The revolution in the music industry has already begun. The elimination of barriers to entry has created new opportunities for artists and companies along the entire supply chain. With the Internet, tastes are fragmenting into a dizzying array of music genres, such as grunge, ambient, acid house, and hip-hop, in addition to the more traditional categories. Digital technology encourages this fragmentation by giving each new splinter group easier access to the means of producing and distributing its own products. The Future of the Industry Electronic commerce will continue to impact the nature of the music industry at a rapid pace, creating new benefits and challenges for each player in the value chain.
Electronic commerce brings more power to the artist than ever before.
The fragmentation of musical tastes allows artists with niche appeal to gain direct, economical access to consumers. The radical reduction in the ability of the labels to monopolize the control of the distribution channel gives an increased number of artists additional bargaining power with record labels. Artists can also use the technology available on the Internet to reduce the costs of record production. Ani DiFranco, a folk singer with her own record label, claims, digital technology has made her success possible. Di Franco s recording costs were reduced using digital instead of the traditional 24-track analogue tape, at a quarter of the cost.