How will Spotify change the traditional music industry - Assignment Example

Download file to see previous pages try, where consumers do not purchase their music, and where artists, producers and the company itself to not generate profits by directly selling music, surely, Spotify generates in a lot of changes in how the music industry works. In this case, the researcher would like to look at how Spotify changes the traditional music industry by using the five forces, which includes the following: Supplier Buyer Competitors Threats of New Entrants Threats of Substitutes In addition, the researcher would also try to integrate the different strategic maps used in the module, in able to provide a deeper breadth and insight into the analysis of the entry of Spotify in relation with the traditional music industry. In particular, the researcher would focus upon using the triangle map and the delta model to give deeper insights on the changes that Spotify will bring to the music industry. How would Spotify then affect the force of suppliers in the music industry? Of course, in the music industry, one of the main suppliers includes the company that distributes music to consumers, which in this case is the Swedish company Spotify. However, it is important to take note of the fact that the supply process is not a simple process, but it is rather complicated; this includes agreements with respect to the artists and the producers of the music that Spotify is about to offer to consumers. In the traditional music industry, the supply process goes this way: the company (which either distributes music through the sale of CDs or downloadable digitized music) pays royalty to the artists of the music. Then, the distributing company would earn profits through the direct sales of the copy of the music, to where the artists would also have some percentages. In this case, extra income for the company...
The "How will Spotify change the traditional music industry" essay, describes the effect of the Spotify on the music business. While Spotify actually believes that “artist payments are increasing all the time as ad revenues and subscriptions go up”, it actually remains to be proven in the future. Such circumstances may pose threats with respect to the supply side of the music industry. However, the major change in the supply side (using the Delta model) would be in the form of redefining the customer relationship, wherein the supplier would need to establish long term relationships with their consumers in order for the company to ensure artists that they would get competitive royalties, as well as ensuring that they would attract enough ads so that they can get enough revenues to make artists happy and make their business profitable.
With regards to the buyer side of the music industry, Spotify also introduces major changes. In traditional companies, they actually entice customers to own albums and other music collections for their favoured artists through their purchase of CDs or downloadable digital files. In this case, the central theme would include inducing consumers to actually own music, and expanding their personal collection.
In this case, the major break with Spotify is that it does not induce consumers to own a personal collection of music; on the contrary, it entices consumers to enjoy the music that they want, when they want, and where they want, without actually owning it. ...Download file to see next pagesRead More