Digital Revolution Tamed : The Case of the Recording Industry

This book explores why widespread predictions of the radical transformation in the recording industry did not materialise. Although the growing revenue generated from streaming signals the recovery of the digital music business, it is important to ask to what extent is the current development a response to digital innovation. Hyojung Sun finds the answer in the detailed innovation process that has taken place since Napster. She reassesses the way digital music technologies were encultured in complex music valorisation processes and demonstrates how the industry has become reintermediated rather than disintermediated. This book offers a new understanding of digital disruption in the recording industry. It captures the complexity of the innovation processes that brought about technological development, which arose as a result of interaction across the circuit of the recording business – production, distribution, valorisation, and consumption. By offering a more sophisticated account than the prevailing dichotomy, the book exposes deterministic myths surrounding the radical transformation of the industry. Digital Revolution Tamed Acknowledgements Contents Abbreviations List of Figures 1 Introduction 1.1 Digital Disruption in the Recording Industry: The Quest for a New Perspective 1.2 What I Mean by the “Recording Industry” 1.3 Major Predictions of the Digital Recording Industry 1.4 Outline of the Book References 2 Towards a More Sophisticated Account 2.1 Understanding Disruptive Technology 2.1.1 Technological Paradigms and Revolutions 2.1.2 Social Shaping of Technology (“SST”) 2.2 Sociotechnical Constellation of the Digital Recording Industry 2.2.1 Innofusion and Domestication 2.2.2 Learning by Doing, Learning by Using and Learning by Interacting 2.2.3 Learning by Regulating 2.2.4 Intermediaries 2.2.5 Meso-level Interactions 2.2.6 Networks of Music Economy 2.3 Case Study 2.4 Data Collection References 3 The History of Technological Developments in the Recording Industry 3.1 Evolution of Music Technologies 3.1.1 Fifteenth Century–Eighteenth Century 3.1.1.1 The Invention of the Printing Press 3.1.1.2 The Statute of Anne, the First Modern Copyright Law 3.1.1.3 Copyright and Authors 3.1.1.4 Copyright for Music 3.1.1.5 The Emergence of Publishers 3.1.2 Nineteenth Century—1910 3.1.2.1 Phonographic Industry 3.1.3 1910–1930 3.1.3.1 Radio 3.1.3.2 Collecting Societies 3.1.4 1940–1950 3.1.4.1 Magnetic Tape and Multi-track 3.1.4.2 Emergence of Piracy and International Conventions 3.1.5 1960–1980 3.1.5.1 Cassette Tape and CD 3.1.5.2 Mergers and Acquisitions 3.1.5.3 Copyright as an Economic Incentive 3.2 The Conventional Music Value Networks 3.2.1 Networks of Creativity 3.2.1.1 Music Production 3.2.1.2 Relationship Between Artists and Record Companies 3.2.2 Networks of Reproduction 3.2.3 Networks of Distribution/Promotion 3.2.3.1 Distribution Networks for Major Labels 3.2.3.2 Distribution Networks for Independent Labels 3.2.3.3 Marketing and Promotion 3.2.3.4 Pre-Selection 3.2.3.5 Publicity 3.2.3.6 Radio 3.2.4 Networks of Consumption 3.3 Digital Technology in the Recording Industry 3.3.1 Digital Disruption in the Recording Industry 3.3.1.1 Views on Dystopian Vision 3.3.1.2 Views on Promising Vision 3.3.2 P2P Technology 3.3.2.1 P2P File-Sharing and Record Sales 3.3.2.2 Debates on Piracy 3.3.3 Technological Trajectory of P2P Networks 3.3.3.1 MyMp3.com and Napster 3.3.3.2 Aimster 3.3.3.3 Gnutella 3.3.3.4 FastTrack 3.3.3.5 Grokster and Morpheus 3.3.3.6 BitTorrent 3.4 Concluding Remarks References 4 Evolution of Digital Music Services 4.1 After the Wild West (1999–2001) 4.1.1 Legal Standards 4.1.1.1 The RIO 4.1.1.2 Secure Digital Music Initiative (SDMI) 4.1.2 Legal Digital Music Services 4.2 Apple to the Rescue (2001–2003) 4.2.1 How iTunes Saved the Digital Recording Industry 4.2.2 Limitations 4.3 Emergence of New Models (2004–2007) 4.3.1 Last.fm 4.3.1.1 Beginning 4.3.1.2 CBS Acquisition 4.3.2 YouTube 4.3.2.1 Evolution of the Business 4.3.2.2 Controversies and Limitations 4.3.2.3 Limitations 4.4 The Rise of Streaming Services (2008–Present) 4.4.1 The Decline of P2P File-Sharing 4.4.2 The Rise of Streaming Services 4.4.2.1 Spotify 4.4.2.2 Apple Music 4.4.2.3 Amazon Music Unlimited 4.4.2.4 Deezer 4.5 Concluding Remarks References 5 Case Study—Spotify 5.1 Background 5.1.1 Early History 5.1.2 Muddling Through Piracy 5.1.3 Sweden, the Kingdom of Piracy 5.1.3.1 Kingdom of Piracy 5.2 In Search of an Answer to Piracy 5.2.1 P2P Heritage 5.2.2 Free 5.2.3 Easy to Use 5.2.4 Legality 5.3 Remedying the Digital Recording Industry 5.3.1 Reduced Piracy 5.3.2 Increasing Number of People Paying for Music 5.4 From Streaming to Mainstreaming 5.4.1 Search and Social Sharing 5.4.2 Music Recommendation and Third-Party Apps 5.4.3 Browse (Playlist) and Spotlight 5.4.3.1 Browse (Playlist) 5.4.3.2 Spotlight 5.5 Puzzles Created by Spotify 5.5.1 Artists’ Earnings and the Value of Digital Music 5.5.2 The Paradox of Celestial Jukebox References 6 Digital Music Distribution Networks 6.1 Foundation of Digital Music Distribution Infrastructure 6.1.1 Lack of Infrastructure 6.1.2 Beginning of Legitimate Digital Music Distribution Infrastructure 6.1.2.1 Major Labels’ Path 6.1.2.2 Independent Labels’ Path 6.1.2.3 Emergence of Independent Digital Music Distributors 6.1.2.4 Technical Assistance 6.2 Digital Music Convergence 6.2.1 Direct-to-Fan (D2F) Revolution 6.2.1.1 Crowdfunding Participatory Platforms Artists’ Empowerment Modern Patronage System 6.2.1.2 Self-Distribution Equal Exposure Transparency 6.2.1.3 Artists’ Management Fan Building Fan Engagement Autonomy 6.2.2 Attention Economy 6.2.2.1 The Promise of Celestial Jukebox and the Reality 6.2.2.2 Tyranny of Choice 6.2.2.3 The Long Tail and the Attention Economy 6.3 Digital Music Value Networks Reconfigured 6.3.1 Changing Value Networks 6.3.1.1 D2F Networks 6.3.1.2 Networks of Creativity 6.3.2 Networks of Reproduction 6.3.3 Networks of Distribution/Promotion 6.3.3.1 Networks of Distribution Major Labels’ Struggles Windows of Opportunity for Independent Music Distributors 6.3.3.2 Networks of Promotion Diversified Promotion Channels Digital Music Discovery Radio Emergence of Independent Music Blogs Streaming Playlists 6.3.4 Networks of Consumption 6.3.4.1 Growth of Streaming Music Consumption 6.3.4.2 Increase of Vinyl Consumption 6.3.4.3 Increase in Festivals 6.4 Concluding Remarks References 7 Case Study—INgrooves 7.1 Beginning 7.2 iTunes and the Emergence of Digital Music Aggregators 7.3 Beyond Distribution 7.3.1 Marketing/Promotion 7.3.2 INresidence (Artist Services Division) 7.3.2.1 Global Distribution 7.3.2.2 Technology Company 7.3.2.3 Independents’ Expertise 7.4 Partnership with Universal 7.4.1 Universal’s Struggle 7.4.2 Partnership 7.4.2.1 Technical Level Playing Field 7.4.2.2 Opens Up Niche Market for Independent Distributors 7.4.3 Acquisition of Fontana Distribution 7.4.4 Implications 7.5 Concluding Remarks References 8 Digital Revolution Tamed in the Recording Industry 8.1 Recontextualising Digital Disruption in the Recording Industry Overcoming the Dichotomy 8.2 Messy Process of Digital Music Valorisation 8.2.1 Case Summary 1—Spotify 8.2.2 Case Summary 2—INgrooves 8.3 Demystifying the Hype of Digital Revolution in the Recording Industry 8.4 Discussion 8.4.1 Digital Technology 8.4.2 Copyright 8.4.3 Users 8.4.4 Business Model References Afterword Bibliography Index