The future is golden, and it looks nothing like today. But the path is bumpy, so gear-up.
That’s the picture illustrated by British music and media analyst Mark Mulligan, who presented a thought-provoking keynote at the first annual Music Tectonics Conference in Los Angeles, stuffed with trendspotting, analysis and prediction.
Mulligan, managing director at MIDiA Research, delivered a wide, but admittedly not “deep”, take on the future of the music industry by drawing on the past and looking east, where platforms such as TikTok and Tencent have expertly monetised fandom.
“The Chinese music industry is essentially being invented from scratch. Because of the oxymoronically titled cultural revolution you didn’t have popular culture, in China,” he said. “It’s only over the last couple of decades or so, they’ve started to create it from scratch.”
“Now if we were starting the western music business today, there’s no way we would have put social at the centre of it. And that’s what the Chinese music industry has been able to do. Social is everything about how people express who they are.”
Also, masters are king, Mulligan pointed out. Publishers currently earn roughly 15% of revenue from streaming services. Labels get 50% or more. Going forward, publishers are shifting their rights ownership now that it’s obvious that royalties for masters will continue to get a bigger piece of the streaming pie.
Mulligan talked consumption patterns, radio’s existential crisis thanks to podcasting, and the constant industry shift. Self-empowered artists, many of whom are independent, will continue to move the goalposts. “An artist needs to be able to bend the rules that exist,” he explained.
The attention economy has peaked. We’ve reached the end of the mainstream era where the a-league stars create cultural, shareable moments, and streaming will inevitably plateau, a truth we’re already seeing today in trade data, Mulligan explained.
“A recession is coming,” he warned. “Think about what happens in a recession. Discretionary spending. Subscriptions are likely to be hit really hard. Live will be probably be hit hard too. Start planning.”
The podcast of Mulligan’s Music Tectonics speech dropped today and can be streamed here.