Friday, 12 October 2007

Record downloads in the UK and new distribution by Prince, Radiohead and the Charlatans, but is Facebook the next big thing in music distribution?

It is a number of years now since Napster radically changed perceptions on how music should be distributed and latest figures show that download sales in the UK will hit a record £163 million this year. However, 2007 will really be remembered as the year that truly marked the beginning of a new way of working between record companies and artistes. Downloads and alternative distribution have been prominent, but is Facebook Music could become the really big story by the end of the year???

In 2000 dance act Darude was signed by a label after his single 'Sandstorm' became a success across Europe through prominence on Napster. More recently the so called Myspace phenomenon helped people like Lily Allen secure recording contracts and subsequent fame. But these acts still saw a recording contract and record company distribution as the holy grail. The big change in 2007 has been prominent acts employing radically different distribution methods far outside of the traditional record company distribution channels.

Wranglings with his UK record label saw Prince seek another route to market for his new album. The Mail on Sunday moved quickly and put together arguably the best UK newspaper promotion for many years - Prince's new album was given away free with every copy of the Mail on Sunday. The promotion was so successful that, despite initial protestation, HMV felt obliged to to sell newspapers for the first time!

Radiohead are also distributing their new album in a novel way. They are allowing fans to download the new album in advance of general release, but rather than being available at a fixed price fans have been allowed to name their price (with the minimum being 1p). Clearly this has an element of honesty box about it, but to date the majority of downloaders appear to have paid around market price for the album - with 1p downloaders few and far between. The method of distribution has also created significantly more hype around the release than would have been generated otherwise.

The latest example of breaking conventions is from the Charlatans. They are releasing their new album for free through the XFM website. They are also making the bands new single 'You Cross My Path' available free to download from the same site on 22nd Oct. This again appears to benefit both parties (Charlatans have a distribution channel + exposure and XFM have a great USP from a band that sits comfortably with the XFM brand.)

Nine Inch Nails have now declared themselves a free agent and will release albums from their website and Oasis and Jamiroquai (both contract free) are considering following suit.

It is hard to see where this is going to end up though. Even though retailers are adapting their models (eg Woolworths and HMV promoting downloads) and record companies are doing their best to weather the storm, the recording industry will continue to evolve quickly.

The download market is predicted to hit £600 million by 2012 and even though Myspace and Last FM still have good traction in the Web 2.0 music space, what price on Facebook advancing in this area? Facebook applications such as iLike are allowing people to buy straight from iTunes, Facebook Groups are enabling fans to interact and Visual Bookshelf has expanded to take account of music and film. These are all examples of how Facebook could start to become a big player in music and as user numbers quickly increase the feasibility of this also improves.

Nick Burcher writes: "If the power of Amazon's 'other people who bought this also bought' can be expanded to read 'your friends on Facebook thought you would like' then word of mouth recommendation can be instantly fulfilled and traditional music distribution and retail methods will change forever."

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