Open Access

Adelina Kostova

• The goal of this thesis is to provide information on how the music distribution has evolved throughout the years since the internet and computers have brought a new digital ear to the music industry. This gave unlimited access to vast amount of information, creating new methods of communication and connecting to thousands of music lovers with only one mouse click. Technological and social changes have followed ever since the beginning of the 20th century with significant impact on different business aspects like Marketing, Communication and Pricing. In the following years illegal downloading has brought the music industry to a crash with sales dropping almost double in only one year. This, however, led to the idea of legal downloading and later in 2008 to the birth of the most used music streaming service Spotify. The bundle paying method of this new service has not only put the industry back on its feet but it has also brought the interest in the consumers back. A monthly “flat rate” in exchange of a vast music catalogue of more than 30,000 songs, albums and artists with the ability to listen to it offline turned out to be the better alternative. The purpose of this paper is to conduct an explorative research on the current situation of the music business and the business models of the new trend “music streaming” by using different analytical methods. The research results show a significant change in the way Marketing and Communication are being done by labels, brands and the streaming services due to the rapid technological progress and the new social habits born with it. Using the experience of listening to music, data and audience intelligence provided by the services, brands are now able to communicate their exact message in front of the right person and in the right time. Pricing of music has also gone through a big transition since music streaming has become the preferred way of listening to and exploring new music. The effect of the bundles provides users with unlimited usage of the music streaming service and its catalogue in exchange of a monthly fee also called “flat rate”. Each service decides on the price and the subscription method to be offered. To give a more comprehensive picture on what the future of music streaming is, this paper is using not only secondary data but primary data as well. In order to generate free discussion, the study refers to the media and an expert to give answer on what are the signs pointing the direction the music business is headed towards.