Pitfalls of Musical Technology Investments

Technology investments, particularly those that relate to the musical industries, are becoming more popular by the day. Music is a commodity that people consume on a daily basis, so it only stands to reason that there is money to be made for people who invest in the right ways. However, there are some pitfalls for investors to remain aware of. particularly as it relates to new innovations within the industry. Here are some tips to follow before you invest in music technologies or the companies that produce the music for the artists.

The Napster lawsuit provides a prime example for why some people fear investments involving online access to music. A college kid created the Napster program to allow people to share music freely. Unfortunately, this did not sit well with the artists who rely on album sales to make an income. In a landmark case, the band Metallica brought a lawsuit against Napster and the ways in which the network shared music for free. The band argued that they should see some royalties from the music they create, even if it is shared online. This form of piracy was simply unacceptable. Although Napster investors did see a quality return for a while, the company eventually foundered and caved through the legal wrangling it experienced.

Copyright laws and file sharing continue to scare people away from music investments. Illegal file sharing accounts for a large portion of the lost money that artists and investors experience on a yearly basis. This has lead to new innovations regarding the distribution of music online. Sites like Pandora, iTunes, and Spotify have made strides to rectify the issues at hand.

People who invest in these companies do not have to worry about lawsuits because they have gone about it the right way. Spotify, for example, is a music streaming service that requires people to pay. Some of the royalties go directly to the artists, so the company continues to see successes. These companies see continued success because they make the artists happy. Fans see that the artists are pleased with the results, and this makes the companies and their technologies much more valuable over time.

On the music production technology front, many investors are experiencing a double-edged sword. On the one hand, new technologies enable bands to create flawless albums and incredible tunes. On the other, purists argue that the music loses its authenticity when technology gets in the way of what is important to the listener. Newer innovations make the old ones obsolete. You must invest in technology that has the ability to grow and expand with the times in order to see your musical investments grow exponentially.