23 January 2017
Why So Many Music Technology Startups Fail, According to DataArt Senior VP Media and Entertainment
By Sergey Bludov
Sergey Bludov, Senior Vice President of Media and Entertainment Practice at DataArt, shares with Marketwired some of the reasons for music tech startups failure, including insufficient market research and analysis, untested assumptions and technological self service.
“One of the biggest problems music tech startups face is the inability to effectively analyze the market, determine the pain points, and develop as well as market a viable solution. A widespread misconception is that there are many underserved markets in the music streaming industry, when the truth is that the space is already fairly heavily saturated, with each service having comparable catalogs to offer consumers.
Another problem is that many music industry startups do not actually test their riskiest assumptions when developing a strategy. For example, many streaming services assume that consumers care enough about music to pay significant monthly fees for access, which may be a dangerous assumption.
Startups, at times, feel that they can do it all themselves…Yes, they may have an excellent executive team, industry advisors and exciting new technology, however, it is imperative that they partner with companies that have been in the trenches developing solutions for the industry.”