Playing different tunesGenerally speaking, the traditional players in the music industry have not kept pace with the shift in technology. New innovative entrants, such as iTunes, have filled the vacuum and redefined the industry, leaving the legacy players fighting for their very existence. The legacy players have literally found themselves being new entrants into their own market. New business models are being hastily introduced, with varying degrees of success. The relatively strong are buying the weak. We are seeing a whole series of poorly considered “knee jerk” reactions and bankruptcies. The music industry is currently at a cross roads … only the strong will survive, and the strong may well be the new market entrants.
The reality is that the music industry has always been subject to shift, typically introduced by new formats. Some landmarks along the way … the introduction of piano rolls (1896), 78 RPM records (1906), 33 1/3 RPM records (1928), the LP (1948), the 7” single (1951), the cassette (1964), the 8-track (1966), the compact disc (1978), MTV (1981), the MP3 (1990), streaming (1995), Napster (1999), Pandora (2000), iTunes (2003), YouTube (2005), and Spotify (2008). If some of these dates sound earlier than you expected, well, let that be a lesson to you. These formats did not storm the industry and decimate it overnight.
The big shift occurred with the introduction of MP3 … and from thereon out it was downhill. We are literally talking an industry that, at the face of it, is used to format changes … and should have been far more agile given its history. The writing was on the wall and the industry failed to respond.
History is littered with stories of companies that fell by the wayside overnight as a consequence of the emergence of a new technology.
Who remembers the slide rule? For those young enough not to know what I am talking about, the slide rule was a ruler of sorts with a shifting bar in the centre that was used for doing math. The slide rule became extinct overnight as a consequence of the introduction of the pocket calculator. Here today, gone tomorrow!
Another classic example of a product that did not survive a shift in technology is the telex. The telex was replaced virtually overnight by the fax machine. The fax machine itself is now bordering on extinction, thanks to the introduction of the email. Again, for the youngsters, the telex network was a switched network of “teleprinters” similar to a telephone network, for the purposes of sending text-based messages. The telex had a speed of approximately 66 words per minute.
Its happening right nowSatellite and Cable TV coupled with the introduction of PVR recorders have pretty much sounded the death knell for the corner video store. The cinema industry is likewise seeing a falling off.
The future of the printed book is also in the balance. Sales of eBooks are on the up … and their printed counterpart is on the way down. Many periodicals have ceased doing a print version … and are now only available in the electronic format.
What do we learn?The long and short of it … companies that fail to innovate will eventually cease to exist … it’s simply a matter of time. Innovation is not a once off event … it’s a survival prerequisite. Innovation is not a strategy; it’s a way of life.
When the writing is on the wall, you are advised to read it!