The music industry has changed beyond all recognition in the last 20 years. There are lots of reasons why mostly connected with the digital revolution. Do young music artists want a record deal with an advance or would they prefer to sell their own music? The record companies still face the problem of illegal downloads. Do they continue to release albums or opt to release individual songs?
It is somewhat ironic that a digital technology led the companies to return to selling singles. Customers previously had to purchase albums just to get a song they liked and very few were you liked even 50% of the songs. People prefer one song a time digitally or free.
So what precipitated the change and what will the music industry look like in a decade?
The birth of the internet changed the entire commercial landscape. There had been a slow move away from analog towards digital reproduction but this combined with cheap distribution online proved disastrous. The record companies had thrived in an era when physically producing and distributing music had value. In a digital world, it is possible to make as much money from 100 small internet hits as there is from having one big physical hit. Napster was a game changer in an industry already in trouble.
The record companies could have adapted. Instead, they came late to selling music online insisting on digital rights management. An absence of legal, paid for downloads led to a vacuum one quickly filled by peer to peer file sharing. Kids by now had also gotten used to free music if illegal music making it hard to argue the case otherwise. The industry persisted in punishing consumers charging inflated prices for CD when the costs of production had collapsed. Digital downloads should have made it possible to slash prices but with prices at around 99p a pop music track, piracy remains attractive.
Today we have a limitless number of choices Youtube music, live music and music for free, when content is infinite the only concerns are convenience, taste and trust. The record companies that will survive are those who recognise that real value is in facilitating the purchase of music making it easier to buy than steal.