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18 Music Week 24.02.12

VIEWPOINT

ACCESS vs OWNERSHIP
Music streaming: can the access model really replace ownership, asks Rara director Tim Hadley

OPINION
BY TIM HADLEY, RARA.COM DIRECTOR

NA
I \ / I ownership,
I
I whether
physical or digital, still accountsforthe lion's
share of music revenues across most markets
internationally. However, this landscape is changing
rapidly as physical revenues from CD sales continue
their terminal decline and high-street music retail
faces extinction.
Owning a collection of digital music files, while
still an important means of consumption for many,
is fast becoming outmoded and unnecessary.
This is down to way we manage and consume
music across devices.
The proliferation of connected consumer
electronics means that today it is hard to buy a
digital device that doesn't connect to either the
internet or to a mobile network. Everything from
cars to televisions are now becoming internetenabled; providing the ability to stream music.
Cisco predicts there will be more mobile connected
devices than humans by the end of 2012.
Today, music rights
holders are more
open to

ABOVE
File u n d e r
outmoded:
Still t h e favoured
means of listening
t o music,
collections o f
digital music files
should b e c o m e
increasingly
unnecessary
ABOVE RICHT
Tim Hadley: The
RaRa.com director,
w h i c h has more
t h a n 10 million
songs available in
its worldwide
c a t a l o g u e f r o m all
major music labels
and leading indies

BELOW
Social media role:
The growth of
legal access-based
music owes much
to ever evolving
social-media
platforms

licensing innovative music services than at

any time before. Over the last few years we
have seen the emergence of an increasing
number of innovative music services utilising the
cloud to enable seamless access to a user's existing
music collection, as well as on-demand access to a
vast catalogue of licensed repertoire across a broad
range of connected devices.
Consumers are starting to realise the benefits of
being able to access and play music on multiple
devices on-demand without having to rip, plug in or
manually synchronise their music collection from
PC to iPod, tablet or mobUe.
This has resulted in a sizable shift towards
access-based consumption as new digital music
services are brought online which stream music to
consumers over the internet and via mobile
networks. Subscription has become the fastest
growing area within digital music today.
The number of subscribers using these services
globally grew by an impressive 65% last year,
reaching almost 13.5 million people according to
the IFPI whUe the BPI report subscription
revenues up were up nearly 50% over the
last year here in the
UK. Research
undertaken by
Gartner predicts that
consumer spending on
digital music subscription
services wiH almost triple
by 2015.
Social media is playing
\
a central role in the

explosive growth ot legitimate access based music

consumption with the majority of digital services
now integrating with existing social channels
like Facebook, Twitter, Google+, as well as
providing sharing and recommendation platforms
of their own.
However, there is a still a way to go before
digital music services, either access or ownership
based, reach the penetration levels needed by the
music industry. Today less then 20% of internet
users are paying for digital music online on a regular
basis and the majority of consumers have yet to try
any kind of digital music serv^ce.
Many of the existing digital services are fighting
over the same 20% of consumers rather than
looking to cater for the needs of the mass market
yet to make the move to digital music consumption.
Addressing the needs of this thus far neglected
group of consumers will be key if legitimate music
consumption is to prevail over the illegal alternatives
as consumers move their music listening online.
Access-based services are well placed to
answer this need, removing the need for
consumers to manage digital mediafilesand
instead focusing on providing more accessible,
easier to use services which make listening to
music across your devices as easy as turning on the
radio or putting a CD on.
An increasingly positive global music licensing
environment, pared vnxh the widespread availability
of affordable high-speed internet and mobue data
plans across an ever growing range of connected
devices means that the stage is set for access based
consumption to expand rapidly in 2012 and beyond.

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