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10 Music Business Predictions For 2018


Here are ten music business predictions that can affect the music business in ways big and small for the coming year from Bobby Owsinski and other experts compiled by Exchangewire.

#1. Vinyl record sales plateau

Vinyl remains a viable niche business but its growth slows to single digits. Many young vinyl buyers get frustrated with the relatively slow process of actually playing a record, and many use marginal playback systems that don’t provide a sufficient audible difference over streaming, especially since many services are transitioning to hi-res audio. Most return to online platforms for quick and easy consumption.

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#2. Expect to see increased brand marketing investment

“Considering that music fans listen to nearly 10 more hours of music a week than they did just two years ago, it seems inevitable that brand marketing investments in the audio space will be quick to follow. This is already happening as the world’s biggest advertiser, Procter & Gamble, has reallocated major amounts of ad spend into audio. Of course, any advertiser looking to follow P&G’s lead will need to ensure that their advertisements in audio, whether through music or podcasting, enhance (not interrupt) the fan experience.”

Rosemary Waldrip, VP of Marketing, Music Audience Exchange
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#3. 2018 will see advanced levels of sophistication

“This year we’ve seen forward-thinking brands deliver impactful digital audio campaigns powered by intelligent measurement tools such as DAX’s Listener Insight ID. Brands now have access to deeper audience insights on digital listening that allow them to plan, optimise, and measure their campaigns in a way that simply wasn’t possible before. In 2018, we expect to see advertisers deliver advanced levels of sophistication using digital audio alongside TV, OOH, and other online formats.”

Oliver Deane, Global’s Director of Commercial Digital, DAX

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#4. Open marketplace monetisation will drive growth

“In 2018, digital audio and podcasting will increasingly be embraced by broadcasters, agencies, and advertisers worldwide as an effective medium for reaching target audiences. The widespread adoption of smart speakers will continue to play a significant role in the utilisation of digital audio as a meaningful and powerful marketing vehicle. In addition, the ability to programmatically monetise all forms of digital audio through open marketplaces as well as private exchanges, including music, talk, and podcasts, to deliver relevant and actionable messages in a highly targeted manner will also contribute profoundly to the growth of the industry.”

Neal Schore, CEO, Triton Digital
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#5. Amazon grows the music streaming pie

Amazon gives its stand-alone Amazon Music Unlimited service a marketing boost, and because of exclusive deals thanks to #5 below, becomes a major player in streaming distribution. The company uses its platform prowess to increase sales of physical product and merch, and becomes an increasingly lucrative sponsor/partner for superstar artists.

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#6. Google gets its music streaming act together

Google consolidates its confusing music offerings (Google Play Music and YouTube Red) into a single service. While less challenging to market and easier for the consumer to navigate, the new service still struggles to gain traction against the market leaders at first, but manages to show growth by the end of the year thanks to #5. The launch of the new service stifles major label protests about the low royalty payout from YouTube throughout the year.

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#7. Streaming networks up their game

In an effort to further differentiate itself from the competition, Apple Music finally becomes an all high-resolution audio service with no increase in monthly price. Thanks to collecting hi-res masters for the last 5 years, its miles ahead of the other platforms, which have to scramble to keep up. Some users can’t hear the difference, but many can and feel its worth jumping through the hoops imposed to by #5 to maintain a subscription with the service.

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#8. Major labels lose the middle class artist

Lower income from catalog and physical product results in fewer and lower advances to artists. Artists and their managers realize that its better business not to sign with a major unless they’re on the cusp of superstardom, and opt to maintain a DIY approach with indie label support instead. The majors finally become aware that their marketing infrastructure is based on television, radio and print, media all in decline and ignored by their target demographic, and begin to place more resources online than ever before.

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#9. The #MeToo movement is going to take a lot of people in the music industry out.
Good riddance.

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#10.Spotify finally goes public, and the going gets tougher. 

The time comes for Spotify to finally make the transition that’s been promised to investors for so long. The company gets listed in 2018, but that just opens it up to new challenges. Questions about expensive office space, scrutiny of its metrics, and pressure from the major labels to drop its free tier increase. Growing competition (see #2 and #3), and usage caps (see #5) make growth more difficult than in previous years, which affect its stock price by the end of the year.

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