Introduction

The music industry was born about a century ago when innovations allowed the capture, storage and replaying of sound. Ever since, the industry has faced and adapted to many technological advances. Sound technologies evolved from mono to hi-fidelity stereo to Dolby® surround sound. Storage media technologies evolved from vinyl (physical, vibration-based) to audiocassettes (magnetic) to CDs and mini-discs (digital). Replay devices evolved from gramophones to large, in-house stereo systems to compact and portable audio devices. During these transitions, industry players either quickly adapted to the changes caused by the newer technologies or simply vanished from the scene. (For a historical perspective on technological evolution in the music industry, read America on Road: A History of Recorded Sound, by Andre J. Millard, 1995, Cambridge Uni. Press).

Today, the industry is again on the verge of major changes brought on by the rapid evolution of the Internet and the merger of audio and computing technologies. This paper discusses these changes and their possible impacts on the industry structure and its major constituents.