From Digital Music News:
The downer argument is that price-points are careening towards zero, scarcity has evaporated, and monetization is a lost cause. But what about all the vast number of passives? The group that isn’t engaged, isn’t paying, or just hasn’t been approached the right way?
Here’s the take from ‘Tommy Boy’ Silverman, a fabulously successful executive in the old model, and someone with some interesting questions about the new. He just made these comments in a broader interview with Musician Coaching.
The number I’ve heard recently is that there are about 200 million music buyers in the world. And there are about seven billion people in the world. So, if we can make that 200 million grow to 250 million, we can make a little bit more money. But that would only take the net world music business from $16 billion to $20 billion. It won’t take it back to its peak in 1999. It will just make it a little bigger.
If we can get the people who are buying music to buy more music, maybe we can push it a little further than that. And if we can get them to spend a little more money, we might be able to take it even further than that.
But none of this will take us to a $100 billion worldwide business. The only way we’ll get there is by finding a way to monetize passives. Because, the passives outnumber music buyers – there are six billion passives vs. 200 million music buyers.
There are six billion activated cell phones in the world. And there are 1.2 billion smartphones activated now, which means smartphones that are actively being used, with active subscriptions that have been paid for.
The trend everywhere is moving towards smartphones. The entire world is going to open up to that level of accessing music.