Our changing relationship with music and its new practical function

back in my day music players

Music executives need to understand how shifting context and function have changed music consumers and their expectations.

Guest contribution by Thiago R. Pinto.
Portuguese version.

Part I

So, the music industry has changed. If you haven’t been living in a cave for the past 15 years you probably noticed. For those who need to catch up, here are the 3 main points that summarize it:

  • increased access to the means of production;
  • increased access to information;
  • democratization of distribution channels.

But some things remain unchanged by this digital revolution. Royalties distribution, for example. The correct distribution of copyright royalties is still a headache for composers, musicians and labels. Despite music having been practically dematerialised and living on networks where everything is trackable. Companies like Kobalt are trying to change this game, but we still have a long way to go until we get this right. This is an issue that deserves its own article, so I’ll leave it for now.

Among the lasting habits that have been practically untouched along these 15 years, my personal highlight goes to a mantra I hear in every conference, article and talk about music. It goes something like this: people’s emotional/behavioural relationship with music hasn’t changed. We still love music the way we always did.

Part II

A couple of weeks ago I was reading a report published by Vevo where in its introduction Erick Huggers, Vevo’s CEO, once again repeats the mantra:

vevo report

Well, I don’t know where Huggers and others are looking, but I can’t believe that they still don’t see something that it’s in everyone’s face. This relationship has changed! C-H-A-N-G-E-D. I would write it upside down if I could.

Before we move on with the subject, I just want to make one thing clear: yes, music still moves crowds of people. Yes, it is more listened than ever. And yes, artists still have a lot of influence. However that doesn’t mean people still relate to music the same way they used to.

Probably there is no other cultural activity that is so universal, that permeates, affects and shapes human behaviour as much as music, said Alan P. Merriam in The Anthropology of Music. However, music’s own definition evokes a variety of philosophical, cultural and even political questions. Musicologists suggest that its definition is directly related to the social context and function of certain behaviours in a particular culture. In my opinion, these two words — context and function — define a fundamental element, so many times forgotten, of the discussion: the formation of our musical preferences.

The changes in the way we build our tastes and preferences are the things that should be analyzed, so that we can understand why today music has a new function and also why we can no longer blindly support ourselves on arguments like the one above by Huggers, especially if it is presented in an music industry context. To understand context, function and how today these issues have altered people’s relationship with music, we must go back in time.

Part III

Music always had context and function. In the early days, when we were still just tribes, music used to have spiritual functions. Variety didn’t exist, neither was music entertainment. One’s tribe music was all that there was to listen to and it was directly related to celebration of the tribe’s beliefs. In other words, music was attached to religion. In this context, forget about music preference. People will listen to what the Chief says.

We evolved into more complex societies where we began to be divided into social classes. There were the nobles, the bourgeois, and the clergy. Then came everyone else. At this time the culture each one of these groups had access to, was a fundamental tool for social distinction. For the rich there were good instruments, good musicians, and concert halls. There was classical music. For the rest there were rudimentary instruments, self-taught musicians and taverns. There was folk music. In that context, musical preference was a status symbol and it showed to which social class one belonged.

2 hippies at a festival
Music had a fundamental roll in the formation of the hippie culture, being a tool for the creation of a collective identity.

During the 20th century the development of consumer societies gave new meaning to all goods produced. Especially after World War II, we started living in a society where for the first time supply was greater than demand. At this point there were a great number of companies offering very similar products and services. The technical differentiation between these goods gave space to brand personality construction and so we began consuming products not only for their quality but also because we identify with them. We started to use consumption as a way to build individual and collective identities.

In this process, cultural goods — specially music — were extremely important. Musical preference was a key element in defining ones personality, particularly among the youth. It was what defined which group a person belonged to, which ideology he or she followed, and in what values he or she believed in, independent of what was his or hers social-economical background. In that context, music preference was about identity.

Part IV

We arrived at the beginning of the 21st century and all these functions — spiritual, social and identity building — still exist. The difference is that now they’ve lost strength and no longer are the pillars that define our musical preference. The 3 key elements of the digital revolution (access to the means of production, access to information and democratization of distribution channels) created a new context to music consumption having a direct impact in the way new generations are building their musical preferences.

Never before in history have we had access to so much music, for such a low cost and at such a high speed. The access difficulty, which in my opinion was a key element in keeping our preferences so narrow, was eliminated from the equation. At 15 (in 1998) I had a proud collection of roughly 100 CDs as a result of the musical choices I made. Today a teenager with the same age has access to humanity’s music library only a few clicks away.

Part V

The platforms in which we consume music have also changed. The introduction of the iPod started transforming music consumption into a private experience which allowed people to try out new music genres without worrying about their social image.

Listening to music on the metro
Music consumption habits were strongly impacted by the introduction of digital portable devices and headphones.

Through the ease of access and popularization of new platforms, music started being ubiquitous. The frontiers to experimentation were then opened and brought new tastes and the permission for listeners to break up the social identity chains of each genre allowing the free flow between a variety of different styles of music. It was the beginning of the process that freed music from its function as an identity building tool. At this point a new function for music emerges: the practical function.

Part VI

Music started to be used according to the activities and tasks that listeners were performing during their daily routines. Like this, music preference that before was an almost immutable passion built through context, today looks like a chameleon changing from moment to moment.

We are living the age of “I love this music, but at the right moment”, we see the creation of a generation of eclectics that use music in very practical ways, a generation where the mood related to an activity is more important than genre. Need to study? Downtempo or classical. Going to the gym? EDM or hip-hop. Time for cooking? Indie folk or jazz. Going to a party? Techno or trap. In other words, the experience is not in the music itself, but in what we do while while listening to it. In this context it is interesting to realize how we can look at today’s music services with new eyes. Last.fm is a great example.

Last.fm was one of the first social networks to use music to establish connections between users based on their music preferences. It identifies all tracks and the related artists played by its users and utilizes this data to build a personal music history. The initial goal was that from this list of most played artists the user’s musical preferences would arouse. If a person listens to Beethoven, Mozart and Bach a lot then classical music must be his or her preference.

But following the aforementioned argument, that music today has a practical function in people’s life, we can not accept this conclusion so fast. Classical music today is consumed a lot by people while they work and, in this case, we have to also consider that classical may not be their preference, but just the genre that follows her main daily activity: work. If the tasks we perform during the day are what are going to define what we will listen, and not our musical preference for a specific genre, than we can say that today, Last.fm does not present the musical preferences of its users, but a list of the activities they engage the most in.

While in Last.fm’s case we can consider that this data is generated “accidentally” as a service sub product, to Spotify the perception of the new practical function of music was fundamental to the development of its UX.

Spotify was one of the first major services to understand that to this new generation of listeners, the stars of streaming services are not songs and artists, but playlists and moods. Spotify’s user experience is built around these two elements, because the company understood that its users do not solely use the service for contemplation, but use music as a fuel for another activity. It was the first time I saw a service put together moods and genres side by side, presenting a perfect mirror for this profound change in music consumption behaviour.

By focusing on moods and playlists, Spotify helps its users to quickly find a perfect selection of music to whatever activity he or she is engaging in, without having the headache of searching through 30 million songs to find the perfect ones for the moment.

Spotify workout playlists

Spotify mood playlists
Spotify and its long list of mood and activity playlists.

Part VII

Now that we‘ve gone through the new practical function of music, how it changed the formation of our musical preferences, how it changed our relationship with music and finally how we can have a new look on services and business strategies, I want to go back to the focal point to this article which is the mantra “we still love music the same way we always did”. I’ll once again quote Vevo’s CEO Erick Huggers to present my counterpoints:

“Music creates transformative experiences. It has the power to connect people in personal and meaningful ways unlike any other medium.”

No, it is not music that creates the experience. Music is the background that helps to set the mood. The activity which people are engaging in is what connects people (with themselves or others). It is the Saturday lunch with friends, the picnic at the park, the music festival with 40.000 people in the middle of the desert.

“For music fans, it’s an essential part of how they live their day-to-day lives.”

I believe this statement is true only if we understand that music is an essential part of this new generation of listeners, because it gives the key to the activities they will engage in and not because — like in the past — it was used to build their personal and collective identities.

“Finding the songs and melodies that speak to them directly and reflect their unique personas isn’t so much a desire, but a need.”

Global Spotify Listener Loyalty by Genre
A Spotify chart presenting the most loyal fans by music genre. Knowing a little bit about metal it‘s obvious that its fans are the most loyal ones. What’s important to notice is how all the other genres are pretty even, showing that people are not attached to them.

Here is the big issue. Music for new generations is not about reflecting their unique personas, but a mirror of the activity he or she is performing. Music was once a question of loyalty and identity. Today it’s a good consumed according to moments. So the musical preferences of these listeners is much more flexible and no longer the reflection of their identities.

Part VIII

Whether this new perspective is something bad or good for music is not up to me (or especially to this article) to say. What is important here is that this revolution cannot be stopped. It is a continuous process of gradual transformation where the individual is in charge. It is a self regulating revolution where it is not up to industries and businesses to control it, but to really understand its culture, values, rules and players. We should not perceive this new listener from a conservative viewpoint or as an enemy to the music establishment. We should analyze it from an evolutionary standpoint where the listener is the transformation agent in a radical change in the social consumption relations.

Futurism is a science that usually gets its predictions wrong because it is done in large by people who look at technology and numbers (and because it is just damn hard to see what’s coming). Technology can change people’s behaviour, but only if it is the right time for it, in the right context. Numbers can sometimes be misleading. If you only look at the big numbers you might miss the small ones which are the real indicators of transformation. The real challenge in futurism is to predict how our behaviour is going to change. Borrowing from Tom Vanderbilt’s excellent article:

“When technology changes people, it is often not in the ways one might expect.”

Technology changed the way we listen to music and as a result we changed the way we feel about it. We should start considering that people are no longer loving music, but that they just like it. Or are even just using it. But what is more important is that only when we understand these changes, will the music industry be able to create services, products and business models that are in tune with this new listener.


This is a guest contribution by Thiago R. Pinto

Use Facebook Messenger to Access Spotify Discover Weekly and Release Radar – in 4 Steps

A bot for Facebook Messenger lets you access your Spotify Release Radar and Discover Weekly playlists from inside Messenger. Since it currently lacks an interface, here are the steps to follow to get new music recommendations delivered to Messenger.

Discover Messenger

1. Add the bot

You can add the bot by clicking this link.

2. Sign in

Tell it you want to sign in, by typing sign in. Then login to Spotify & give the bot the necessary permissions.

3. Play something

You can now choose to play tracks on Spotify or get 30 second previews.

4. Extra commands

Got lost and want to bring back the playlist? Type current week. You’ll also be able to tell it playlist 1 week ago to get last week’s playlist, but first you’ll need to be using the bot for a while.


At the time of writing, there are still some bugs to iron out. If you run into any difficulties, you can contact the bot’s maker, Daniel Noshkin, on Twitter or on Product Hunt.

If you ever want to revoke the app’s access, you can find all apps that have access to your Spotify account in your settings.

Spotify’s strategy to become a habit-forming product

Last Friday, Spotify unveiled its newest feature: Release Radar – a personalized playlist of newly released music, updated every Friday. It’s reminiscent of Discover Weekly, but Release Radar’s recommendations are always newer tracks. My first impression is that it’s much more likely to recommend music from artists you’re already familiar with.

As Spotify keeps rolling out features like this, and competitors no doubt follow suit, the implications for the music business will be significant. Matt Ogle, who’s behind both of these playlists, revealed last March:

There are 2,000 artists for whom Discover Weekly is currently 80% of their streams, and something like five or six thousand for whom Discover Weekly is half of their streams.

But I’d like to zero in on Spotify’s product strategy and why features like Discover Weekly and Release Radar are so important for the service. It has everything to do with the power of habit.

Habit Loop Spotify

Discover Weekly creates a perfect habit loop. The routine is listening to your refreshed playlist. The reward is the release of good hormones due to interesting new finds, and perhaps the social currency of sharing. The cue, or trigger, is simply the fact that it’s Monday and the start of a new week.

On Sunday, another habit loop is triggered. To prevent losing newly discovered gems, users log on to save tracks from Discover Weekly to their playlists. Loss prevention is one of the strongest motivators.

Spotify Discover Weekly Habit chart

Spotify’s bet is that they can create another habit, focused on different days of the week, by releasing a new feature in the style of Discover Weekly. Being able to consistently drive traffic back to your product is great if you’re ad-supported, might help to convince free users to upgrade to premium, and helps premium users justify the recurring cost of their subscription.

Now, instead of 2, there will be 4 cues.

Spotify Discover Weekly + Release Radar chart

Friday is a great day for Release Radar for two reasons:

  1. Easy to remember: it’s the last day of the week and people have the weekend on their minds.
  2. Since last year, Friday is the global release day for new music.

Here are two hacks I made that bring some cool additional automation to the new Release Radar playlist:

Curious how Release Radar works? The wonderful folks at Hydric Media, who are behind the hit music app Wonder, created a free tool called Playground, which opens up all the different parameters of Spotify’s Echo Nest API powering the Discover Weekly and Release Radar playlists.

How has your Release Radar experience been? I’ll show you mine, if you show me yours. Send me a tweet: @basgras.

The Global Implications of VKontakte’s New Music Licenses

Last week’s most important music business news could well be the deal struck between Russian social network VKontakte (VK), and all 3 major labels. It follows a long history of conflict between VK, sometimes referred to as Russia’s Facebook, and the music industry. It seems like the music will stay freely available to VK users, and the service will start testing various monetisation models through new functionality aimed at its music listeners.

Two major implications of this deal:

  1. VK was like a Napster meets Facebook. Anyone could upload music (and other types of media) to it and anyone else could retrieve and access that music. For free. Now, suddenly, this behaviour has become monetized.
  2. There is a global ecosystem of unlicensed music apps that rely on VK’s huge music database to source their content. I assume the majors were not willing to license that, so we should start seeing some of these apps struggle to maintain catalogue.

In Russia, music is social

To understand the significance locally, you should know a couple of things about Russia’s online music landscape. Due to the presence of basically every song you can think of on the country’s most popular social network, people have grown up consuming music inside a social layer. This has made the online music landscape in Russia inherently more social than in many other countries.

Facebook has Pages, VK has communities

A few years ago, the battle between VK and the music industry looked more like a war. It was threatening to destroy an important pillar in Russia’s live music business: the VK communities centered around music.

Moderators of these communities regularly post music to the groups, so for many of the groups’ followers it’s a way to get fresh playlists, find new songs, or connect to familiar tunes. There are groups for well-known superstars, like Drake, for local pop singers, like Dima Bilan, but also for lesser-known niche artist like the Dutch producer Boaz, who has worked with artists ranging from Major Lazer to Yellow Claw and has largely remained in the background.

When promoters are organising shows, they reach out to communities like these to connect to audiences of tens of thousands of people. Sometimes they pay moderators to promote a show, or just offer some free tickets. These communities have been instrumental in driving audiences to shows in Russia & other CIS countries. The fact that these groups can now survive is a big win for VK and the wider music business. Not only do they drive audiences to shows; they also provide valuable data that helps to identify tastemakers & influencers, and potential hits.

What should VK do next?

The presence of a vast music and video catalogue on VK has given it a good competitive advantage over Facebook. VK is the 3rd most popular site in Russia, way ahead of Facebook, which is number 8. It trails Yandex, Russia’s Google, which is reportedly discussing a partnership with Facebook.

VK must leverage its unique advantage to stay ahead of Facebook, and offer a unique, competing experience, that could also appeal to users outside of Russia. These users would already be locked into the Facebook ecosystem and will thus not be interested in joining VK as just another social network. Even if they would be, it’s unlikely VK as a classic social network can attain the critical mass it needs in new, Facebook-dominated markets.

Another threat is the rise of messengers including Telegram, which was founded by Pavel Durov, who also founded VK, but parted on complicated terms. Messengers have been an expected threat to social networks for years, which is why Facebook spent $21.8 Billion on acquiring WhatsApp and offered $3 Billion for Snapchat in 2013. More recently, Facebook has invested heavily in Messenger, launching a bot platform in April this year, which is now host to over 11,000 bots, like the DJ Hardwell bot.

VK is not well-equipped to compete with messengers, yet, and should start making efforts to maintain relevance in a mobile-first landscape, which in emerging economies may also mean mobile-only for big parts of its audience.

This means 3 things:
  1. VK is in dire need of a clear, focused mobile strategy;
  2. VK can use its licensed music & media offering as a competitive advantage;
  3. VK should consider unbundling in similar vein to what Facebook has done with Messenger, Instagram and WhatsApp, so that they can make products that will appeal to Facebook users, too.

Sidenote: VK is partly owned by Mail.ru, which also owns Russia’s second most popular social network Odnoklassniki. Both are included in this licensing deal. The latter has an older user base, so VK will have to target demographics below 35 years old.

Monetization

With all major licensed music services reporting losses, it’s unlikely that music on its own will be profitable for VK. It should consider it a loss lead for the foreseeable future and use it to strengthen its market position. This is not to say they shouldn’t start experimenting with monetization, they definitely should.

Key strategic points for VK:

  1. Stay away from subscription models for now – it is really complicated to convince people to start paying for something they’re used to getting for free. It’s something big parts of the music industry have struggled with for decades now – don’t let this thinking infect your business model.
  2. Carefully study the social data behind VK music communities – what drives interaction, what makes things go viral, what excites people, etc. VK, like Facebook, is in the ads business. These factors are not just crucial for developing new products, but also for their core business model.
  3. Focus on building a new social product for mobile that would fare well in today’s messenger landscape. One of its most important ingredients should be music.
  4. Add mictrotransactions. It’s the easiest way to get people to pay for digital goods in emerging markets. People are not used to recurring subscriptions, many people have pay-as-you-go mobile plans, and microtransactions play nice with mobile wallets, which reduces friction around payments.
  5. Do NOT connect the microtransactions directly to music. Get people to pay for things other than music, but use the music to drive those purchases. For example, imagine if musical.ly were to charge users for video filters. Creating the association of paying for music will kill your business before starting. First, let people get used to making payments around music. VK already has experience in selling virtual goods, like avatars, virtual flowers, etc.

I believe microtransactions, in VK’s case, are more likely to bring repeat revenue from users, at a larger scale, than subscriptions can. If they must do subscription — offer new functionality instead of pay-gating what users already had for free. Make it different from established players like Zvooq or Yandex.Music, or from Spotify which tried to launch in Russia and then withdrew. Bear in mind Soundcloud’s and YouTube’s difficulties in converting free users to subscribers. It’s notoriously difficult to convert users from unlimited free to paid. Price for impulse decisions, so people pay before doing the math that they can do workarounds to get the music they want without paying.

VK, now licensed, is probably the largest social music service. Where music services have always struggled to create a functional social layer, VK has managed to blend music and social networking seamlessly. It will be interesting to see what’s next.


Written for my weekly newsletter MUSIC x TECH x FUTURE. If you enjoyed reading this, please consider sharing and subscribing — it’s of great help.

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Are pay-per-stream royalties costing artists tens of thousands of dollars?

Is it fair that a 50-second song costs the same as a 20-minute composition? Back in the days of album-driven sales, track length didn’t matter much. If an album contains 50 tracks of 1 minute each (punk, grindcore), it would sell for roughly same price as an album with 3 tracks lasting 20 minutes each (post-rock, ambient).

Streaming services have changed this. Payouts occur on a per-stream basis. All songs treated equally. This means that if the amount paid per-stream is something like $0.005, Godspeed You! Black Emperor would make just 2 cents every time someone listens to Lift Your Skinny Fists Like Antennas to Heaven (runtime: 1h27m).

Royalty rates are variable and depend on total revenue vs total amount of plays. Spotify uses this formula:

spotify royalty formula

I took a look at Spotify’s top 50, since they publicly communicate the number of playbacks. Assuming a pay-per-stream rate of $0.005, which may differ from reality, I summed the total plays to understand the volume of the royalty pool and the cut each track would take. Then I took into account track lengths and compared the two. The difference for Spotify’s top hits runs into tens of thousands of dollars — per song.

streaming seconds winners

streaming seconds losers

If charts were based on time spent per song, rather than total number of plays per song, here are the biggest risers:

  • Drake “Controlla” (24 → 15)
  • Nick Jonas “Close” (32 → 23)
  • G-Eazy “Me, Myself & I” (35 → 26)

And the biggest fallers:

  • Mike Perry “The Ocean” (27 → 36)
  • Shawn Mendes “Treat You Better” (16 → 25)
  • Major Lazer “Light It Up (Remix)” (15 → 31)

Changes in accounting make a multi-million dollar difference

The top of Spotify’s global chart is not the most important area in terms of implications. The implications are greatest for artists and labels who produce music in genres that are structurally paid less per minute than other genres.

Spotify currently claims to have 100 million monthly active users. 30% of which are subscribers. They’re adding 1.8 million users per month. 80% of Spotify users use it multiple times a week, 25% use Spotify more than 20 days per month. It likely serves over a billion streams daily. Apple Music has13 million paying subscribers. Other services hold millions more of users. All streaming hours and hours of music each month. According to the IFPI, streaming revenues amounted to $2.9 billion in 2015.

Massive pies are being built that need to be split fairly. Music industry analyst Mark Mulligan recently uncovered that indie music’s global market share is closer to 38% rather than the 20% conventionally believed and added:

“This matters not for bragging rights but because in the digital marketplace, market share shapes the deals that are struck, with more market share translating into better terms. So a more accurate measure of share can help the independent sector compete on fairer terms.”

Debates need to occur about market share, pay-per-stream versus time-based royalties, and the way subscription payments are divided. Streaming services are not the ultimate deciders in this: they’re locked into pay-per-stream royalties with the industry through contracts with differing renewal or extension cycles. Therefore, these changes need wide coalitions to occur. It would also help to have a truly competitive music streaming market that nurtures models beyond the typical $10/month all-you-can-eat services.

Streaming is here to stay. It’s a necessary layer for a healthy music landscape. In this landscape, it’s currently very difficult for artists to practice autonomy over the pricing of their music. Two $20 albums of equal length receive completely different payments for the same amount of plays if their track counts differ.

Is that fair?

streaming rates table


Disclaimer: the royalty rate used in this article is based on an assumption and taken from a Billboard article dating back a year. In reality, royalties are slightly more complex eg. through subscribers’ streams counting heavier than ad-supported users’. Any total numbers resulting from using this assumption are therefore completely fictional.

However, even fictional numbers are useful in debating this. Whether the exact number per specific track is smaller or greater doesn’t matter. We’re still talking about how billions of dollars are distributed each year.

Hat tip to Cherie Hu for early feedback and sharing some data points.

Top image: Ocean of Sorrow, a work by Javad Alizadeh (CC/BY/SA).


Written for my weekly newsletter MUSIC x TECH x FUTURE. If you enjoyed reading this, please consider sharing and subscribing.

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