Just Another Industry: The End of the Scarcity Model in Music

The following table examines the components of the music business that made it “perfect” for Internet-based disruption, and the state of those components afterward.

Business Component	Pre-Disruption (Perfect Industry)	Post-Disruption (No Longer Special)
Promotion	Magazines pushing Record Companies’ product: Free	Most music magazines have become culture based. Do not have nearly the same pull over readers. People do not need recommendations. They can sample and judge for themselves.
Promotion	Radio pushing Record Companies’ product: Free	Still relevant, but does not have nearly the same pull over listeners as before. Decentralized by emergence of Internet Radio.
Promotion	Television: MTV: Free Advertising	Now industry must pay for television advertising, like all other industries.
Promotion/ Distribution	Physical Distribution. Chains of independent retailers whose focus was selling Record Companies’ product.	Now only physical distribution is big box stores (Target, Walmart, etc.) or Mom & Pop indies. Physical is waning anyway. Digital distribution is not monopolized.
Distribution	Controlled by Record Companies: Oligopoly.	Distribution now flat. Internet is an equal space, any random musician can have worldwide digital distribution without Record Companies.
Listening Technology	Records followed by CDs. High Priced. Cheap to produce. Not copyable. Wears out (must be replaced).	Digital copies cost nothing or are cheap. They are easily copied. They do not wear out. Unlimited consumption streaming services like Spotify are emerging.
Costs of Production	Used to take enormous sums of money to make a commercially viable album.	Now solid albums can be created cheaply with virtual instruments and home studios.
Popularity Principle: Reinforcing	Just had to get Album into Top 40 charts to create more sales: Consumer rationale “Must be good because it is selling!”	World of niches. People can sample for free, will only buy what they personally like.
Cool Factor	Music defines people over long periods of time.	Still relevant.