Movie industry experts continuously debate whether the industry's enormous investments in stars pay off. Although a rich body of research has addressed the question of whether stars are critical to the success of movies, previous research does not provide a consistent picture of the impact of stars on the economic success of the respective product. To derive empirical generalizations, the authors (1) provide a meta-analysis of the relationship between star power and movie success based on 61 primary studies reporting 172 effects of star power on movie success and (2) analyze a comprehensive dataset from that industry with n = 1545 movies using two different types of star power measures (commercial and artistic success), while controlling for selection effects of stars. Based on these two studies, four empirical generalizations emerge. First, when ignoring selection effects of stars, the impact of star power on box office revenues is strongly upwards biased. Second, artistic star power is associated with significantly lower box office revenues than commercial star power. Third, on average, movies with a commercially successful star generate 12.46 million US$ additional box office revenues. In contrast, artistic star power does not result in a statistically significant revenue premium. Fourth, commercially (artistically) successful stars have a statistically significant “multiplier effect” of 1.127 (1.083) on other characteristics that influence a movie's box office revenues.
This paper provides an exploratory study of how rewards-based crowdfunding affects business model development for music industry artists, labels and live sector companies. The empirical methodology incorporated a qualitative, semi-structured, three-stage interview design with fifty seven senior executives from industry crowdfunding platforms and three stakeholder groups. The results and analysis cover new research ground and provide conceptual models to develop theoretical foundations for further research in this field. The findings indicate that the financial model benefits of crowdfunding for independent artists are dependent on fan base demographic variables relating to age group and genre due to sustained apprehension from younger audiences. Furthermore, major labels are now considering a more user-centric financial model as an innovation strategy, and the impact of crowdfunding on their marketing model may already be initiating its development in terms of creativity, strength and artist relations.
The music business, as any other business with a strong online presence or that relies on digital technologies for its advancement, has become much more complex and intricate in recent years and there are now many more stakeholders in the music “ecosystem” than 20 or 30 years ago.
Who are these stakeholders, how do they relate to each other and how do they inﬂuence the music network? With these questions in mind this working paper aims to review the current state-of-the-art on new business models in the music industry by carrying out a structural analysis. It looks into diverse examples to illustrate how the value chain of the music business has been transforming in recent years to accommodate for (mostly technological) innovations in terms of music creation, production, distribution and market development. This leads me to propose a model of a value network for the music industry that reﬂects all this. A model that aims to add to the ongoing discussion regarding the reshaping of the music industry and its understanding, serving as the basis for future development of more useful models and tools for the industry and the research community.
Lastly, I also analyze the Norwegian market in its current state to try to reveal opportunities and vulnerabilities in order to suggest key areas of development for the future, including the kind of government action possible and desirable in the musical arena.
The economic geography of music is evolving as new digital technologies, organizational forms, market dynamics and consumer behavior continue to restructure the industry. This book is an international collection of case studies examining the spatial dynamics of today’s music industry. Drawing on research from a diverse range of cities such as Santiago, Toronto, Paris, New York, Amsterdam, London, and Berlin, this volume helps readers understand how the production and consumption of music is changing at multiple scales – from global firms to local entrepreneurs; and, in multiple settings – from established clusters to burgeoning scenes. The volume is divided into interrelated sections and offers an engaging and immersive look at today’s central players, processes, and spaces of music production and consumption. Academic students and researchers across the social sciences, including human geography, sociology, economics, and cultural studies, will find this volume helpful in answering questions about how and where music is financed, produced, marketed, distributed, curated and consumed in the digital age.
The concept of scene has long been used by musicians and music journalists to describe the clusters of musicians, promoters and fans, etc., who grow up around particular genres of music. Typically, this everyday usage of scene has referred to a particular local setting, usually a city or district, where a particular style of music has either originated, or has been appropriated and locally adapted. Examples here would include Chicago blues, New Orleans jazz and Nashville Country music, as well as numerous lesser known instances of local musical innovation and production.
Since the early 1990s, the concept of scene has also begun to acquire currency as an academic model of analysis. Scene’s significance in this respect has resulted partly from the criticism and rejection of prior theoretical frameworks used in research on music, and the local, notably subcultural theory (see, for example, Clarke, 1981; Bennett, 1999), and also due to the influential work on ‘‘art worlds’’ and cultural industries (Becker, 1982). Peterson and Bennett (2004) observe as an academic research model that the concept of scene can usefully be subdivided into three categories: local (Cohen, 1991; Shank, 1994), trans-local (Kruse, 1993; Hodkinson, 2002) and virtual (Kibby, 2000; Bennett, 2002). The purpose of this paper is to assess the different ways that scene has been conceptualised in academic research as a means of understanding music as a ‘resource’ in contemporary everyday life.
Moneyballing Music - Using big data to give consumers what they really want and enhance A&R practices at major record labels
Prithwijit Mukerji’s MA Music Business Management Project paper is an empirical study of the use of social media Big Data to better anticipate consumers’ tastes and better inform A&R processes and decision-making.
By Spring 2014, this was an extremely current subject, the stature of which developed significantly during the course of his research including Shazam’s link-up with Warner Music Group (Feb 2014) and the purchase of The Echo Nest by Spotify (March 2014).
This paper successfully analysed current business trends incorporating latest research and industry-based interviews and as such offered an overview of an emerging and exciting field of study.
The Role of Gatekeeping in the Music Industry: Why Intermediaries Remain Essential in the Digital Age
In this article, we study a two-sided market model of the music industry. Artists either self-distribute their music or sell it via online retailers, which act as gatekeepers by filtering bad music. We find good/bad artists and consumers to be equally well or better off by using gatekeepers due to the quality signaling function the intermediaries provide. Further, more good than bad artists choose traditional distribution via retailers because of the bad artists' relatively higher risk of not passing the gatekeeping mechanism. Despite its higher price and lower variety, also consumers generally prefer traditionally distributed music as its quality is assured. The findings may explain why still only few artists choose to bypass gatekeepers, inspite of the ease and low cost of self-distributing digital music.
This paper nuances our understanding of the ongoing transition within the North American music industry. It extends the existing analysis of the so-called “MP3 Crisis” by exploring the ways in which digital technologies have challenged the entrenched power of the major record labels. In particular, new insights are offered based on interviews with music industry executives who have been active in shaping the industry's response to illegal file sharing. The paper also uses interview data from musicians to investigate the implications of restructuring at the macroscale on creative talent at the microscale. As such, it documents the structures and spatial dynamics of digitally driven independent music production in Canada for the first time.
The Evolution of Taipei’s Music Industry: Cluster and Network Dynamics in the Innovation Practices of the Music Industry
This paper aims to explore the spatial and organisational dynamics of innovation activities in the evolution of cultural industry using Taipei’s music industry as a case study. The existing literature has emphasised that innovation and creativity are driving the evolution of the cultural industry as a result of the spatial proximity effect generated by production systems. However, few studies have examined the innovation practices of the cultural industry resulting from interactive relationships between the urban cluster environment and the mobilisation process of project networks. An evolutionary perspective is used to illustrate how the cluster and network elements of the music industry are intertwined in innovation practices within the Taipei context. As a contribution to the cluster–network debates, this paper argues that the innovation dynamics of Taipei’s music industry are a hybrid feature of Taipei’s cluster environment and the strategic competencies of music project networks rather than the local cluster effect. In conclusion, a different trajectory for the evolution of Taipei’s music industry is presented. Additionally, this dynamic process between cluster and network makes Taipei a hybrid creative platform that is an active element in the cultivation of the innovative competencies of Taipei’s music producers and related workers.
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