From ICA Institute blogger, Erik Rostad:
A recent Chinese start-up called WaWaWa (www.wa3.cn) will test a subscription service that evens out to about $0.03 per song. At this point it is unknown whether or not Chinese consumers will pay even $0.03 per song. The content is mostly from independent artists, but this is pretty telling.
China just passed the USA in the number of internet users. Increasingly, China will begin having a much larger impact on the market and pricing. In this case, this is a pretty significant test, so to say, for the Chinese consumer. On the whole, China is notorious for downloading copyrighted material for free.
This is really amazing when you think about it. The music business sales model has changed so much that we are now asking ourselves the question of whether or not the country with the largest mass of internet users will put down $0.03 for a song.
The song is no longer the widget of value for an artist. This just shouts that the future of music will be more about the experience. The live music experience. Learning how to communicate effectively with your fan base who doesn’t just buy the $0.03 song, but experiences that song deep within their soul. The fan who has the experience will buy the merchandise, will attend the shows, and will pay to be a part of a fan club where advanced tickets are provided.
Companies will also tap into this experience factor for music. When a client has an experience with a brand and there is a song attached to that experience, perhaps through advertising, that client will associate the experience the music creates with the product.
By the way, at this point, you can only access the WaWaWa site by using Internet Explorer. Firefox and Opera don’t work.
Music Industry Blog: http://www.kokopellitimes.com/
Recently, Dr Steinbock, the ICA Institute’s Research Director of International Business, has been lecturing in Shanghai’s leading think-tanks. He will soon be in New York City to explore the slowdown in the United States. Meanwhile, new publications have been released. Please find enclosed a sample of highlights:
“Senator Obama’s presidential campaign has entered a new stage,” said Dr Steinbock in Shanghai. “The appointment of Jason Furman, who worked closely with former Treasury Secretary Robert Rubin, as his economic policy director, triggered a bitter reaction from Obama’s union supporters. The appointment allies his campaign with leading economic centrists in the Democratic Party, particularly Rubin who orchestrated President Bill Clinton’s economic policy of promoting free trade and reducing the federal budget deficit. The inclusion of economic centrists in the Obama campaign is likely to reinforce his support in Wall Street and the private sector in general.”
“OECD metropolises prepare for the future by moving higher in the value-added chain, from cost avantage toward innovation,” notes Dr Steinbock in Talouselama, the leading Finnish business weekly (June 6, 2008; in Finnish). “In the long-term, emerging metropolises will follow in the footprints… The new rivalry of the cities requires increasing cost-efficiencies. In the advanced economies, the wealthy metropolises enjoy old but fading competitive advantages. The new Asia’s emerging metropolises are building a bridge into the future.”
The essay is based on his research for the Committee of the Future of Eduskunta, the Finnish parliament.
“In the 1970s and 1980s, the Japanese companies tore apart the cost structure in a few industries, particularly cars and consumer electronics,” concludes Dr Steinbock in the new Kauppapolitiikka (Trade Policy, Finland’s Ministry for Foreign Affairs, June 3, 2008). “That was only a prelude. In the coming decades, the rise of China and other large emerging economies will result in tearing apart the cost structure in industry after industry – through cost advantage and innovation.”
The column features comments by Jack Welch, former CEO of General Electric, on globalization and the Japanese challenge.
“There is an alarming trend among multinational companies,” notes Dr Steinbock on the latest CMO study. “Their own marketing and sales leaders give themselves failing grades when it comes to assessing their go-to-market capabilities. And while companies acknowledge these deficiencies, they’re not taking the steps necessary to create marketing and selling efficiencies.”
In a recently released study, CMO partnered with the Boston Consulting Group (BCG) to explore the in-depth insights from more than 1,000 global marketers on the challenges and obstacles they’re facing in optimizing marketing and selling effectiveness. Dr Steinbock serves as spokesperson of a mobile initiative by the Chief Marketing Officer (CMO) Council, which represents 2,000 leading technology firms. More of the CMO/BCG results later.