The impact of disintermediation on independent music business models

  • José Francisco da Cruz Bernardo (Student)

Student thesis: Master's Thesis

Abstract

This work presents an exploratory study of how the disintermediation phenomenon, which has been occurring among the main economic agents of the music industry, is affecting independent musicians’ business models and practices. This phenomenon results from a shift in the technological paradigm, in which the access to global communication networks and digital tools has caused disruptive changes to the current production model, to the access conditions of producers to markets, and to the power relations between economic agents. This study locates within the creative industries scope of research, particularly in music business research. It aims to analyse and expose part of the work reality of producers in one of the most important sectors of the creative industries. Concerning methodology, this study adopts realism for its philosophical stance, in order to address the problem, by carrying out objective discovery and theory development, through objective descriptions of reality. Taking this into consideration, the chosen research strategy has been the case study. A set of seven independent music artists has been purposely selected, based on the strategic approach they take in business and in the evolutive path they are pursuing. Personal semi-structured interviews were conducted with five of these artists, in order to obtain information concerning their business models and practices, which provided the primary data for analysis. The data of the remaining two independent artists was obtained from mixed sources. Additionally, in order to complement this study, data reports from the Artists Revenue Streams (ARS) study have been used as secondary data. This study, led by the Future of Music Coalition (FMC) in the US, assesses whether and how musicians’ revenue streams are changing in this new music landscape. This study indicates that the effects of disintermediation, induced by a technological paradigm shift, are mostly observable in the way independent artists are becoming selfsufficient. They have been leveraging on technology to take on business functions, such as management, funding, distribution and promotion. However, concerning disintermediation, these functions reveal different levels of incidence. This is determined by the power that record labels, the traditional intermediary, maintain over financing and promotion. In the evolutionary path of an independent artist, the need for a professional structure typically grows along the way. This structure maybe maybe provided either by a record label, or by assembling a professional team or resorting to independent services. The consequences of disintermediation can be further demonstrated through some illustrative signs; record labels are readjusting, what can be seen through the renegotiation and the adoption of other contract models, and the lessening of investment in certain traditional business functions. Furthermore, the bargaining power of artists has increased, which grants them more control over their career direction, over the development of their brand, and most importantly, of their creativity.
Date of Award2013
Original languageEnglish
Awarding Institution
  • Universidade Católica Portuguesa
SupervisorLuís Gustavo Martins (Supervisor) & Ricardo Alexandre Morais (Co-Supervisor)

Keywords

  • Disintermediation
  • Business models
  • Independent musicians

Designation

  • Mestrado em Gestão de Indústrias Criativas

Cite this

'