How has Iron Man Records adapted to the growth of digitalisation?
Iron Man Records has had little choice, it has had to learn to adapt to digitalisation regardless. From 2004 until 2014 the label has seen a steady decline in physical sales both online and through physical outlets. From 2014 until 2017 this has continued at a faster rate and from 2017 to 2018 there has been a sharp drop, the decline has got much worse and deteriorated rapidly. This decline, which has accelerated in recent times, has effected not just Iron Man Records products, but all physical products the label makes available for sale. The physical distributors who take stock from Iron Man Records and distribute across the UK, Europe and North America take fewer and fewer copies with each order.
It might be suggested that people haven’t got the money to spend that they used to. It might be the case that individual music consumption habits have changed. It may be that people are more choosey about what they spend their money on, and how they engage the artists they like. To me at least, the physical format is in decline and aside from niche markets, will probably continue to decline. There doesn’t appear any choice, adapt to digitalisation or be consumed by it.
The record label has adapted to digitalisation in a number of ways, and this has been encouraged by the collapse of almost all physical sales with the exception of selling stuff at Gigs. Looking around it appears to me that most people listen to music on mobile devices or through their computer. Habits have changed and many people are listening to more music, and more artists than at any time previously. This has got to be a good thing and there are a number of things worth mentioning.
Income from live music industry activity appears to be increasing for the bands that continue to play live regularly. I would suggest this has been driven in some sense by individuals who know how to get their music for free, perhaps by sharing platforms, social media, streaming or downloading, and they are happy to spend money on tickets and going to see the bands they like playing live.
The Music publishing industry has changed a lot, and collecting statistics has been made easier via digital portals. I don’t have much first hand knowledge in this area so I’ll leave my comments at that. Someone else can talk about music Publishing.
The Recorded Music industry has changed dramatically. I think the most notable change has been from “ownership” of music in both physical and digital formats, to “access” to music. See the growth of Streaming.
YouTube and social media provide access to music in many forms. The “music content” seems to be generating advertising revenues for digital platforms faster than royalties for the artists who produced the music in the first place. So, while I think Youtube and others provide a great opportunity, I haven’t pursued them with much emphasis for that reason. Platforms like Amazon are making use of their subscriber base e.g. Amazon Prime, to make music an “added value” part of the subscription, benefitting the consumer, rather than the artists themselves.
I expect in time, the music industry, if there’s anyone left standing to pick up the cause, will lobby to see that where music content is provided for free, or provided to subscribers in an unlimited fashion, a greater paid subscription to the service will be required so that better royalties may be passed back to artists. But to me, that still looks like a long long way away, and Artists are always the last to be paid.
The significant digital platforms where individuals engage the releases from the label include: iTunes, Spotify, Amazon, Google Play, Apple Music, Emusic, Groove, 7Digital, Napster, Medianet, Deezer and Youtube. Whilst including platforms that offer downloads, an increasing proportion of engagement is via streaming platforms like Spotify, Amazon, Google and Apple Music.
Individual consumers appear to be less interested in owning a physical vinyl record, or CD, or DVD. Individuals are becoming less interested in ownership of digital files like WAV or MP3. To me at least, “access” to music is becoming more widespread as the default mode of music discovery. Where anyone is looking to buy a physical product, it will most likely be by their favourite artists or will be a favourite album which they may already have in a digital form on a mobile device, or on their computer. The physical purchase may be seen as something of a souvenir, or a like a piece of artwork, to add to their collection, rather than a physical necessity for listening purposes.
Iron Man Records continues to aggregate all releases across as many platforms as possible, its clear that streaming and “access” platforms are generating the greatest engagement. Sales of downloads are almost insignificant by comparison, and physical sales have almost been consigned to the bargain bin of history. However, physical sales are still happening to a resonable degree, offline, at live performances and online Bandcamp continues to surprise my skepticism. Bandcamp appears to demonstrate a healthy degree of engagement generating increasing streaming statistics and both physical and digital sales. Bandcamp is also an independent. At the moment, Bandcamp is probably my favoured digital platform. It appears to be good for the consumer, good for the artist, and it’s actively displays an appetite for writing about and reviewing new material on it’s homepage. It’s also easy to use.
The overall music economy however, not just around Iron Man Records, appears to be at best changing, and at worst declining. Between 2000 and 2010 Iron Man Records aggregated all available releases through whatever digital platforms were accessible. The total cost of aggregation outstripped any income derived from such activity. Indeed, a number of digital aggregators that the label made use of, not only proved costly, but they also went bust during the process. This might be an indication that at the Iron Man Records end of the spectrum, with a small niche for a customer base, income streams, available technology and ability to sustain the process were unbalanced and in the long term unsustainable during that particular time.
Since 2010 Iron Man Records has continued to aggregate all releases digitally, across most platforms, and has started to recover initial costs in some cases. The label is still losing more money each month than it is earning, but the losses generated through digital distribution are getting smaller. At some point, some of the releases may generate sufficient funds so that both the bands and the label may derive a small benefit. However, the growth of digital revenues is dwarfed by the decline in physical revenues. So whilst I feel optimistic that digital opportunities are developing and growing. The total worth of the music economy around the record label continues at present to decline.
That said, anyone in my situation, where the record label is losing money year on year, would probably just pack up and leave the field. How can you sustain a record label if physical sales are collapsing, everything is being funded from your own pocket and digital revenues are still insignificant by comparison? There had to be a way to adapt a digital platform to sustain physical income. I found a potential solution in Patreon, it works like a cross between a crowd fund and a pay wall. Patrons sign up and pledge to give the record label a small fixed amount each month in exchange for a number of rewards. These rewards include access to private streaming from a soundcloud account, copies of any digital release on the label, and early access to news and updates form the label. Rewards can also include T-shirts, Vinyl, tickets, stickers, and even a “send to a friend” service. There are a number of other benefits too. But the point is this: In exchange for a fixed fee each month, Patrons get their name on future releases and get access to pretty much everything else on the label by request, for free. So far I have attracted 35 Patrons and their support each month is helping to fund, in part, specific projects. These projects are record releases on Vinyl. While the music economy around Iron Man Records continues to collapse, Patreon has helped generate small amounts of funding at a critical time. It has certainly allowed the label to think about releasing records again, and it has made Vinyl a possible format too. If you would like to support Iron Man Records and see where this might go, you know what to do.