaming services offer the possibility to download songs to a device. However, once the subscription of the streaming service is terminated, also the locally stored songs are not available anymore. In total, the interviewed experts agreed that the way of consuming music via streaming services is even more comfortable compared to download shops.

Customer segments: Taking into account typical customer segments of music download shops, the interviewed experts stated that customers of streaming services are (in average) younger and have an increased affinity to technology. However, this difference will decrease over time, according to the experts. Since it is very easy to access a lot of music without facing additional costs, streaming services also gain new customers who may have downloaded music illegally before. The experts believe that this has an impact on music piracy although the decline has not been as great as expected so far. A further difference is that customers who purchase music in download shops make conscious decisions to purchase a specific sang or album. In contrast to that, streaming services are more used like a traditional radio, where music has more of a background character.

Channels: Similar to music download shops, streaming services are intermediates between music creators and music consumers through the means of platforms like websites or software applications. According to the interviewed experts, the main difference is that streaming services are more likely used on mobile devices, e.g. via smartphone applications.

Customer relationships: At first sight, customer relationships in the business model of streaming services are comparable with those of download shops. However, the interviewed experts highlighted that streaming services enhance the idea of recommendation systems through letting customers connect easily with other friends, e.g. via social media platforms. Furthermore, the possibility to create individual playlists or to download music for offline listening, which can only played back as a subscriber, further strengthens the relationships between a streaming service and its customers and makes it more difficult for customers to terminate the once established relationship.

Revenue streams: While music download shops generate revenues mainly through selling individual songs or albums, streaming services gain their income with advertising as well as through recurring subscription fees. Streaming services typically offer a standard and a premium service. In most cases, the standard service is free, but there are commercial advertisements in between songs, which is similar to traditional radio programs. By paying e.g. monthly subscription fees, customers may listen to the music without commercial breaks. According to the interviewed experts, most streaming shops do not operate profitably at the moment. Yet, this may change due to a significant increase of customers. However, right now, the experts doubt that streaming services will meet the necessary subscriber growth rate since customers' willingness to pay for listening to music is generally low.

Key resources: Music licenses are the most important resources of streaming services as weil as of music download shops because the licenses are required to be able to provide access to the music library. According to the interviewed experts, a major difference of streaming services compared to download shops are significantly higher internet bandwidth as weil as overall data volume needed to operate a streaming service.

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Key activities: In line with key resources, a major key activity is to gain access to music licenses. Those have to be purchased by the streaming services according to the same general conditions that apply to download shops. The interviews with the industry experts have shown that at the beginning of streaming services, acquiring music licenses has been very difficult since the new subscription-based model has been a very innovative way to distribute music. However, after coming to an agreement with music right owners, it has become as simple for streaming services as for other music distributors to license music. Yet, this is not the case for some artists (e.g. AC/DC, The Beatles, Taylor Swift), whose songs currently are not available on streaming services such as Spotify. According to the interviewed experts, the artists (or the right holders) are concerned regarding the new way of distributing their music and how to earn money with it. In line with download shops, further key activities of streaming services include setting up and operating a platform and also developing a strong brand.

Key partners: Partners, which are required to run the business model of streaming services, do not differ a lot from those of download shops. The interviewed experts agreed that most important partners are record companies/labels as weil as licensing and collecting societies. Other important partners are network providers and partners which are responsible to develop and operate the platforms.

Cost structures: Similar to download shops, the right owners of songs receive around 70 percent of the revenues generated by streaming services. According to the interviewed experts, further cost positions include personnel costs as well costs related to the key resources. As streaming services require a greater bandwidth than download shops, they face higher costs regarding this point.

5. DISCUSSION AND CONCLUSION

Regarding the customer value of download shops and streaming services, a lot of similarities exist. Customers can access huge music libraries, normally including almost all relevant songs or albums. However, while customers download and pay their individually purchased music in download shops, customers of streaming services can access the whole music library immediately. Therefore, streaming customers feel that they potentially can listen to a lot of music while paying relatively less money. Additionally, the act of accessing a song and the act of paying are separated, which might lead to the feeling as if the music would be free. The higher perceived freedom of streaming services is very likely an important reason why streaming services attract new customer segments compared to download shops. Especially music consumers, who preferred downloading music illegally before, are attracted by the new services. Another important factor is the high popularity of using streaming services on mobile devices. Particularly, younger people use their smartphones to listen to music on the way. Typically, younger people have less income. Thus, standard services with commercial breaks instead of monthly fees are especially attractive models for young people, still having the possibility to eliminate the commercial breaks by subscribing to a premium service later. The perceived disadvantage of not owning the actual songs or albums is counteracted by the possibility of downloading a certain number of streaming playlists to a mobile device, which makes streaming services compared to download shops even more attractive from a customer's point of view. Moreover, customer relationships generally have gained a deeper level due to streaming services' efforts in improving their recommendation systems, including already compiled playlists, which consumers can access. Following from those considerations, it becomes apparent that the business model of streaming services noticeably changed regarding customer segments, relationships, as weil as in terms of channel usage.

Probably the most relevant change derives from the way how revenues are generated. Typically, subscriptions with monthly fees as weil as free services containing commercial breaks replace classical payment plans, where customers pay for each song or album they purchase. In contrast to that, no remarkable changes are visible in terms of needed key resources, performed activities and required partners. Therefore, changes regarding the cost structures are insignificant. In total, relevant changes are all related to the business model's value capture, specifically which customers are reached, how they are reached, and how they pay for the music. Additionally, although the core value of offering music has remained unchanged, customer value has changed significantly through the new characteristics of the channels, customer relationships, and revenue streams. The findings are summarized in figure 2 showing the extent of change (visualized by the black bubbles' size) from the download shop business model compared to the business model of streaming services for each of the nine building blocks. lt becomes

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apparent that the business model of streaming services can be clearly characterized as a business model innovation, following the understanding derived from the literature.

0

FIGURE 2. EXTENT OF BUSINESS MODEL CHANGE

Key Activities: lnsignificant

Q change • Value Proposition:

• Customer Relationships:

Moderate change • Customer Segments:

Key Partners: lnsignificant

change Key Resources: lnsignificant

Ü change

Significant change • Channels:

Moderate change

0 Cost Structures:

lnsignificant change

Moderate change

Revenue Streams: Fundamental change

The findings of this study indicate that the future possesses enormous challenges for the whole music industry. In general, it will be critical for music distributors to ensure profitability. This is especially true for streaming services due to their relatively short existence in the market and their mostly early stage of market penetration. Hereby, their success will be strongly dependent on subscriber growth rates. Another important challenge derives from the perspective of music creators. The conditions for artists and music producers have changed fundamentally with the rise of online music distribution. lt therefore stays critical to establish business models, which include adequate economic benefits for them since music creators form the essential backbone of the music industry. Artists, who complain about low financial income especially through streaming services, should also review their contracts with the record labels because a lot of those contracts origin from the time of physical music distribution and were therefore concluded under different market conditions. Moreover, the development of download shops in comparison to streaming services remains open. This study shows that the business model of download shops is seriously threatened by the new customer values granted by streaming services. Today, it is hardly imaginable that download shops will be completely replaced by streaming services. However, download shops have to conscientiously review their business model to oppose the new and aspiring competition. Finally, it becomes clear that music distribution has experienced a revolution in recent years and that this dynamic development is certainly not over yet.

6. LIMITATIONS AND FURTHER RESEARCH

Regardless of the given insights into modern online music distribution, this article possesses some limitations, which leave room for future research. The basis of this study are interviews with various industry experts. However, representatives of all relevant stakeholder could not be included. For example, the article lacks expert interviews with major labe! representatives. In addition, it would have been beneficial to specifically include more representatives from download shops as weil as from streaming services to gain a more complete picture. Future studies might put additional effort on gaining a higher number of interviews with relevant industry stakeholders. Although the interviews have been all conducted with acknowledged experts within the music industry and particularly in terms of online music distribution, derived assessments and insights might have a subjective character. However, generated statements coincided in most cases, which indicates that a !arger sample in a future study would help to overcome this limitation.

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AUTHOR PROFILE

Timm Trefzger is a Teaching and Research Associate at the Chair of lndustrial Management at the Friedrich-Alexander University, Erlangen-Nurnberg, Germany. His current area of research is located in the field of high-technology marketing, specifically focusing on communication activities in the context of technologically advanced products.

Matthias Rose is Head of Marketing Communications Audio & Multimedia at Fraunhofer llS. He is responsible for the global marketing and communication activities related to the application of audio coding and processing in broadcast, streaming and communication systems.

Christian Baccarella is an Assistant Professor at the Chair of lndustrial Management at the Friedrich­Alexander University, Erlangen-Nurnberg, Germany. His current research focuses on the cognitive perspective in technology identification and evaluation, technology marketing, and gamification in idea management.

Kai-Ingo Voigt is a Full Professor and Head of the Chair of lndustrial Management at the Friedrich­Alexander University, Erlangen-Nurnberg, Germany. His research interests include technology management, innovation management, idea management, industrial value creation, (corporate) entrepreneurship, procurement, business model innovation, as weil as production and operations management.

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