Everyday of my current work life I talk about the music industry and what's going on. One thing that always comes back is the discussion about how good the days of the CD were in terms of revenue and how we have to see if those good old days will ever come back. One thing me and my conversation partners always agree upon is that never in the history of recorded music we saw the amounts of tracks, albums etc on offering and never before was it so easy to record. So in terms of revenue we are down, but in terms of music we are up.
Reading this article on Spotify today made me think and wonder about the news around the letter of NOKIA's CEO and what the music industry and Nokia have in common or what they can learn from each other.
Lets first talk about the music industry. What I mean with the music industry in this case, is the sum of all companies acting in the recording business, publishing also, but the burn is actually mostly happening with record companies. In the good old days these companies made tons of cash selling CD's and the decline of selling CD's is what causing the downfall. So it concerns the companies selling CD's successfully in the past mostly. The 4 Majors (Sony, UMG, EMI and WMI), the big independents etc. They are making less money and in order to protect themselves against going under they make it hard for digital companies, like Spotify to enter markets or make serious cash in doing so. The strange thing is that this same attitude creates opportunities for others (read RDIO). My point is that when you are on a burning platform and faced with death or a jump that most certainly will cause dead, most of us would rather die in the environment where they had so much fun and good times.So they just stick around and jump when it's too late.
Why would it be so hard for Spotify to get the US going? Why is it so hard for Nokia to reinvent themselves and come out with the next generation of connecting people? At the end of the day I think its because of ego driven executives, protectionism and politics. This results in fear of letting go and embrace the unknown, because the only thing that counts is the status quo.
The speed whereby companies trade places is unprecedented and must make each shareholder and ceo scared shitless of competition.
What can these companies and insutries do to save their business and move into a prosperous future? Jump and hope for the best? Or is their something less drastic and dangerous they can do to change? It must be difficult to navigate when there is so much at stake. But thinking of all of this and using my common sense I dont understand one thing.
Why not help Spotify to enter the US market asap, it seems that they are doing something right in other territories, so why not grant them the opportunity to do this anywhere else with terms that will actually work for both parties? Personally I think politics and shady behaviour of executives is what is realy blocking the industry from moving frwd. Personal gain or the intent to make some money from helping well funded start ups in their endeavours of establishing themselves is what causes lack of growth. Do I have prove of this? NO its just what I think and may not be true at all. But what I do know is that it doesn't make a lot of sense anymore how the music industry and the Nokia's of this world behave and try to shape the future. They all want to shape a future that is primarily good for the status quo. They believe they deserve this, because of their previous success. Again something that I think, they think.
The interesting thing about the future is that it gives a chance to anyone.
Some things will never change. There will always be people that make music and want to make a living out of it. People will always want to communicate and not build their own communication device. So the market stays the same, but the players in it change and come and go. My advice to the music industry is to focus on the people that make music in the first place and in the second place find partners that can help to make money with it.
Win back the trust of the people that make the industry and kill every executive that stands in the way of innovation. (just retirement will do fine too) Don't be afraid of shareholders and the decline of results, be afraid of losing talent and missing the next iTunes. As far as connecting people Nokia may have missed the boat and will have no other choice to to jump and die in the waves of the future. They might get lucky and be saved by some kid that holds the idea for the next big thing. But hope is a bad strategy when you want to build a future. Creating opportunity, hard work and risk is what is needed. But who dares? Probably not the executives at Nokia or the big record companies. Most likely new companies started by young people with bright ideas like Facebook, Google and so forth will change the game and make the future. Spotify may be one of these companies, who knows? I certainly don't know this. What I do know is that Spotify, BlackBerry, Apple, Google, Facebook etc. do a better job then Nokia, Microsoft, etc. They show their innovation every day to us and every day they create cool things that make their customers happy and look cool. Being involved in a high tech start up myself in the music industry and doing my best creating a better future for my customers, their customers and my stakeholders, I know one thing: Never stop questioning and never believe you deserve something just because you once had it. If I was the CEO of NOKIA, I would be talking to Facebook, LinkedIN and many other interesting tech companies and see how I could create a great experience. Also I would hire people that are not protecting the status quo and could even make me become obsolete and finally I would think of how my infrastructure devision could help my handset devision to become more advantage over competition. The next big phone? Ideas of transformer like phones that you can change in shape etc.. I don't know. Phones that tap into your brain and by thinking you communicate? It's all a bit farfetched if you ask me. The multi touch screen and the way Apple designed the iPhone and made it work like a charm and seamlessly integrated with app store, iTunes etc. Not a too big of a step and not too crazy. Just very well designed and implemented. Not a Windows operating system that doesn't work or Symbian system that doesn't work. My advise keep it simple and try to innovate in the direction: Faster, cheaper to use and cool. The latter means that phones and fashion have intertwined. People use their phone as fashion statement. Maybe Nokia should make a pink phone that vibrates in different ways and a blue phone that can send VMS messages ;-)
Recent Comments