internet is not the problem, it`s the solution

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INTERNET IS NOT THE PROBLEM, IT’S THE SOLUTION
Original written by Professors María Luisa Méndez and Manuel A. Alonso Coto at IE Business School.
Original version, 16 January 2012. Translated 13 April 2012. (R.L. 4 June 2012).
Published by IE Business Publishing. María de Molina 13, 28006 – Madrid, Spain.
©2012 IE. Total or partial publication of this document without the express, written consent of IE is prohibited.
“The paradigm in the music business has shifted and, as an artist and a business
woman, I have to move with that shift. For the first time in my career, the way that my
music can reach my fans is unlimited. I've never wanted to think in a limited way and
with this new partnership, the possibilities are endless. Who knows how my albums
will be distributed in the future?”
Madonna
Burning up iTunes with “Born this way”: A million copies in five days!!
Lady Gaga
A calendar indicates that today is the 6th of December, 2010. It’s been two weeks since the first
interactive online concert in Spain. The group MALDITA NEREA was chosen to inaugurate this
new method of promoting and spreading musical ideas and the pioneering platform of the concert,
eMe (Event Music Experience).
The concert took place in a completely innovative format. Only registered users were allowed to
participate in the concert which was broadcast on Internet on the 21st of November at 19:00 (time
chosen by Internet users). In addition to this, the users had designed the concert (songs to be sung
and their order) and had chosen by vote a song whose meaning would be explained during the
broadcast. In the unplugged performance, the three members of Maldita Nerea spoke to their fans
through the eMe site on Facebook and Twitter. Topping it all off, the group performed a previously
unreleased song.
Today we are going to discuss the strengths and weaknesses of this event in order to apply our
conclusions to future concerts. To this end, eMe chief executive Ramón Sastrón has arranged for a
meeting with Begoña Miguel, head of eMe’s digital marketing agency El Taller, and Maldita Nerea
member Jorge Ruiz. At the meeting, Begoña provides the others with data on the interactive
concert (see Appendix 1), and Ramón is clearly satisfied. Although it has been less than nine
months since the conception of eMe, he can see that his intuition has paid off, as reflected in the
favourable comments of users, in the calls of companies interested in including eMe in their
advertising strategies and the calls of artists and record companies who are anxious to promote
their business through eMe. “Internet is the best way to connect an artist and the public”. In view of
the following data, the first concert can be considered a success:
a.
The average number of users online simultaneously was 9,000, with peaks of up to 12,000.
b.
All registered users were online on the day of the concert. It should be pointed out that the free
registration process had begun in July.
c.
The average duration of viewing time was an hour and a half. This means that the users were
online in a uniform manner during the broadcast.
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More important data:

Little activity was registered in SMS contests, although over 600 text messages were received
to participate in the contests offered.

Five percent of the audience downloaded the single.

The sale of exclusive concert merchandise (necklace, T-shirt and poster) was influenced
entirely by the “urgency effect”: 80 percent of total sales took place on the first day, 15 percent
on the second day and just 5 percent on the third day. Forty-eight hours after the concert, it
was no longer possible to buy the items.
THE MUSIC INDUSTRY: SUMMARY OF DEVELOPMENT AND CIRCUMSTANCES
IN SPAIN IN 2010
THE BEGINNING: “VIDEO KILLED THE RADIO STAR (THE BUGGLES)”
The basic business model of record companies in the 70s, 80s and 90s was as follows:
The process of launching a recording involved the following steps (in this order): hit single,
CD/cassette, another single and, lastly, tour of group/artist.
Technological breakthroughs also affect the development of the music industry. In the 80s, we saw
the advent of digital technology with the reproduction of sound waves through a series of zeroes
and ones. This led to a great improvement in the quality of music products and in the demand for
said products with the appearance of new music players. In the 90s, the MP3 format appeared,
which made it possible to reduce by 10-20 times the required storage space for high-fidelity
recordings and brought together the recording and computer industries.
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360-DEGREE MODEL: “I WANT IT ALL (QUEEN)”
From 2000 onward, record sales fell from year to year. Turnover dropped from €642 million in 2000
to less than €200 million in 2009*. This led to the conclusion that recorded music (CDs and
downloads) is a promotional tool rather than a separate commercial product. As a result of this:

The promotion of a recording has been reduced to two steps: launching of the CD and a tour.
This has done away with the singles market, which had served to provide what is known as
“pre-awareness” in the launching of the recording, as well as an appealing source of revenue
for the music industry and, in particular, a gauge for sales and marketing purposes.

Record companies started to participate in artists’ other business models, to safeguard their
investment in the recording of material and in marketing campaigns involved in each launch

(see chart).
This new way of promoting artists, called a 360-degree model, is at the core of multi-format
launching strategies (cell phone, downloads, tangible media, station presets, ringtones, etc.)
However, it has not allowed record companies to recover the performance registered in their glory
days. It has brought about less risk as less investment is made in new talent and in marketing
campaigns. Nonetheless, some good has come of this, as the demand for live music grows from
one year to another.
INTERNET AND MUSIC: “EVENTUALLY WE WILL FIND OUR WAY”
The incorporation of Internet in our lives, the widespread availability of broadband and the advent
of Web 2.0 have changed the ways that we listen to, consume and enjoy music. The music industry
has seen a revolution and digital music abounds in Internet in the form of:



Streaming technology, as in the cases of YouTube, MySpace or Last.fm.
P2P networks such as Kaaza, eMule, LimeWare or eDonkey.
Search engines such as RedFerret.
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
Wikis, such as Netlabel Catalogue.
Platforms also appeared, such as Napster, which changed the paradigm of the music industry, or
SPOTIFY and iTunes, which allow users to enjoy and/or acquire music through channels within
their proximity. A significant engagement was also achieved as some platforms may be shared in
users’ social networks. All of this led to the following developments at more or less the same time:




Consumption on demand
Increase in digital piracy
Change in media (cassettes to CDs to MP3, etc.)
Adaptation of record companies and artists to new circumstances
- Redefinition of the value chain in the music industry: production, distribution, consumption.
- Use of 2.0 technologies to gain greater acceptance of the general public: interactivity.
- Rethinking of copyright issues.

New business opportunities
- Companies from other sectors have begun to invest in new artists.
- New cell-phone applications with a greater value offering.
- Various innovative ideas offering different experiences.
- Internet: the “free” medium and the long-tail theory
NOW WHAT?: "BEGIN THE BEGUINE”
Data available in 2010 on the music-industry market reveals the following:
The industry is amid a process of profound change and many of its players are seeking a role in
this new scenario. Let’s have a look at the approach of eMe (Event Music Experience).
EME – EVENT MUSIC EXPERIENCE
THE IDEA AND THE VALUE PROPOSITION
Ramón Sastrón and Begoña Miguel were enjoying a drink at the classic Madrid-based bar the Irish
Rover. They wondered when music-industry heads would realize that times had changed. Why is
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the recording industry not able to find a sustainable way to market its goods through the use of new
technologies? Why are other entertainment industries, such as videogames, able to do this?
They agreed that any new approach to music must make use of Internet as a medium to
“communicate” with the public. Ramón had always contended that the music industry was losing
touch with its customers. He fondly remembered a time when songs had to make a big enough
impression on people in order to be included on albums. He also feels that, “music has to offer
users new experiences, and Internet is the best way for an artist to connect with fans in an open,
collaborative and interactive manner”. (Remember that in 2010 the 2.0 format had not yet seen
consolidation.) The key word is experience. The recording industry has not yet been able to create
and offer new experiences to consumers. The sector’s most powerful experience is live music, and
its players must consider making this element a part of the digital realm.
Ramón is no stranger to the music industry. Throughout his career, he has been involved in
marketing and audiovisual content. One of his first jobs was at the head of Universal Music Spain
for the record labels Mercury Records, Island, RoadRunner and Polydor; he was also responsible
for artists such as U2, Elton John, Bon Jovi, The Cranberries, Texas, Jack Johnson, Shania Twain
and Mark Knopfler. Afterward, he was marketing manager of Universal Pictures and in charge of
the launch on DVD and BD of productions including Miami Vice, King Kong, Shrek, Mamma Mia,
Mummy, Fast and Furious, Hellboy 2, Wanted and Robin Hood.
Clearly, the business had to find a way to make use of the Internet to offer new music experiences
that were spontaneous and in close proximity to consumers and largely based on exclusivity and
the magic of the moment, without shunning free access or ceasing to seek profitability in a creative
manner. In addition to this, live music was a format that had not registered a decline. Live concerts
on the Internet seemed to be the ideal solution, but what content would be used? Ramón thought
of only one group to inaugurate the concerts, because its presence and leadership in a musicoriented Internet became stronger with each passing day: Maldita Nerea. Ramón explained his
idea to group leader Jorge Ruiz, who quickly saw the opportunities implied in the new format and
committed to the idea, eventually becoming fully involved in the project. With three members on
board, it was time for action. Begoña Miguel took charge of marketing strategies on social networks
and of the designs and technical development of the platform. Ramón, as the head and the
promoter of eMe, was in charge of dealing with the artists, of agreements with record companies,
of sponsorships and of e-commerce.
The success of Maldita Nerea in eMe could mean the success of a new model for artists and
record companies. Jorge encouraged his followers through social networks and presented the
project to the recording industry. A few days before the concert in eMe, he posted the following
message on his blog:
“We believe in a new approach to the music business specifically and to entertainment and culture
in general, just as we believe that at present it is necessary to consider many new approaches to
lines of business that have worked until now. This is of vital importance in some businesses. We
want to show the world that Internet is not going to kill music. Today, people listen to music more
than ever, just as people see more films than ever before. There is such a wide range of culture
and music available that we might say that it’s infinite. Access to content and culture makes our
society better informed and better prepared, and we make our choices with a better
understanding and greater freedom. With these ideas, we are participating in eMe EVENT
EXPERIENCE, which is a new project that will constitute a new experience for music fans. Native
and exclusive concerts for Internet: concerts where the public decides, concerts that are not a
one-way channel between artists and their audiences. In particular, this new project will allow for
concerts that are adapted to modern times. After several months of planning, hard work and
development, we are launching eMe: a project designed for the rethinking of part of the business”.
So what is eMe’s value proposition? It is an online-music platform that allows registered users to
enjoy free concerts and actively interact with artists. Therefore, it is an opportunity for groups such
as Maldita Nerea and a new experience for fans. The project makes full use of the potential of
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digital music and is clearly a value proposition that takes into account the characteristics of new
consumers.
Let’s look briefly at its strengths:

FREE ACCESS: The concert is free for registered users.

ORIGINALITY: It offers a different kind of product and the opportunity to interact with artists in
a completely new way. It is also a native product for Internet and is authentic in format and in
essence.

PARTICIPATION: It involves a high degree of collaboration, as the user is an indispensable
part of the creation of the experience.

EXPECTATION: This is different in each case, as it involves individual experiences. Also of
great importance is the fact that it is offered via streaming technology and users are not able
to relive the same sensations.

PERSONALISATION: Users create concerts according to their preferences. In the weeks
leading up to the performance, users vote on the songs to be performed, the order in which
they will be performed, the starting time of the concert, etc.

VIRALITY: One of the options of eMe allows users to invite friends by adding the concert to
their Facebook wall. Virality also comes into play upon the incorporation of artists’ social
networks in the eMe community.
E-COMMERCE AND ACTIVE SPONSORING IN EME’S BUSINESS MODEL
E-commerce and active sponsoring are a significant part of the business model of eMe.
E-commerce: Ramón believes that the music industry has failed to produce a sustainable model of
e-commerce. Sales from OPEN DISC or artists’ sites (such as El Canto del Loco) are insubstantial
and do not have a minimum amount of rotation that might make for an appealing way to boost
sales through the Internet. He insists that, rather than products, what consumers buy are
experiences. For this reason, e-commerce must take this approach. We must not overlook the
reasons for the success of models such as buyvip, privalia or vente-privee, which include: pricing,
urgency—limited units, use of time with special offers 48 hours after the concert, and exclusivity
(material created especially for the concert).
Active sponsoring: It seems that the music industry has failed to support the role of brand
names in music. Corporations understand the power of engagement of music, and they regularly
approach artists to sponsor their tours (LG-Alejadro Sanz), using the artists as brand images
(SEAT-Sueño de Morfeo) or their songs in advertisements. However, until now this has been
passive sponsoring in which the artists received a fee for allowing the brand to form a part of the
tour or for participating in the marketing of the brand. Ramón wants sponsoring to be a “win-win”
relationship between artists and brands, especially in view of corporations’ needs to add effective
and economic content to social networks. Active association of brands may be considered another
one of eMe’s strategies.
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COMPETITIVE ANALYSIS
Several business models are in competition with eMe. The following is an analysis of these models,
which are compared below in the chart.
Appendix 3 offers a comparison of the new models and eMe based on the following variables:
product offered, user experience, communication and business model.
THE FIRST INTERACTIVE ONLINE CONCERT
MALDITA NEREA
Maldita Nerea is a pop group that caught the public’s eye in 2003 with its album “Cuarto Creciente”,
released by Universal. The group got off to an excellent start, opening for acts such as Alejandro
Sanz, Juanes and Maná. The crisis of the music industry and the need to cut back investment
forced the group’s departure from the company because of the need to focus on recordings that
would bring short-term profit, abandoning up-and-coming artists. At that time, group vocalist and
leader Jorge Ruiz decided to take control of his career, which he would associate with the quality of
his lyrics and with direct contact with his followers, by harnessing the new channels of
communication provided by Internet (forums, blogs, social networks, etc.) In the wake of the selfreleased album “El Secreto de las Tortugas” in 2008, the group set off on a promotional tour that
would last two years. A key concert was the November 2009 performance in Sala La Riviera in
Madrid, after which Sony noticed the group’s massive appeal and said the magic words that Jorge
had been waiting for: “We’ll give you whatever you need”. The group asked for a luxury-edition CD
+ DVD (it was the company’s most expensive CD in 2009) and it was sold at a very competitive
price (less than €10).
The group became the most successful band in 2010, as the following data shows:
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
Leader in all social networks (over 10 million viewings in YouTube and many thousands of
friends on Facebook, Tuenti and Myspace).

The album “Es un secreto… no se lo digas a nadie”, released in May 2009, went straight to
the 16th-ranked position in its first week on the market, and, 18 months later, remained within
the top 100 albums sold.

Among the top one hundred groups heard on Spotify, and the album is among the three most
popular in Spain, with up to five songs in the top 100. In terms of domestic artists, it is the
most popular album on Spotify in Spain (sixth-ranked including international acts) and the
song “El secreto de las tortugas” is top ranked on iTunes.

Five nominations for the “40 Principales” awards in 2010 in the categories of best group, best
song (“Cosas que suenan a…”), best tour, best videoclip (“El secreto de las tortugas”) and
best new artist.

The tour of the group’s last recording is to conclude on 18 December, with over one hundred
concerts, including sold-out performances in the venues Palacio de los Deportes in Madrid,
Club San Jordi in Barcelona and Palacio de los Deportes in Murcia.
The group’s philosophy focuses on the following:
1.- Proximity. In close contact with their followers, which is a term that they prefer to “fans” (due
to the connotation of “fanatic”). They make an effort to remain in contact with the followers
before and after concerts and, of course, on social networks.
2.- The songs. They do not care for filler material. All compositions go toward the album because
they all have the same potential for being the first single.
3.- Social networks. This is a song-based project that was created and developed on the
Internet. The group intends to continue growing with the networks.
4.- Promotion 2.0. YouTube is the platform used to put their songs in circulation. On one
occasion, after the premier of a song on Internet, their followers sang it a week later at a
concert. The group included on its most recent album the songs that registered the greatest
online demand.
MARKETING
Standard marketing techniques and e-marketing strategies were used to reach the audience
targeted for the first eMe concert. In this regard, Begoña said that e-marketing played an important
part of the process because eMe happens in Internet for users who are already online.”
Most of the communication of the event took place on social networks that correspond to Marketing
2.0, making full use of eMe’s strategies as well as artists’ networks.
Additional strategies included newsletters, public relations, the press and text messages.
The following are the main actions taken in social networks and their results.
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NETWORK
ACTION
DATA
1. Fan Pages: Creation of an eMe
page in Facebook:
http://www.facebook.com/pages/eM
e-Event-MusicExperience/113190178729611
2. Open Graph (Facebook Connect).
A window opens on the eMe page
so that users can register as eMe
fans.
3. Facebook chat: Use of Facebook
chat facility on the concert page.
620 followers.
Over 15,000 Facebook chat
messages during the concert.
1.
Monitoring and interaction with
most active followers of Maldita
Nerea on Twitter
2. Tweet with hashtag #malditanerea
The day of the event,
#malditanerea was a trending topic
in Spain.
Maldita Nerea saw an increase in
its followers (8,000 now vs. 2,000 at
onset of campaign)
1.
The song premiered by Maldita
Nerea during the concert was
uploaded to YouTube ten minutes
later and had 400 viewings over the
following two hours. The video was
sent and saw replies on all social
networks.
Creation of YouTube channel for
videos explaining the eMe project.
- Maldita Nerea – “Dios las cría y
ellas se juntan”
- Maldita Nerea – Register in
m-event.es
THE MEETING AFTER THE FIRST INTERACTIVE CONCERT
Ramón is going to prepare eMe’s marketing plan, after months of not having enough time to get the
job done, and Begoña is going to prepare a new SMM (social media marketing) plan. Let’s help
them. To this end, we also have Jorge Ruiz and his “lateral” view of the music industry, as used to
great effect by his group Maldita Nerea.
Before getting down to work, Ramón speaks about the first interactive concert, saying that Maldita
Nerea created the experience with people and the platform is the least important thing.
“INTERNET IS NOT THE PROBLEM; INTERNET IS THE SOLUTION.” STRATEGIC
ANALYSIS OF THE OPPORTUNITIES OF PROPOSALS SUCH AS THAT OF EME
FOR GROUPS SUCH AS MALDITA NEREA
Historically, the value chain in the music industry is as follows:
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With the advent of social Internet we have “Production 2.0”. The “Prosumer” link in the chain
appears after “Marketing and Promotion”, and “Search for Talent” is split into two: “Knowledge of
Audience” and “Promotion of Talent 2.0”. Hence, in the “2.0 era”, the value chain would be as
follows:
Modern times call for a revision of the value chain in the music industry. The search for talent
seems to be unnecessary as any self-proclaimed artist can put his or her work on display before
the world through the Internet. Production of the hard copy and its distribution is losing importance
at an increasing rate. This turns record companies into a kind of service agency that guide their
artists’ careers on the basis of marketing criteria. In view of their shrinking role, it seems logical to
assume that these companies will go through a major overhaul, although there will continue to be
ways to add value to the creative process through new marketing techniques. The range of
possibilities available to artists will grow, becoming a nexus between completely individualised and
independent management and complete management in “360-degree” contracts with record
companies, with intermediate variations depending on the level of involvement and the bargaining
power of both parties.
1.
PRODUCTION 2.0
Crowd-sourcing. Generation of content with the participation of prosumers (contests to make
videos, promotional posters, album covers, corporate image, free concert tickets, they teach
you how to play guitar, you get to meet the group): “blended reality”.
Crowd-funding. Micro-donations to support initiatives and generate resources for each of the
groups.
Partners. The platform lets advertisers make use of contextualised advertising, which allows
for product development in close association with artists (fashion, consumer products, etc.)
2.
PROMOTION OF TALENT 2.0
We can make a distinction between well-established artists and new talent.
Well-established artists:
 provide the platform with credibility
 provide the platform with scalability
 universalise the platform
In the case of emerging artists, the process would be as follows:
 Brand-oriented YouTube channel: 2.0 (to limit consumption of resources on own
platforms).
 Success or failure not determined by platform but by audience through voting and
comments.
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 Ranking/evaluation gives way to following level of promotion or commitment of the platform
(prosumer: audience also participates via creation of video or logo, for example).
 Optimisation of allocated funds.
3.
DIGITAL DISTRIBUTION
Different distribution channels are used and the mix is created on the basis of the ranking and
fan support:







4.
Streaming
Cloud
Unbundled purchase
Subscription
Online concerts
Multi-screen
2.0: recommendation, the prosumer creates new content for the platform.
DISTRIBUTION AND MARKETING FOR ARTISTS
Although some artists criticise the Internet-based revolution of the music industry, others have
decided to harness the potential of the phenomenon. Most rising stars belong to the
generation of MySpace or YouTube because they got their first recording contract after the
digital revolution.
Today, many artists can benefit (especially newcomers to the market) from opportunities
provided by Internet. Pablo Alborán is one such example.
Concert tickets are the main source of revenue, due to low per-sale earnings of the traditional
system and the difficulty of reaching the market. The key to survival is achieving visibility in
advertising and promotional undertakings.
Internet is an ideal tool for artists who are not sufficiently backed by record companies. One
only has to release a recording in MP3 format under a Copyleft license on websites such as
MySpace or YouTube.
These strategies work so well that over 80 percent of groups and singers offer samples of
songs on their websites, and 66 percent sell recordings directly through Internet. Nearly all of
them use Internet to put forth ideas and seek inspiration, and nine of every ten go online to
promote, announce or offer music.
5.
MARKETING VIA PROSUMERS
Social Media looks for the following:






Making each star a brand name: branding with all attributes and values
Connection and interrelation
Knowledge of audience (profiles, communities, forecast models)
Social recommendation
Merchandising
Virality
Partner brands obtain:
 Product Placement (segmentation of audience):
http://www.youtube.com/watch?v=cXYOXDLyKSU
 Blog sponsoring, micro-blogs and videoblogs
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NEW POSSIBILITIES
Last year, we saw a real 2.0 musical phenomenon: U2 rebroadcast over YouTube their concert at
the Pasadena Rose Bowl. Although there have been similar endeavours in cinema, this was the
music industry’s first such event. Impressive results were obtained, in YouTube viewings and clicks
on Twitter and Facebook, as well as purchases made at Amazon and iTunes (where a link was
provided to donate to the fight against AIDS).
Something must be going right when three percent of tweets worldwide (from zero) is registered in
less than an hour, becoming the most important trending topic of the day. However, let’s not forget
that Twitter is not of a general scope like Facebook but rather is specialised for savvy users, which
is a realm that is not understood by most Internet users. How many users discovered this through
the first interactive concert? There it was onscreen, imbedded just below the video, offering the
possibility to communicate in real time with people all over the world. The simple answer lies in the
fact that there were over 20,000 clicks on the Twitter link and over 46,000 on the group’s Facebook
link, as well as the 105,000 comments on U2’s YouTube profile. A huge success of an engagement
in just over 90 minutes.
What about record sales and donations? Over 37,000 clicks on recordings and 35,000 on iTunes,
and over 21,000 clicks on donations, with a declared conversion rate of nearly 40 percent. This is
clearly a new tool to be taken up by groups—such as Maldita Nerea with platforms such as eMe—
that know how to make full use of its potential.
APPENDIX 1
DATA ON FIRST CONCERT
AUDIENCE DATA

An average of 9,000 users connected simultaneously, with peaks of up to 12,000.

The number of database subscribers is 6,750. An average of 1.7 individuals per subscription
came online to see the concert.

The average viewing time was an hour and a half. In other words, users stayed online
throughout the broadcast until the end of the concert.
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SMS/E-COMMERCE DATA

Scant activity in SMS contests. Over 600 SMS received to participate in contests.

The single was downloaded by five percent of the audience.

Gross revenue from e-commerce (necklace + T-shirt and poster) was a determining factor.
Urgency in purchases eighty percent on first day, fifteen percent on second day, five percent
on third day.
APPENDIX 2
JORGE RUIZ’S CONCEPTUAL MAP (MALDITA NEREA)
Internet
Content
It’s everything!
Maldita Nerea
What:
1- Songs
2- Web content (blog, social networks).
Taking positioning into account:
what we are and what we want to transmit.
Users
Yes. This is the
Yes. In two senses:
participate
basis of the idea.
-Free interpretation.
in content
Promotion of user’s interpretation, with
appealing concerts, for example.
Distribution
Cloud: MASSIVE
and promotion
Word of mouth.
Virality.
No fans: artists and followers are on same level
Success.
Downloads
Measured on two levels:
Profitability
Online sales
-Personal
Advertising
-Economic
For example: concerts, copyrights, merchandising, royalties,
sponsorship, physical and digital sales, advertising
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APPENDIX 3
COMPETITIVE ANALYSIS
Player 1: Ustream
PRODUCT
 TV long tail.
 Allows for live rebroadcast of any type
of event.
 Assortment of television mini-channels.
 Puts people and communities in contact
around a central interest.
 Products and services:
Advertising and media, production
services
 Over 85 million dollars in venture
capital.
USER EXPERIENCE

Any person online with a camera can have
his or her own TV channel.

Free events, pay per view, etc.

Interaction through social networks: chat.
BUSINESS MODEL
COMMUNICATION




15
User support.
Positioning in high-profile events,
celebrities.
Cell-phone pioneers
Association with iTunes and Amazon.
IE Business School
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
MK1-146-I
Player 2: Twit Sessions
PRODUCT




USER EXPERIENCE
Live online music of Chilean
bands.
Claim: “Music Without Frontiers”
Sale of “best moments”.
Sponsorship, advertising
nearby venues
BUSINESS MODEL


Through social networks.
Chat system: request songs, etc.

Tours in Chile to find local bands to be
presented through the website.
of
COMMUNICATION
16
IE Business School
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
MK1-146-I
Player 3: Jukezoo
PRODUCT



USER EXPERIENCE
Online community that puts
fans in contact with bands.

Donations.
Sale of online
space.

BUSINESS MODEL
advertising

Allows users to stay online: arcade games, chat,
social network, quizzes.
Share photos, articles, etc. with network of
friends.
Lacking clear value proposition: dating sites,
games, family tree, etc. aimed at armed forces.
COMMUNICATION
17
IE Business School
MK1-146-I
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
Player 4: Eristoff Internative Festival
PRODUCT
USER EXPERIENCE

Online Music Festival: live concerts
through the internet on Mondays when the
moon is full.


Sponsorship of Eristoff.
Use of database by company.
BUSINESS MODEL



Interaction with band, choose stage,
select cameras and act as
commentator.
Live or online attendance.
Database of registered users.
COMMUNICATION
18
IE Business School
MK1-146-I
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
Player 5: Big Live
PRODUCT





USER EXPERIENCE
Music: videoclips and live or delayedbroadcast concerts.
Fashion: Delayed broadcasts from New
York, Paris, etc.
Viewed through YouTube.

Sale of content (currently unavailable).
Big Live money to be exchanged for
content.


BUSINESS MODEL


Online chat to share comments with
other users.
Creation of user profile.
Share with Facebook and Twitter
friends.
Database of registered users.
Facebook and Twitter webpages.
COMMUNICATION
19
IE Business School
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
MK1-146-I
Player 6: YouTube
PRODUCT
USER EXPERIENCE

U2 channel.



Diverse advertising
formats.

BUSINESS MODEL
Live concert experience.
Channel allows for enabling of Twitter access for
comments.
YouTube channel, forums, general-interest media, blogs,
music and digital forums, etc.
COMMUNICATION
20
IE Business School
MK1-146-I
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
Player 7: Vevo – Music Evolution Revolution
PRODUCT




USER EXPERIENCE
Biggest catalogue of premium videos (1.5
million streaming videos) of leading record
companies (Universal, Sony, etc.)
High audio and image quality.
Limited to USA, Canada, Japan and
Mexico.
Advertising.
BUSINESS MODEL



May be seen on different types of
screens (computer, TV, cell-phone
and iPad).
Recommendations and news on
music on main social networks.
Via own website and leading social
networks:
YouTube,
Facebook,
Twitter and blog.
COMMUNICATION
21
IE Business School
MK1-146-I
INTERNET IS NOT THE PROBLEM, INTERNET IS THE SOLUTION
Player 8: Show na Web
PRODUCT
USER EXPERIENCE

Real-time broadcasting of concerts and
events.
Culture-oriented interviews on controversial
and informative issues.


Limited to Brazil.
Fee charged for
advertising.
rebroadcasting
and
BUSINESS MODEL


Possibility of online viewing only.
Low user interactivity.

Via own website, Facebook and
Twitter.
COMMUNICATION
■■■
22