“there is no way that this development in how people listen to music can or will be reversed”

Dancing to a new tune

The irreversible future of music


Text by Andrew Howitt

For more than a decade, it looked like pirates might sink the music industry. After annual physical album sales peaked in 1999 at $25.2 billion globally, the rampant spread of online piracy nearly halved the industry’s revenue, bringing it down to $14.3 billion in 2014. What stopped the downward spiral, transformed how music is consumed, and put the future of music on a new track is streaming, a more reliable, more convenient and safer alternative to piracy.

“The rise of these streaming services has completely changed the market for recorded music,” says Andreas Brandis, managing director at German jazz record label ACT Music. “From our perspective, two things are certain. First, people will always want to listen to recorded music. In fact, they are listening to more music than ever before. And, second, there is no way that this development in how people listen to music can or will be reversed.”

According to the International Federation of the Phonographic Industry’s Global Music Report 2019 released earlier this month, recorded music revenues grew for the fourth consecutive year, to reach $19.1 billion in 2018. Streaming now accounts for 46.9% of global recorded music revenues — with overall streaming revenues up 34% in 2018 — compared with physical sales comprising only 25%.

The German label ECM resisted streaming until November 2017, but now has its catalogue of some 1,500 albums on all major streaming sites.

“It was important to make the catalogue accessible within a framework where copyrights are respected,” says Christian Stolberg, head of communications at ECM. “Although ECM’s preferred mediums remain the CD and the LP, the first priority is that the music should be heard.”

Like ECM, Japan has not rushed to embrace streaming. Although the nation was the world’s second-largest music market in 2018 after the US — with the UK, Germany and France rounding out the top five — the Recording Industry Association of Japan reports that CD sales accounted for 80% of the country’s music revenues in 2017. However, it seems that, even here, listening habits are beginning to slide towards digital and streaming formats.

This trend has not been entirely positive for music labels, and especially independent ones.

“The income we receive from streams does not compensate, in any comparable way, for the loss from physical sales — neither for the artists nor for the labels,” says ACT’s Brandis.  “This makes it harder to produce new music. We can’t only embrace streaming; we need to establish new approaches to broaden our business model.”

That said, the nature of streaming and the possibilities it creates give an indication of how music consumption, and music itself, will evolve in the coming years. Perhaps the most significant change is that music is becoming increasingly global. Markets, such as Asia and Latin America, are opening up as anyone with an internet connection can become a new listener; and musicians are being exposed to a broader range of types of music, leading to new kinds of musical expression.

“All music is available pretty much everywhere in the world; we can potentially reach a huge audience, way beyond the jazz world, through these services,” says Brandis. “Like in many fields, borders are becoming obsolete between countries, cultures and continents, but also between genres and styles.”

At the end of last year, the Nordic chambers of commerce in Japan held an event called The Future of Music Consumption at the Embassy of Sweden in Japan. One of the speakers was Henrik Johansson, head of Japan’s Premium Business at Swedish streaming giant Spotify, which boasts 207 million active users — of whom 96 million are paid subscribers — across 79 markets.

“What we do and the product we build have quite an impact on how people listen to music, enjoy music, think about music and discover music,” he stated.

According to Johansson, it’s certain that there will be greater personalisation for listeners, through improved algorithms and careful editorial curation.

“We learn a lot about what people value in terms of what music is, and when they listen,” he said. “And we can feed all this information back into creating a platform that’s even more personal, that’s even better at helping you discover new content and new music. We’re moving away from a world where radio shows and big marketing machines determine exactly who is going to be successful.”

Johansson also observed that streaming is removing the limitations that physical formats had imposed on musicians. The news site Quartz reports that the average song is getting shorter, due in part to the economics of streaming — where “more streams means more money” — but Johansson asserts that creativity is boundless within the context of streaming.

“There’s nothing stopping you from making a 24-hour long album and putting it on Spotify,” he said.

Also, the idea that an album is no longer fixed has begun to take root. Noting that some artists have been making modifications to albums in their back catalogue, Johansson believes that streaming services allow for an entirely new, open-ended form of creativity, with art that can change as the artist matures.

“What’s been printed on the CD is not the way you have to listen to an album for the next 25 years,” stated Johansson.

The future of music is not entirely in the hands of streaming services and musicians. Change is also taking place in how our music is delivered. Smart speakers, for example, will become increasingly integrated into living spaces, and firms are working hard to make the sound quality and listening experience the best they can possibly be. Danish speaker manufacturer Bang & Olufsen, for example, brought its first smart speaker to the Japan market in January.

“Music is something that should be easily accessible, a natural part of our daily routines,” said Shin Iwanaga, president of Bang & Olufsen Japan, speaking at the same event as Johansson. “That experience is what we are continually trying to produce.”

Bang & Olufsen’s recently
released Beosound Edge speaker — a large, metallic disc balancing on its edge — demonstrates the firm’s emphasis on design, craftsmanship and sound quality while nodding to the future direction of speakers in the home.

“The designer behind the Edge is Michael Anastassiades, and he hates speakers that are visible in a room,” said Iwanaga. “His product has actually exceeded the boundaries of a speaker — it is an art piece, a sculpture.”

Free of twentieth-century constraints, music has entered a phase of seemingly limitless potential. Today’s technology will ensure that we never tire of listening to the new directions that musicians take. 

“We’re moving away from a world where radio shows and big marketing machines determine exactly who is going to be successful”