Monetizing Social Music

As CD sales continue to fall off the proverbial cliff and the paid download market fails to take up the slack, social music destinations prosper, utilizing the power of the Web to a degree that download stores never did. Although the most sophisticated destinations will remain the domain of tech-savvy music aficionados, the mass-market components of social music have already helped change the way people interact with music online. As Apple dominates the paid download market, consumer product and services strategists must incorporate social music best practices to develop differentiated, next-generation music offerings. Social music may not generate much revenue now, but monetization's effectiveness must — and will — improve. In doing so, it will become an increasingly important revenue stream that helps fill the gaping hole left by lost CD sales. But, most importantly, social music destinations will continue to build highly engaged audiences and deepen the relationship between fans and their music.