Immersive Music: the future of the record industry PRESENTED TO COLUMBIA RECORDS SAM KRAUSE, TAYLOR...

Transcript of Immersive Music: the future of the record industry PRESENTED TO COLUMBIA RECORDS SAM KRAUSE, TAYLOR...

Immersive Music: the future of the record industryPRESENTED TO COLUMBIA RECORDS

SAM KRAUSE, TAYLOR HEYWOOD, GREG SNYDER, TALAL BARAZI

Music Industry Revenue

[some pictures of the brands and maybe do it in smart art, whatever works – put however many slides here that you need to make it work] – also pull that graph out of the google doc and model your explanation of the problem around that perhaps

$63

$71

$26

The Content

Live Concerts Immersive Albums

Advances In VR

Latency Field of View

Affordability

Compatible Headsets

How It Works

Film Format

Load Watch

Possible Formats

Graph of HMD unit sales

Total Market for VR Headsets

300.2MM

Market Penetration in 2018

300.2MM 22.5MM

The Market for Immersive Music

300.2MM 4.1MM22.5MM

Extended Financials

Unit Price: $40

Contribution Margin: $24

Breakeven Units: 204,167

Profit Potential: $31,830,000

Fixed Costs

Investment per album cycle (in USD)

Advance 50,000 – 350,000

Recording 150,000 – 500,000

Video Production 300,000 – 2,500,000

Tour Support 50,000 – 150,000

Marketing and Promotion 400,000 – 1,400,000

Total 950,000 – 4,900,000

Fixed Costs

Investment per album cycle (in USD)

Advance 50,000 – 350,000

Recording 150,000 – 500,000

Video Production 300,000 – 2,500,000

Tour Support 50,000 – 150,000

Marketing and Promotion 400,000 – 1,400,000

Total 950,000 – 4,900,000

ROI in the Music Industry

1 - 3 - 6

Return on Investment

Weighted Average ROI: 28% to 51%

Flop• Between -61% and -65%

Success•Between 650% and 886%

Risk Mitigation – Piracy and Streaming

Piracy Prevention

Reduced Piracy

Window of Opportunity

Serial Copy Management

SystemAdditional upload

prevention

Summary – The Bottom Line

New Market High Margin ProductROI between 28% and

51%

Immersive Music: the future of the record industryPRESENTED TO COLUMBIA RECORDS

SAM KRAUSE, TAYLOR HEYWOOD, GREG SNYDER, TALAL BARAZI

Table of Contents – Appendices

1: Financials

2: Assumptions

3: ROI Calculations

4: Breakeven Calculations

5: Spotify Growth and Income

6: Pandora Growth and Income

7: The History of Virtual Reality

8: 360 Degree Filming

9: Photo Sources

Appendix One: Financials

New Artist Flop New Artist Success Superstar Flop Superstar SuccessTotal Investment 950,000$ 950,000$ 4,900,000$ 4,900,000$ Breakeven Units 39583 39583 204167 204167Breakeven Dollars 1,583,333$ 1,583,333$ 8,166,667$ 8,166,667$ Sales 25000 250000 125000 1000000Market Share 1% 6% 3% 24%Revenue 1,000,000$ 10,000,000$ 5,000,000$ 40,000,000$ Profit (583,333)$ 8,416,667$ (3,166,667)$ 31,833,333$ ROI -61% 886% -65% 650%

Appendix Two: Assumptions

Assumptions:Unit Price 40$ Packaging Cost (10.00)$ Royalty 15%Royalty Cost (6.00)$ Total Variable Cost (16)$ Unit Contribution 24$ Market Size 4,142,760

Appendix Three: ROI Calculations

Win ROI 650% 886%Lose ROI -372% -372%Sum ROI 278.02% 514.32%Wighted Avg 28% 51%

Appendix Four: Breakeven AnalysisTypical CD

•75,000 – 290,000

VR Album

•39,000 – 204,000

COD ELITE

•1,100,000

Appendix Five: Spotify Growth and Income

Appendix Six: Pandora Growth and Income

Appendix Seven: The History of Virtual Reality

The Idea The Failures