I have a lot of ideas for businesses and/or products that I think would be successful and would love to use. As I lack the necessary resources (time and capital) to create them now, I am satisfied merely posting them here for others to view.
Kickstarter for music
In a future where everyone has a music streaming subscription service, why would anyone buy an album?
Many Bands are no longer making sufficient amounts of money from album sales. This is only going to go down in the future. While piracy used to be the dominant problem, now, album sales are being replaced by streaming subscriptions, which are only becoming more popular. While this is legal, artists are compensated far less than they are used to. Without sufficient compensation for the creation of albums, many bands will simply stop producing albums (or make less of them). In this scenario, both the musicians and fans lose out.
The purpose of intellectual property is not to compensate someone for their work, but to incentivize them to create new work. In light of the changes in the music industry, I would like to see a model where artists are incentivized to create as much or more music than currently exists today.
My proposed model is to use crowdsourcing to finance new albums.
Bands would list the albums they could potentially release (ie their next album, a live album, b sides etc) on a website where once the band has reached their asking price, they will start working on the release of the album. The price listed is not how much the album costs the band to make, but the amount of money that it would take the band to feel sufficiently incentivized to release the album. Once the album reaches this point, the band would release the album for free online.
This system will not make the artists as much as they made in the past, but merely more than they will otherwise be making once subscription services become ubiquitous and nobody has any incentive to pay for an album.
Under such a system, because the artists will not be releasing the album until it reaches a sufficient level of financing, fans will have incentive to support the album or risk the proposition of it being released much later, or potentially, not at all.
Artists would continue to get the support/sales from those who already pay for music/stream music, but this model creates two new streams of revenue.
- People who value the album a lot more could pay proportionally. Under the current system, if someone really likes an artist, they are still only going to be paying them a few dollars for streaming their album through Spotify, or at the very best, buy their album for $15. If Drake’s new album has a $100 value to someone (either because they have lots of money or they just really love Drake), they should be able to pay however much the album is worth to them. With the possibility that the band might not produce the new album, or that it will come out much later, fans who value the music a lot will be incentivized to contribute to the artist however much they value the album.
- Cheap fans. Despite being devoted fans, many people don’t support their favourite musicians. Under the current system, many fans just wait for their favourite band’s album to be released and either download or stream it. This occurs because there is no incentive for these cheap fans to support the artist. They will receive the same album at the same time whether they pay for it or not. With my proposed model, fans who currently do not pay artists would be more willing to contribute because their money actually makes a difference in the timing/creation of the album in question. By contributing to the album, the album has a greater likelihood of being created/comng out earlier. Therefore, these fans actually benefit by paying the artist. Under the current system, there is no benefit for these fans to support the artists. When fans have an incentive to support an artist, they are more likely to do so.
My proposed business is a centralized website similar to Kickstarter that does the financing for new albums. The business would receive 3% of all album revenue. For this to work, this business would need to be THE spot where albums are listed to capitalize on the active audience/built in advertising. The company would also provide actuarial services to project how much each album is “worth”, and how long it would take to acquire the necessary financing. Lastly, the company would also have a team of marketers to help promote the project to the band’s audience and the internet as a whole.
Prediction Market/Fantasy Game For Musical Discovery
A record label or an online music store/subscription service should create an online fantasy market for bands/artists. Each artist/band will be given a price, that users can “buy”/invest in based on how many users follow them/listen to their music. Depending on how many plays/follows the artists get in the coming weeks, the cost of the artist/band increases. The goal is for users to earn the greatest return possible by investing in the most promising bands.
This program would serve two purposes:
- it would enjoyable for users of that service to play this game. It would aid users in musical discovery and get them more involved in music period. Additionally, it will make these suers more reliant on that specific service (IE foster brand loyalty to Spotify) and be a fun game for one to be immersed in.
- The crowdsourced data of who users think is going to become successful could be used akin to a prediction market, to provide important data in helping record labels select which musicians to invest in. There is great uncertainty in which musicians will continue to grow their fanbase, and “how hot” they will become. The crowdsourced aggregate found in this data would provide very important and informative knowledge on who is likely to succeed that might be missed by other metrics.