Page 150 - AC/E's Digital Culture Annual Report 2015

Cultural business models on the Internet150If we observe developments from 2000 to 2013, we find that, despite one of the most important economic recessions in recent history, the total revenues of the record sector have fallen by only 3%. According to data gathered in the IFPI’s annual study, in 2000 60% of music revenues came from recorded music, whereas the figure was down to 36% by 2013; the rest came chiefly from live music, which has increased by more than 60% in the same period. 7 These statistics appear to indicate that the sector is not experi- encing a crisis but rather a deep change that is mainly affecting traditional business models.The music consumption model that currently seems most firmly established is led by the access-by- subscription model.The music consumption model that currently appears to be most firmly established, despite the uncertainties over the distribution of royal- ties, is led by the access-by-subscription model such as that of Spotify. The Swedish company currently has more than 40 million users, 10 of whom pay for its services. Other services such as Deezer and Pandora or Apple’s recent acquisition of Beats appear to indicate that the future of music consumption lies in streaming services. It remains to be seen how the relevant business models will develop and how revenues will be distributed across the value chain.Nevertheless, the sector’s transformation has only just begun. Whereas the main source of income of concert musicians and promoters is live events, technological platforms obtain theirsfrom streaming services. We will have to wait and see how the rest of the agents reposition themselves with respect to the new ecosystem.PublishingAlbeit with a slightly bigger delay, the publish- ing sector – in both the educational and purely publishing aspects – is in the grip of an unstop- pable process of reinvention, as occurred earlier with music and film, though with significant particular features of its own.Compared to the consumption of music or video in which the average user’s experience does not undergo any changes, reading on paper is different from reading on a screen. Although it may slowly evolve, the studies available to date8 show that the paper format for reading contin- ues to offer sensory advantages over reading in digital format. Books as physical objects con- tinue to hold considerable appeal compared to newspapers or discs, which have lost value, and have accordingly experienced greater changes in their traditional value chain.The sectorial data gathered in the analysis ofthe publishing market in Spain (Análisis del Mercado Editorial en España9) indicates that 2013 closed with a turnover of 2.708 billion euros, representing a drop of 11.7% with respect to the previous year – lower figures than thoseof 1994 for the sector. This fall is common toall the channels but is particularly significant in digital, which slumped by 14.9%. In Spain 23% of published books are digital, meaning that this format accounts for only three out of every one hundred euros of revenues. This abnormalityThe challenge of the digital transformation of the culture industries