The music industry has been undergoing significant transformations in recent years, and the COVID-19 pandemic has only accelerated these changes. As we look ahead to the future of the music industry in 2024, it’s essential to understand the trends and opportunities that will shape the landscape. In this article, we’ll explore the key developments that experts predict will impact the music industry, from the rise of user-generated content to the growing importance of non-DSP revenues. Let’s dive in and explore what the future holds for musicians, labels, and music-related businesses.
- Consumers as Creators: The Power of User-Generated Content
The role of music fans is evolving from passive consumers to active creators. User-generated content has already become a significant force in the music industry, driven by social media platforms like TikTok. However, experts predict that this trend will continue to grow in the next few years, extending beyond social media and into the metaverse.
In the metaverse, music fans will have even more opportunities to create content using music stems and visual assets provided by artists and labels. This elevated form of user-generated content will break down the barriers between the “artist” and the “fan,” allowing for more meaningful engagement and collaboration.
“The next stage of user-generated content will continue breaking the fourth wall between the ‘artist’ and the ‘fan’. Artists and labels will start providing music stems and visual assets to fans so that they can manipulate them and create their own content.” — BPI 10x10 Report
- The Rise of Creator Level Subscriptions
The streaming era has revolutionized the way we consume music, and it has also opened up new revenue streams for artists. In 2020, the number of U.S. subscribers for major streaming services increased by over 50%, and this growth is expected to continue. However, relying solely on streaming revenue can be challenging for artists, especially those who are starting their careers.
To address this challenge, many artists are turning to creator level subscriptions, building on the success of platforms like Patreon and OnlyFans. These subscriptions offer fans a more direct and intimate connection with artists, providing exclusive content, merchandise, and other perks in exchange for a monthly fee. By diversifying their revenue streams, artists can monetize their following and gain more financial stability.
“Artists are set to continue building their subscription communities, monetizing their following and benefiting from alternative forms of revenue streams.” — Variety
- The Growing Influence of Social Audio
Social audio platforms like Clubhouse have gained massive popularity in recent years, opening up new opportunities for musicians. Now, other tech and social media companies, including Spotify, Twitter, and Facebook, are jumping on the social audio bandwagon. This expansion of social audio functionalities will undoubtedly impact the music industry.
Artists and their teams can leverage social audio to host listening parties, performances, radio shows, and more, creating unique marketing opportunities and fostering deeper connections with their audience. By embracing social audio, musicians can engage fans in real-time conversations, build anticipation for new releases, and create memorable experiences.
“Artists and their teams can benefit from the marketing opportunities brought about by social audio functionalities by hosting listening parties, performances, radio shows, and more.” — BPI 10x10 Report
- Music and Tech: An Unbreakable Bond
The relationship between music and technology has always been intertwined, and this bond will continue to strengthen in the coming years. Emerging technologies like 5G, smart speakers, and smart cars will require collaborations between tech companies and artists to showcase their products and services.
One area where this collaboration is already evident is in the development of creator tools. According to MIDiA, creator tool development is a billion-dollar-a-year market, which is expected to double in the future. Artists and labels collaborate with development companies to create artist-branded sound packs, production software, and music-making apps. As artists become content creators themselves, development companies endorse artists, who, in turn, recommend the company’s software to their followers.
“Music is set to continue pushing the tech industry’s boundaries, and vice versa. Emerging technologies such as 5G, smart speakers, and smart cars will require tech companies to partner up with artists to showcase their wares.” — BPI 10x10 Report
- AI as a Powerful Tool for Music Industry Professionals
Artificial intelligence (AI) has already made its mark on the music industry, particularly in areas like music recommendation algorithms. In the future, AI will become an even more powerful tool, helping labels, bookers, and managers automate repetitive tasks and streamline workflows.
AI can be used to respond to repeat queries, analyze algorithms, and automate administrative work, allowing industry professionals to focus on more complex tasks. By harnessing the power of AI, music industry professionals can enhance efficiency, improve decision-making processes, and create more personalized experiences for artists and fans.
“AI can be used by labels, bookers, and managers to respond to repeat queries so that they can focus on more complex tasks. Through AI, workflows can be automated and algorithms can be analyzed without human intervention, facilitating the copious amount of admin work that’s behind every artist’s success.” — BPI 10x10 Report
- The Need for Robust Licensing Frameworks
As new technologies emerge, the music industry faces ongoing challenges in terms of licensing. While innovation and creative use of music should be encouraged, it’s crucial to establish robust licensing frameworks to protect artists’ rights and ensure fair compensation.
Labels and technology companies are working together to develop frameworks and deals that benefit all parties involved. This collaboration is essential for navigating the complexities of new technologies and ensuring that artists’ creative work is respected and properly licensed.
“Labels and technology companies are currently developing frameworks and deals that will benefit all parties. They will need to continue working together to ensure that artists’ rights are not violated vis-a-vis new technologies.” — BPI 10x10 Report
- Music-Adjacent Industries as Partners, Not Competitors
While it’s easy to view music-adjacent industries like gaming and film as direct competition, there are significant opportunities for collaboration and partnership. By embracing these industries, artists can expand their reach, tap into new revenue streams, and create unique experiences for their fans.
Rather than seeing these sectors as threats, the music industry should focus on how artists can benefit from collaborations with gaming and film. For example, creating original soundtracks for video games or partnering with film studios for exclusive music releases can provide artists with additional exposure and income.
“The music industry should focus on how artists can benefit from music-adjacent industries like gaming and film, instead of seeing these sectors as direct competition.” — BPI 10x10 Report
- NFTs and Blockchain: A Promising Revenue Stream
NFTs (non-fungible tokens) and blockchain technology have gained significant attention in recent years. While there has been hype around these technologies, they also offer promising opportunities for artists and the music industry as a whole.
NFTs and digital collectibles provide a new revenue stream for artists, allowing them to create unique and limited-edition digital assets that can be sold directly to fans. By leveraging blockchain technology, artists can ensure the authenticity and scarcity of their creations, providing a new way for fans to support their favorite artists while owning a piece of digital history.
“NFTs and the idea of digital collectibles are very much here to stay. They represent an incredibly promising and important new revenue stream for artists and for the music industry as a whole.” — Shara Senderoff, Partner and President at Raised in Space
- Redefining the Role of Labels
With the rise of independent artistry and the availability of digital distribution platforms, some have questioned the relevance of record labels. However, new technologies like NFTs and blockchain offer opportunities for labels to redefine their role and provide valuable support to artists.
Labels can embrace these emerging technologies to upskill, assist artists in navigating the complex world of fintech, and explore new revenue streams. By adapting to the changing landscape and leveraging technology, labels can continue to play a vital role in supporting artists’ careers and helping them reach their full potential.
“New technologies such as NFTs and blockchain mean that labels can redefine their scope and find a new purpose. Labels should see these emerging technologies as an opportunity to upskill and assist artists in navigating the complex world of fintech.” — BPI 10x10 Report
- The Importance of Long-Term Investments and Teamwork
In an ever-changing music industry, longevity and financial stability require long-term investments and effective teamwork. Artists should consider diversifying their portfolios and exploring opportunities outside of music to build sustainable wealth.
Investing in real estate, private enterprises, and other ventures can provide additional income streams and long-term value. Furthermore, building a reliable team of professionals, including managers, marketers, and creative collaborators, is essential for scaling and adapting to the evolving industry landscape.
“Investing in the right team is pivotal for an artist’s ability to scale and adapt through cultural currents. You stand to be making three-to-five times what you spend on staff that help you market, sell, manage, and create streams for your brand.” — Celebrity Growth Hacker
In conclusion, the future of the music industry in 2024 is filled with exciting opportunities and challenges. From the rise of user-generated content to the growing influence of social audio and the potential of NFTs and Blockchain, musicians, labels, and music-related businesses must adapt to these trends to thrive in the evolving landscape. By embracing new technologies, diversifying revenue streams, and investing in long-term growth, artists can build sustainable careers and connect with their audience in meaningful ways. The music industry is constantly evolving, and those who embrace change will be well-positioned for success.
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