Bright Future for Digital

Hosted by
This is Celia Hirschman with On the Beat for KCRW.

The evidence is mounting. The future of the music business is the mobile music business. All signs are pointing to digital delivery systems that are portable, interactive and flexible. Though just about everyone in the label business is still singing the blues, executives in the digital space are smiling like Cheshire cats, staring at their newly caught prey.

While attending the opening day of the 6th Annual Digital Music Forum in New York City, it quickly becomes apparent that the music industry's newest partner, the telecommunications business, has the magnitude and force to dominate the conversation. The power of the mobile telecommunications companies to command national attention instantaneously, gives MTV, Rolling Stone magazine, Tower Records and every other traditional marketing vehicle to real run for their money. Think about it. Would you rather spend thousands of dollars advertising on VH1 or in Rolling Stone, or would you prefer to text message a million people about your band's latest album and special download?

Once the hardware devices become user friendly, it's easy to imagine how telecoms will become the next voice you hear in record marketing.

And record labels understand why this is beneficial. In fact, Major labels have begun releasing ring tones, particularly in the hip hop and rap genres, months ahead of their albums' release, to help stimulate the buzz early.

The telecoms are beginning to show king kong force in their marketing. Verizon recently launched their Vcast service, which bring music, video and television directly to consumers' cell phones. During Grammy week this year, Verizon blocked off the corner of Hollywood & Vine to stage a reunion of the hip hop group The Fugees, sponsored by Vcast. The announced the promotion by text messaging Verizon customers in LA, invited them to get tickets.

The Fugees, a band with great credibility in the hip-hop world, performed to thousands, and the entire event was also available live to those with Verizon cell phones. Now that's marketing muscle.

The record business has traditionally been wary of partnering with others, particularly when the others earn sizeable income on the label's music. Last year, when the Apple giant Steven Jobs accused record labels of being greedy, he wasn't looking in his own backyard. With Apple earning 29¢ on each track downloaded, and with over 1 billion tracks sold to date, you can just imagine how righteous his claim is now.

Apple has not been able to dominate the cell phone market, with complaints of the iPod phone design holding back mass consumer acceptance. Once the right design hits home with consumers, watch out. Apple has the potential to dominate the market, with so many iPods in use.

But regardless of the manufacturer, or the telecom involved, one thing is abundantly clear. To everyone in the digital music business, the future looks very bright.

This is Celia Hirschman with On the Beat for KCRW.