Basic rules of economics dictate that once supply and demand for a good are at equilibrium, the price point and supply levels are at the most efficient levels to meet demand.
Where supply has grown into abundance and demand remained stagnant the value of goods must be decreased to correct the market back to equilibrium. The supply and demand for entertainment content behaves in precisely the same fashion. Today the supply of music is greater than ever before. Supply has been significantly increased by technological innovation drastically lowering production costs of content, which has caused both professional and amateur content to be in abundance. The modern consumer is inundated with content unlike any other time in history. Additionally, the very way consumers entertain themselves is shifting due the fact that much of this fresh pool of content is primarily available online. Scores of teens are turning to the Internet as their primary source of entertainment.
In a study conducted by www.cybersentinel.co.uk, researchers found teenagers spend an average of 31 hours online per week.
These are consumer entertainment hours that only a few short years ago would have likely been occupied with off-line traditional creative media. This indicates there is a fundamental and substantial change occurring in young consumers preferred method of entertainment.
As consumer demand is changing the entertainment market from the ground up, businesses are in a constant state of trial and error attempting to recapture consumers’ increasingly diluted and unpredictable interests. Today’s Darwin-esq digital wild west is undoubtedly powered by demand. The entrepreneurs at Amiestreet.com are taking this concept quite literally. They have created a website that prices mp3s on the basis of consumer demand. The site allows artists to upload their material, which is first offered for free and as more people purchase the songs the price goes up, with a maximum of 98 cents per track. This model has attracted the participation of some big name such as Johnny Cash and Sarah McLachlan. Amiestreet.com’s mantra is “we’re committed to giving every artist a shot at being the next big thing, and you the chance to discover them first.” This philosophy is one that describes the sentiment of many tireless music aficionados and musicians alike. Continue Reading…