[opendtv] News: Music industry to replicate Hollywood's content release "windows"

http://broadcastengineering.com/newsletters/scm/20050823/#

As the music industry begins to adapt to digital distribution...


Music industry to replicate Hollywood's content release "windows"  
  Aug 23, 2005 8:00 AM, Strategic Content Management e-newsletter

As it continues to shorten its longstanding system of "windows" for 
access to copyrighted material, the music industry is betting its 
future on just such a model of staggered, tiered releases, CNET News 
reported last week.

Digital download services such as Apple Computer's iTunes have 
gleaned most of the headlines to date. But the digital music market 
has already moved to a diverse model, particularly when mobile 
consumers are counted.

Sony BMG is already seeing 10 percent of its revenue in the United 
States, and more than 20 percent of its revenue in China and South 
Korea, come from digital and mobile products. In the next year, 
labels will increasingly find ways to boost those figures by offering 
a large range of different products at different times, and through 
different channels.

These budding music windows - ranging from exclusive tracks posted on 
iTunes or pre-release ring tones to live CDs released long after an 
album's street date - are signs of how seriously the music industry 
is taking the digital business at last, CNET said.

Physical CD sales continue to drop, and executives say they don't 
realistically expect that to turn around or even to stabilize 
immediately. Peer-to-peer use continues to rise worldwide, and 
according to research firm NPD Group, 44 percent of music found on 
consumers' hard drives in 2004 still came from file swapping or 
copying other CDs.

Digital sales continue to grow by leaps and bounds, however. 
According to the International Federation of the Phonographic 
Industry, about 180 million songs were sold online in the first half 
of 2005, up from 57 million in the same period last year.

Releasing content in tightly controlled windows - first in theaters, 
later to home video, and finally to TV, for example - has been hugely 
profitable for movie studios in the past few years. These windows 
have shrunk substantially as DVD releases have been moved 
substantially closer, but the studios have kept strictly separate 
release dates for theaters, home video and on-demand services, the 
CNET report said.

This new product model is also changing the role of record companies, 
which are increasingly dealing with other giant corporations, from 
telephone companies to Internet portals, as music distributors.
 
 
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