CMU: Will 2011 be the year of the access model in music?

October 21, 2010

by cmumusicnews

Ted Cohen, the former EMI digital man who has been working in the digital music space as a consultant through his TAG Strategic consultancy since 2006, reckons 2011 will be the year ‘access’ supersedes ‘ownership’ in the recorded music business.

There has long been a theory that subscription-based digital music services – so the legal version of Napster and, in the US, Rhapsody, and more recently the premium versions of Spotify et al – are actually the future of the recorded music industry, rather than iTunes style services where you pay a fee per track and get to keep the song forever. This despite the fact that in the early days of digital music it was iTunes that prospered while Napster struggled and numerous other players operating the same business model disappeared.

The subscription-based services are all about ‘access’, and the iTunes-style services are where ‘ownership’ comes into play. Some argue the latter has had more initial success because it is more similar to the record/CD model of music consumption we’ve all grown up with, but that, nevertheless, the access systems will come to dominate long term. Cohen is such an advocate of the access model.

And in a blog post on the MIDEM website, which follows a MIDEM-hosted debate in LA this week, Cohen argues that the access approach could actually start to dominate as soon as next year.

Cohen writes: “[This week’s] debate, as expected, was heated, but the consensus was stronger than ever. The growth of music services such as Spotify, Pandora, Napster, Rdio, Rhapsody, We7, MOG, Slacker and others will continue exponentially. The $0.99 download from Apple, Amazon, 7Digital and others will continue to decline. The need for ownership will be marginalised by convenience”.

He continued: “On this point there was some disagreement. Eric Garland, co-founder of Big Champagne, expressed that ownership will always matter to a certain segment of the music audience, while Vince Bannon of Getty Images expressed, and I heartily concur, that ownership is a dated concept”.

Finally, he concluded: “Vince and I both have Sonos systems in our homes, with access to Pandora, Rhapsody, Napster and iHeart Radio, along with others. These services obviate the need to continue to grow our personal collections at a dollar or euro a track, the economics don’t make sense any more. I’ve been evangelising the inevitability of the access model taking the spotlight for over eight years, I will continue to do so. I believe that 2011 is the year that access will eclipse ownership as the dominant revenue stream, I’ve bet my career on it”.

Cohen also reckons the rise of the access model is good news for smaller independent artists and labels, and he explains why in the full blog on the MIDEM site at this link.


Posted by Ted • Thursday, October 21, 2010 .