The 2007 Digital Media Survey credits social networking sites like MySpace and Bebo for allowing more people to discover music online rather than via television or the radio. The report polled 1,700 people between the ages of 13 and 60. One key finding is that the percentage of people who use a social networking site has increased from 74% to 86%, and that 40% of those who do have music embedded in their profile pages. This number increases to 65% among teenagers. According to Ben Bland at the Telegraph, the CEO of Entertainment Media Research explains this phenomenon as follows:
â€œSocial networks are fundamentally changing the way we discover, purchase and use music. The dynamics of democratisation, word of mouth recommendation and instant purchase challenge the established order and offer huge opportunities to forward-thinking businesses.â€
The key words there are â€˜forward-thinkingâ€™. The music industry has been slow (at best) to embrace the new opportunities offered by the popularity of the online music and the increased use of social networks for peer-to-peer file sharing. Margins on CDs have been dropping steadily the past several years, while illegal music downloaders have increased to 43% of those polled this year. The one step the music industry has taken to court the web audience – offering legal downloads – has slowed in growth, improving only 15% this year, compared to 40% last year. The head of music at media lawyers Olswang has some advice on how to correct this issue:
â€œThe music industry needs to embrace new opportunities being generated by the increasing popularity of music on social networking sites. Surfing these sites and discovering new music is widespread with the latest generation of online consumers but the process of actually purchasing the music needs to be made easier to encourage sales and develop this new market.â€
Like other industries that deal with the 13 – 30 demographic, the music industry is inevitably changing with the growth of social networking online. If the Olswang report points out anything, however, itâ€™s that every time music industry makes some degree of progress, it quickly gives it away.