Evidence-Based Management

Disruption of the Music Industry

Presented by James Vera Karissa Keller MBA 616 Organizational Behavior & Communication

What is Evidence-Based Management?

An evidence-based decision-making process that should be based on a combination of critical thinking and the best available information.

Best Practice vs. Best Available Evidence

The Internet
Change in Music Distribution Global Sharing of Digital Music Online Loss of Power and Control

Intellectual vs. Physical

Business Models I
The Traditional Business Model The traditional business model in the music industry includes the mass production and distribution of physical goods. This model includes the record labels that manufacture the product and distribute it via bricks-andmortar stores, direct mail clubs, as well as artists selling their CDs at concerts. The traditional model includes the history of the industry from the early 20th century through the present.

Business Models II
The Renegade Business Model The renegade business model is based on illegal, unauthorized P2P music file trading (of digital MP3 files) via the Internet. This activity is enabled by organizations providing software that empowers millions of consumers to become unauthorized mass distributors of music for free.

The Rise of Napster

Brainchild of Shawn Fanning
Tripled number of users in one months time Finally shut down in February 2001 after lawsuit

Majors believed Napster era was dead

Breakdowns
Blatant Management Failures Strategic Mistakes Fear and Loss of Power and Control Non-Creative Sales Ideas

Changes in Consumer Media Preferences

No Universal Strategy for Digital Distribution on the Internet

Out of Touch with Consumer

Interests and Demands

So..What do we do?
Find Innovative Ways in How Music is Used Importance Needs To Be Placed on Public Performance Rather Than Ownership Support the Internet Fairness Act Support Online Music Streaming Models

Business Models III

The New Business Model The new business model includes legitimate online digital music services. Legitimate online music services are part of the native Internet business model category of digital products and digital delivery that often have strategic alliances with access providers.

Spotify
Creates a new market Napsters legal alternative 6 million paying customers and 24 million active users But it is it evil?

Last year, streaming and subscription services generated $1.03 billion in revenue, up 59 percent from the year before

Unique Revenue Streams

Radiohead In Rainbows Jill Sobule Crowdfunding

David Byrne & Brian Eno Various forms

Conclusion

Is The Internet
The Demise of The Music Industry?

Evidence-Based Management
Disruption of the Music Industry
Presented by James Vera Karissa Keller MBA 616 Organizational Behavior & Communication