I'm delving into the music business even deeper today and we are addressing the super fan micro economy what it exactly is, why artists need it, and how it will affect the artist revenue. Check out today's episode and read the article below for more information on this topic.
Direct Action
In 2008 Spotify came up with an innovation that made the problem of the time –piracy – effectively redundant. What’s required now are new innovations that make the current streaming model look like an alternative, not the only choice – to enjoy music.
Now is the time
Whatever streaming is now, is pretty much how it is going to be. The future of what streaming can be is already here, today.
Record labels and publishers have experienced strong revenue growth and improving margins. Their businesses have been improved
Artists and songwriters have more people listening to their music than ever before and more creators are able to earn income than ever before
However, this is a problem because all though more people are listening to more music and creator aren't making enough money!!
Streaming benefits rights holders more than it does creators.
Streaming music services are incentivized to drive consumption. What we need are additional models, incentivized to drive fandom. Streaming is a song economy, and we now need a parallel fan economy.
Music used to be all about fandom. It was the way in which people identified and expressed themselves – a badge of honor and a symbol of personality. Streaming has industrialized music, turning it into a convenient utility that acts as a soundtrack to our everyday life.
Fan Economy
So, what is a fan economy? A fan economy is one in which the value resides in the artist-fan relationship. The fan economy will be defined by diversity but what its constituents will have in common is being built around micro-communities of fans.
Micro-communities that are built around an artist’s 1,000 true fans (or even fewer) allow the artist’s most loyal and dedicated fans to drive revenue that is small to the industry but large to the artist. For example, an artist with 1,000 subscribers paying $5 a month would generate the same $5,000 a month that a million streams would deliver a record label.
Music rights holders have a model that works well for them, so now they need to ensure that their artists and songwriters have models that work for them too.