About 90% in thirty-three years. That’s what best-selling album record sales have fallen from Michael Jackson’s Thriller (65 million -physical- copies sold in 1984) to Ed Sheeran’s ÷ (6.1 -physical and digital- million copies sold in 2017).
Another way to understand the situation: total record industry revenues had their peak eighteen years ago, now the industry celebrates reaching 68.4% of revenue in 1999.
On the other hand, streaming revenues have grown by more than 41.1% last year. This gives us an idea of the magnitude and increasing change that emergence of new forms of music consumption has brought about.
The industry is changing at the same pace as we jump from one album to another, and one of its reasons is music recommendation. Recommendation systems evolve towards automation for two reasons: accessing large catalogues - which allows a more precise curation - and because this access is shared by the public, who refine and change their tastes more quickly.
Moreover, the value gap (mismatch between consumption and revenue returned to artists) and the decline in record sales has resulted in a boost for the live music. More than 30 million people attended concerts and music festivals in 2016 in the UK, while 32 million people attended only music festivals (excluding concerts) last year.
But streaming is not the only significant change for the music industry through the last years: social media have also become the other field where record and live music companies had to invest time and effort.
Instagram and Twitter have become the battleground for most of A&R professionals, where they account the growth of their social profiles as one of the most important achievements. The analysis of social media is now a central task for the key actors in the industry: data may make them understand how fans are reacting to music and delve into their consumption habits.
This disruption has been received very smoothly by consumers and their music consumption habits are mostly based on the digitisation of content. Nevertheless a large part of the players in the music industry still dedicate a strong effort and wit to adapt to this new environment.
This project was born from the need to not just understand, but to satisfy in a fast and effective way the needs of an industry that has only diversified and evolved since the start of the digital age in music
FuturePulse is formed by a heterogeneous consortium, comprising technology companies, research institutions and music industry stakeholders, working together in offering sophisticated analytics and predictive modelling services.
FuturePulse wants to offer a sophisticated predictive modelling and analysis service that can get the industry to answer questions like “Where would be the best location to organize a Balkan music festival in the next months in Europe?” or “Will the artist who recently signed with the label be successful among Germans between the ages of 20 and 35?”. Also, one of the project’s key goals is providing music platforms with tool to construct playlists that are suitable for specific business areas in an automated way.
At BMAT, we exist between two worlds, music and technology. Ever since we were born 12 years ago, we’ve seen this industry developing great systems to understand its own functioning. More and more users generate massive amounts of data that, if well understood, will enrich the decision making of all the agents, better the user experience and let artists get closer to their audiences. This means, we’re walking towards specialisation and it implies, at the end of the day, a growth in efficiency, the efficiency that we find in data processing, and that leads us on to better Business Intelligence.
One of the main reasons why we decided to coordinate this project was because of a double incentive: to evaluate the specialization in the industry and at the same time provide efficient tools to support this. During the process we have observed the growing number of similar approaches in the market, which reaffirms that our intention was right and that we are working in the proper direction.
Quimi Luzón, Innovation, BMAT