Windowing Music—A Window of Opportunity?

You can’t talk about the music industry these days without hearing discussions of how to fix the business model and bring an end to rampant piracy. Anyone involved with selling music wants to know how to recapture profits in our increasingly digital world and stem the tide of “free music.” How do streaming platforms like Spotify, Rhapsody, Pandora and YouTube change the purchasing behaviors of consumers? How can music artists and labels ramp up sales and convince consumers to buy rather than stream or steal? The SOPA laws failed, making it clear that attacking pirates is probably not the way to solve the challenge of monetizing digital content. So what is the answer?

Some think that “windowing”—releasing content in different distribution channels in a phased schedule—is something the music industry should embrace to increase sales. The film industry is famous for their windowing model. Releases are first only available in (highest priced) theatres, followed by a period of DVD or On-Demand sales, and finally—28 or more days later—availability on Netflix. This model assumes that if you want to see a film badly enough when it first comes out, you’ll pay more to see it.

In the music world, windowing might work like this: songs would only be available on iTunes or at other retail outlets for a short period of time, in hopes of capturing sales to consumers who must have a song and are willing to pay a premium for it. Thirty days later, songs would be available on streaming platforms like Spotify and Rhapsody.

Depending on which pane you look through, one might argue that windowing for streaming services is limiting promotional exposure that might benefit artists. As radio airplay has been shown to be historically important to music discovery and promotion, so streaming plays may be helpful for music artists in this digital age in creating a musical window shopping sort of experience online. However, not all music industry affiliates view these services as windows of opportunity.

Artists concerned with lost sales already have taken stances to window or prevent their music from being available to some services. Coldplay, for example, delayed the release of the band’s most recent album to Spotify to encourage up-front sales. Notably still absent from Spotify is Adele’s Diamond status 21 album, an absence which resulted from Adele’s requirement that her music not be available to free users and Spotify refusing to change its model to accommodate that request. She agreed to allow it on Rhapsody since it was a paid only subscription model. Paul McCartney recently drew the drapes on the streaming services by removing his catalog from the platforms, which falls in line with the opt out from The Beatles’ label that has existed for awhile. So are these artists helping or hurting their cause with such limitations?

Rhapsody CEO Jon Irwin frames an interesting argument regarding streaming services and the cannibalization of music sales: “Rhapsody, and services like Rhapsody – premium, on-demand, subscription music services that focus on building a paying subscriber base – they don't cannibalize CD sales, they cannibalize piracy.” This suggests that the heart of the matter really is what drives consumers to buy music versus steal it. Does adding a window of time before they can stream a song really drive people to buy it more? What about if they can never stream it? Will the modern consumer really go back to iTunes or Amazon or even the CD store or will they resort to other borrowed or stolen listening measures or even worse, decide to toss that song or artist out the window entirely and listen to others instead? Does an open window cause new or more consumers to fly in or is it a waste of energy?

Before jumping to conclusions about whether windowing or other limitations are helpful in keeping sales figures intact, the industry should really pause a moment to model it and put the idea in front of consumers for their feedback and understanding. Find a way to help the consumer understand it in a way that makes them think, ‘Yes, this makes sense for the artist and for the general good of music and is worth it to me.’ The haphazard authoritative battles taking place right now among artists, labels and streaming services threaten to detach the consumer and/or give them a sense of being duped or gamed. Creating a window that just gets fogged up in consumers’ minds is counterproductive. Creating a clear view for consumers based on a glimpse into their way of thinking is critical.

Those who walk out their office door and talk to consumers to understand what drives purchase behavior and how they interpret streaming in the mix of fairness to artists will come out ahead over those who just predict the consumer forecast by looking out the window. Don’t let your consumers walk in the door just to fly out the window.

Share |