In recent years, how has media ownership changed in one industry that you have studied?

In the past, the music industry dictated distribution and consumption habits to the audience. You had to go to a shop to buy your CDs, and the industry controlled how much you paid, the availability of the CD and how you listened to it. But recent technological developments have meant that the audience now have much more choice over how they purchase and consume music. This is a result of the internet.

An example of this switch to digital distribution is the collapse of pinnacle, an independent distribution company who distributed CDs for over 400 independent labels. The increase in digital downloading and sites such as myspace meant music fans could get this music easier online so stopped buying it in the shops. This led to the company going into administration. Matthew Tait said the collapse was due to “the sudden and steep downturn in the economy.”

In 2003, Eric Nicoli, then head of EMI records, stated that ‘digital [music] is the way forward for industry growth.” Over the past 6 years, the record industry has seen a 940% rise In income from digital sources. However, software like bearshare and frostwire don’t make it easy. It is estimated that 95% of music downloaded is downloaded illegally, representing a potential loss of $30bn a year for the industry.

Consumers don’t see anything wrong with this, according to a 2009 ‘youth and music’ survey in which 70% of 15-24 year olds said they don’t feel guilty about illegal downloading. So how can the industry deal with this problem?

EMI started by going online; to the place where the audience were. They needed to interact with their audience who were already taking ownership of the music away from them; an idea suggested by Avril Lavigne manager Terry McBride when he said ‘what the industry need to do is monetise the behaviour of that fan.’ Parolophone, an imprint of EMI created a website for Lily Allen, using synergy to sell the artist. Lily Allen already had a large Myspace following, and kept in close contact with her fans through this and her blog. Parlophone therefore included lots of interactive elements, allowing the fan to remix some of her tracks for a personal touch, or to play a game to win a free sample of her music. This game could be emailed to a friend, and spread around the web. EMI were using Lily Allen fan’s social networks to do the marketing for them; an example of viral marketing. After the radio, youtibe is now the most popular way for young people to find new music. Lily Allen now has her own youtube channel along with links to her videos on the site. The audience have taken the power away from the record labels, and this website gave the fans more of what they wanted; close contact with the artist and ownership of her music.

EMI also noticed that convergent technologies such as mobile phones were allowing their audience to listen to more music on portable devices. As part of a £40 million deal with

Robbie Williams, they released a memory card for mobile phones that contained some of his music. 1 in every $10 spent by young people globally is spent on mobile technology. That’s eight times more than is spent on music. EMI needed to access this market. More recently, mobile devices can download songs directly from iTunes and Amazon, and phone packages come bundled with free downloads, so the need to connect with these technologies is clearly being addressed

Since the internet has caused a widening of choice about where and how the audience listen to their music, the music industry has had to work harder than ever to keep consumers happy, especially when 61% of young people think a fair price for music is zero (Youth and music survey). Fan loyalty and contact with artists, as well as keeping up with new technology have become the main concerns for major labels such as EMI . They have had to start listening to their consumers more, and no long have such power as the consumers will go elsewhere for their product if they can find it cheaper and more conveniently. Perhaps major labels like EMI will have to accept that they no longer have a place in the music industry. With websites such as Myspace allowing the Arctic Monkeys chart-topping success without any label support in 2005, the power is now truly with the people.