• The Music Industry Bands Together to Finally Get Paid Online

    September 10, 2017
    • The Music Industry Bands Together to Finally Get Paid Online

    LAST FALL, A group of music industry heavyweights gathered in New York City to do something they’d mostly failed to do up to that point: work together. Representatives from major labels like Universal, Sony, and Warner sat next to technologists from companies like Spotify, YouTube, and Ideo and discussed the collective issues threatening their industry.

    And there were many. For decades, major labels have watched record sales nose dive. Meanwhile, streaming services are growing in popularity but drowning in lawsuits. In 1998, the industry reported revenue of $13.8 billion; in 2016 it had dipped to $7.65 billion—and that was considered a good year. “It’s a really fragmented industry,” says Dan Harple, founder of Context Labs and one of the organizers of the meeting. The participants of that confab would later form a group called the Open Music Initiative.

    The OMI got started in the winter of 2015, when Harple began working with Berklee's vice president of innovation and strategy, Panos A. Panay, Michael Hendrix of the design consultancy Ideo, and a handful of others at the school's Institute For Creative Entrepreneurship to establish a working group with sole purpose of figuring out how to ensure the music industry has a more sustainable future. Over the years, Harple's witnessed the power of technology change industries for the better; he’s also seen it wreak havoc on those that aren’t prepared.

    The music industry, he says, falls squarely into the latter category. After decades of building distribution channels around record contracts and sales, the micro-transactional nature of the internet has, in some ways, diluted the industry. “I like to make a joke that it’s akin to a FedEx guy who shows up and gets 80 percent of your product price," Harple says. "To me, that’s in some ways what the App Store does and iTunes does and streaming services do.”

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