Midem 2010: Music, monetisation and mobile apps
Dominic Pride of The Sound Horizon presented the MEF workshop at the packed MidemNet Academy session (25 January 2010) entitled “Making a music app successful”. After a review of the current app landscape and an analysis of which types of apps are the most popular, Dominic outlined the 5 steps to app success.
Applications were identified as accounting for 18% of future revenues in MEF’s 4th Business Confidence Index and the music industry was understandably eager to engage fans and cash in on the apps phenomenon. To discover the ingredients of a successful music application and plan your app strategy with top advice from MEF members including Distimo, GetJar, Nokia and Shazam, be sure to download the MEF Midem App Presentation.
Monetisation
The overall theme running through the Midem conference programme this year was ‘monetisation’ and, with the inexorable rise of social networking, a popular topic was how to “convert attention into money”. Artists were urged to use Twitter, Facebook and blogs “passionately and personally” with the caveat that it must be genuine – not someone blogging on your behalf. Acknowledging that traditional music revenues such as CD sales are declining, there was discussion around alternative revenue streams such as synchronisation, ad-funding, freemium models, sponsorship and mobile applications, in particular, were a buzz topic.
Informa valued mobile music revenues for 2009 at $11.4 billion: 50% Ringtones, 25% Ringbacktones, 20% full-track downloads and the remainder streaming. However, they also pointed out that ringtone sales are declining in many regions and predicted strong growth for mobile music applications. Elsewhere during a panel on mobile applications, there was consensus that it was still early days and that business models remained “fluid” with free vs freemium vs paid apps as well as in app purchasing all featuring in the market.
Access
Ralph Simon, MEF Americas Chairman Emeritus, took the stage at MidemNet to share his ideas on music monetisation, underlining the growing role of mobile as the number of handsets and smartphones continues to multiply.
As creater of the word ‘mociology’ (how people use mobile in their daily life), he coined a new acronym “AA&R” referring to ‘access, artists & repertoire’: “Because it’s really about access – access to the social networks, and to the communities that build, drive and really sell music and music experiences around the world.”
Access was also a subject touched upon by Artist and producer Pharrell Williams who expressed concern that young people would be disenfranchised if they’re not ‘connected’. This point was picked up on by futurologist Gerd Leonard who claimed: “It’s in the interest of governments in emerging economies to enable connectivity as there’s a direct correlation with GDP growth. In these regions, mobile is often the first and only access device to the internet.”
Experiment
An interview with Kodak’s CMO, Jeffrey Hayzlett, told the “adapt or die” story of a company that had to reinvent itself due to massive structural change: in the space of 5 years, film roll sales plummeted from $15 billion to $200m. Hayzlett’s advice to other industries undergoing a period of restructuring: “Don’t play safe, go to the edge of the table. Be allowed to experiment and if necessary fail, although preferably fail quickly and try something else!”
As the music industry continues to evolve and tap into new revenue streams, mobile remains an innovative, fast-paced strategic ally for the music business. MEF is the natural partner to bridge the gap and create competitive advantage for our members who work in this space.
