Digital finally overtakes physical in US music market

It’s a moment that many industry observers have predicted for the best part of a decade: the US music market is now more digital than physical, by volume at least. Yet commoditisation increasingly demands entirely new strategies in order to monetise digital music.

According to figures from Nielsen SoundScan and Billboard magazine, digital music unit sales accounted for 50.3% of all music purchases in 2011, the first time that threshold has been crossed in the world’s largest music market.

The US is more advanced in digital than most of Europe. In the UK digital albums still account for less than a quarter of the market, although downloads of individual tracks far outstrip CD singles.

One in three albums is digital in the US, while Americans bought 100m more digital tracks overall in 2011 than the prior year, up over 8%.

But in spite of the digital growth, there are signs that the decline of CDs is slowing. Total album sales were up for the first time since 2004 and physical album sales fell 5% in 2011, significantly less than the 19.5% decline reported in 2010 over the prior year.

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Why I’m gonna fail harder

Creativity is vital for innovation. And, in fact, the ability to innovate has essentially replaced raw materials, labour and capital as the key sources of economic value. Some form of creativity is now the primary source of competitive advantage in the developed world, according to for example economist Richard Florida, as I wrote about in a section of my dissertation.

But how can creativity and good ideas be encouraged? Well, start with not hindering it. One highly typical way of killing creativity is to deter failure. A work environment where people are afraid to fail is doomed to be thinking inside the box and creating safe, but bad and very few new ideas.

In Silicon Valley they have a special word for failure: Pivoting. In perhaps the worlds most innovative cluster, failure just means some change of focus. “Failure, and how companies deal with failure, is a very big part of innovation,” says the Silicon Valley entrepreneur Judy Estrin, a founder of seven high-tech companies and author of a book on innovation. Failures caused by sloppiness or laziness are bad. But “if employees try something that was worth trying and fail, and if they are open about it, and if they learn from that failure, that is a good thing.”

This old, but great ad with Michael Jordan explains an aspect of it well:

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How to spot the future

How can you tell which innovation will become a success?

The terrific May Wired story “How to Spot the Future” notes that anyone trying to figure out which kinds of innovations are most worth paying attention to has to come up with ways to “size up ideas and separate the truly world-changing from the merely interesting”. I thought this was worth sharing!

“At Wired, where we constantly endeavor to pinpoint the inventions and trends that will define the future, we have developed our own set of rules,” writes executive editor Thomas Goetz. “We have seen some common themes emerge, patterns that have fostered the most profound innovations of our age.”

Wired lists seven rules for what to look for:

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World leaders to get their own closed social network

Tibco Software is expected to announce the launch of TopCom, a hyper-secure private club online, serving the role as a social network and video-messaging service that will be made accessible only to the top 200 members of the World Economic Forum (WEF). The idea is to create a “Facebook for global leaders,” allowing the world’s movers and shakers to respond rapidly and assist one another in times of crisis.

TopCom is being officially launched in late January at the annual meeting of the World Economic Forum (WEF) in Davos, Switzerland. It is basically a customized, ridiculously secure version of tibbr, a platform developed by Tibco as a kind of combination Facebook, Twitter, e-mail, texting, and Skype.

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Social media monitoring for beginners

Fredrik Johnsen and I did a breakfast seminar at Creuna about how businesses can start quick and easy with social media monitoring, a prerequisite for optimally utilising the business potential of social media. Check it out, but be ware, it’s in Norwegian! Also check out this blog post I did preceeding the seminar about the same topic, but more into the nitty gritty (also in Norwegian).

The video couldn’t be embedded (darn wordpress.com), but you’ll find it here and the slideshare below:

Is Facebook killing company websites?

The popularity of Facebook is echoing through the entire internet ecosystem and changing the way we communicate with each other and brands. While Facebook is becoming a dominant relationship marketing tool for brands, it seems that instead of increasing traffic to the company website, signs are appearing that Facebook has started to absorb it. Marketers across the globe are wondering whether their brand’s owned websites will become less important. In the future, will users still visit company websites or will they only use Facebook and connected apps to engage with the content of brands?

For many US companies, particularly those with non-transactional websites, visitor figures are in decline, while their Facebook visitors are growing. This is the core of a study by US web analytics agency Webtrends.

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