Economics of Online Music: Market Impacts of Online Sharing

Emerging technologies can have significant disruptive market impacts. The music market, in particular, has faced a rather rocky road. The market and its participants have been unsettled by the emergence of file compression and sharing technologies together with the materialization and widespread access to high speed networks. The development of killer applications (e.g. Napster, eDonkey – Bit Torrent based) utilized these underlying technologies to make sharing easier and, to some extent, a positive social experience. More recently, the easy of unbundling albums and even songs has opened new market niches for music, including ring-tones and integration in video games.

Our ongoing research program has been structured to address a variety of issues facing today’s music industry, including:

i) can we better understand the actual impact of online file-sharing on the market for music?

ii) can we design strategies for businesses to effectively leverage information from the online file-sharing networks?

iii) do legal threats and actions impact sharing behavior?

iv) how have advancing technologies impacted the music album life cycle?

v) since music items are now easily unbundled, is the album dead? Is there an emerging niche for the “themed bundle”?

And the following future research questions:

vi) can we design a better experience for the consumer such that they will have an incentive to buy from a legal store rather than pirate?

vii) is music as a stand-alone product reaching the end of its useful life? is the future commercial success of music dependent on its role in product extensions or as part of an integrated experience rather than as a stand-alone product?

All Welcome