Assignment Two - Studying the Media and Communication

MED4101 – Studying the Media and Communication

Research Report

How have the changes in digital technology impacted on the Hip-Hop music industry?

For this research report I will be exploring into the music industries. To ensure a specific study I decided to consider the Hip-Hop industry and how digital technology have changed their ways of monetization and ownership. To answer the question, I will be exploring into the Hip-Hop industry and analysing their ownership structure. I will also be analysing the artists, and how their views have changed due to digital practises.

The theoretical framework I will be using is political economy. According to Friedrich Engels, “Political economy, in the widest sense, is the science of the laws governing the production and exchange of material means of subsistence in human society. Political economy is therefore essentially a historical science. It deals with material which is historical, that is, constantly changing.” This was a definition articulated in 1877 by Friedrich Engels, who was a German philosopher, social scientist, and business man. He also founded Marxist theory together with Karl Marx.

Political economy is a term used for studying the production and trade of any industry, it consists of taking an in-depth exploration into how things are run and who they are owned by. The two broad questions involved in this paper are:

• Who owns the music industries?

• How is music controlled and monetized?

These questions were easy to answer before the rise of digital practises, but the major shifts have changed everything, making the question harder to answer.

The methodology I am using is ‘Industry Study’. I chose this because of my passion for the music scene and my involvement. I also chose this because I am interested in the questions I have asked and want to find an answer.

To get the answers, I will be using books, online books, personal knowledge, and a brief interview with a mainstream artist. The question that will be asked is how they have adjusted to the changes within the music industry. This will provide information for both me and the readers allowing for a non-biased study.

History of Releasing Music

Music began being monetized in the late 1800’s, due to Thomas Edison’s phonograph, a device that could record and reproduce sounds, this along with Berliner’s gramophone discs allowed the music industries to grow. By 1910, a mass market for recorded music was growing, Victor talking machine company sold 94,557 machines. This made their revenue reach numbers of $33 million by 1919.

Things began to change in the 1950’s as talking machines were becoming a thing of the past, this digital breakthrough of vinyl discs and other playing machines meant that companies like Victor had to adapt to financially succeed. This meant that their previous machines would be sold allowing for independents to have a breakthrough. In 1979, there was an 11 percent decrease in sales, which was due to piracy. It is noted via a CBS study that $700-$800 million was lost to piracy over the next ten years.

During the late 1900’s and early 2000’s, the internet was beginning to grow and it was becoming available to everyone, this meant that people were finding ways to stream music for free. This caused a major loss for the main companies in the music industries, these being; Universal, Sony, Warner, and EMI. It left the companies in a positon where they had to re-think everything and possibly change the way they release music. This was also down to the fact that CD’s were also becoming a thing of the past and online streaming was gaining a popular audience. This left them in a position where their main source of money has disintegrated again.

Main Changes in Releasing Music

By 2008 the music industry had changed to meet the consumer's demands of cheap, instant, and free music. The music industry had found ways in which they can monetize their releases adjusting to the digital changes. This was completed through satellite radio, ringtones and iTunes.

There are many platforms behind the monetization of recorded music. These are:

• CD's

• Bandcamp

• CDBaby

• ITunes

• Google Play

• Amazon

Apart from a CD, the other platforms are all digital, highlighting the change from then and now. CD's can either be self-distributed or sold through retail, this would mostly depend on whether the artist is singed to a record label, as they will provide the connections and the money to get the disc on the shelves.

If an artist is singed, it restricts their revenue by a huge amount. When an album is release through a label via CD or iTunes, the label will take roughly 47% of the revenue, the distributor/retailor will take roughly 30%, leaving the artist with roughly 23%. If the album was selling for $12, the artist will receive $2.76 for each one sold.

On the other hand, if the artist is independent they still have access to all the distributing platforms which could be a reason why artists are no longer in desperate need of recording contract. If the artist releases the music themselves, they will receive roughly 60% revenue from each platform. Where as if they sell CD’s, they will be receiving 100% revenue.

How Artists have Reacted

Streaming music for free has caused problems for the music industry but has also provided some benefits. I wanted to get an idea of this through an artist's point of view. The artist I chose is Taylor Swift, this is because she is one of the only artists who has begun publicly pointing out the potential drawbacks of music streaming. Her opinion is "music should not be free, and my prediction is that individual artist's and their labels will someday decide what an album's price point is" " I hope they don't underestimate themselves or undervalue their art"

In reaction to this, Taylor Swift pulled her music off the popular streaming sites Spotify and Apple Music. The benefits of free streaming are more present for artists who are less known as it offers them more publicity, which could build them a following. Van Buren, a music producer and DJ states 'that free streaming doesn't mean artists don’t get paid. It's just their pay comes from advertising rather than more traditional sources.’

Through the years of 2008 – 2012, piracy and copyright were big problems for the music industry as it was decreasing their sales. This began to change when streaming companies moved towards paid subscriptions. It allowed companies such as Spotify to restrict the amount of free music being released to the public. This was to ensure that Spotify made more money and so the artists could also benefit.

An example of artists who have made the most of the changes in the music industry are The Beatles. They recently released 13 albums which can be streamed on all popular streaming sites, if you’re a monthly subscriber meaning they have monetized their releases. This highlights the fact that artists can use the changes as a benefit as The Beatles have monetized releases that were originally vinyl's and CD's meaning they are making even more money of releases created over 20 years ago.

An artist who has taken a different approach is Adele, who released the album 25 and kept it off streaming sites like Apple Music. Instead, Adele took to YouTube, using music videos to release her album. Relying on advertisements to help the lost revenue. This highlights a major shift in music industries and how releases are monetized.

Effects on the Hip-Hop Industry

The Hip-Hop industry formed during the early 1970s primarily by African-American youths, in the South Bronx in New York. One of the first labels to release Hip-Hop music was Sugar Hill Records, who released "Rappers Delight" by The Sugarhill Gang in 1979.

During the 1990s Hip-Hop got its mainstream breakthrough. This was mainly down to the sales of certain Hip-Hop music and their growing audience, this meant that people of all different backgrounds were now listening to Hip-Hop. Rap and Hip-Hop became the talking point for many journalists such as Bill Adler, who noted in a Time article that 'Rap is the rock 'n' roll of the day'. Hip-Hop and Rap did not stop growing and surprisingly used the digital shifts to an advantage in some areas.

The internet was something that helped the Hip-Hop industry and provided more coverage. Examples of this are the websites such as "hotnewhiphop.com" that provide constant information about Hip-Hop releases and artist's, this shows that the consumers amongst the industry are very involved, possibly more than many other genre's. The digital shift in the music industries has also opened doors as many new artists have emerged, due to loads of people having learnt how to produce their own music and release for free on platforms like YouTube and SoundCloud.

YouTube is one of the main platforms that has helped the Hip-Hop industry and the music industries. This platform allowed for artists to post audio or visuals for free which could be showcased around the world. This brought the Hip-Hop industry an even bigger fan-base. To monetize these releases, the artist's or labels could create a membership with YouTube that allows them to put advertisements on the uploaded videos, in return, the artist or label will receive money depending on how many views they get. This was an opportunity for artists to venture into the music industries independently.

Hip-Hop artists adapted well to the digital shift through monetization. Instead of solely getting money from releases, they began releasing music for free. This enabled them to spend more time on tours and sometimes venturing onto creating their own label. Tours along with interviews and advertisements would make up for the lost revenue through monetized releases. Hip-Hop artists of today are well known for their free music, they often release mixtapes and EPs instead of monetized releases. A prime example of this is Future, an American artist. Future, over the past two years has released 5 mixtapes and 2 monetized releases, one of them being a feature album with Drake.

In conclusion, I believe that the changes in digital technology has provided both advantages and disadvantages for the music industry. The Hip-Hop industry is one of the genres that has adapted to these changes well. It enabled for the genre to grow and become one of the most listened too in the world. When Hip-Hop began, there was little coverage and some people did not believe that the genre would get anywhere but whilst the other industries suffered through the changes, the Hip-Hop industry adapted and grew well allowing for them to have a significant share in the market. The main thing that changed within the Hip-Hop industry over the digital technology years is the revenue being brought in. Other industries like Pop and Rock were struggling to make money but Hip-Hop used this as a chance to gain more of a following and to pull in more revenue from other sources.

References

Wikipedia (n.a) Political Economy. Available at: https://en.wikipedia.org/wiki/Political_economy [Accessed 07 December 2016]

Wikipedia (n.a) Friedrich Engels. Available at: https://en.wikipedia.org/wiki/Friedrich_Engels [Accessed 07 December 2016]

The Guardian (2015) How much do musicians really make form Spotify, iTunes and YouTube. Available at: https://www.theguardian.com/technology/2015/apr/03/how-much-musicians-make-spotify-itunes-youtube [Accessed 07 December 2016]

American Univeristy (n.a) How streaming is changing the Music Industry. Available at: http://au.blogs.american.edu/audio-technology/how-streaming-is-changing-the-music-industry/ [Accessed 07 December 2016]

Hot New Hip-Hop (2014) How the consumption of Hip-Hop has changed. Available at: http://www.hotnewhiphop.com/because-the-internet-how-the-consumption-of-hip-hop-has-changed-news.11624.html [Accessed 07 December 2016]

Wikipedia (n.a) Hip-Hop Music. Available at: https://en.wikipedia.org/wiki/Hip_hop_music [Accessed 07 December 2016]

Wikipedia (n.a) Future. Available at: https://en.wikipedia.org/wiki/Future_(rapper)#2015.E2.80.93present:_DS2.2C_What_a_Time_to_Be_Alive_and_Evol [Accessed 07 December 2016]