Reshaping The Music Distribution Model: An Itunes Opportunity

Abstract

Many experts believe that subscription services are the last great hope for the music recording industry; however, the underwhelming success of existing subscription services have deterred music rights holders from embracing the subscription model. While many understand why the subscription model should be implemented, few understand how it could be introduced. This study sought to create a conceptual framework to demonstrate how an on-demand subscription-based streaming service could be successfully implemented, in music, by studying a successful subscription model, Netflix, which operates in a parallel industry. By examining Netflix, and analyzing the differences and similarities between the video and music industries, this study created a conceptual framework which demonstrates how to successfully implement a similar service model in music, with the opportunity to create significant value.

Key Words:

• innovation
• music industry
• video industry
• distribution models
• corporate strategy