✖ Podcasts and music, it's not a fight!
And: Chartmetric's 6mo trend report; will we have a festival summer?; a virtual idol musical; how the Save Our Stages act came about; Yout vs RIAA
With all the news swirling around Amazon’s acquisition of Wondery and Citi downgrading Spotify’s stock to ‘sell’ status I had to think of a quote by David Byrne, from his wonderful book How Music Works:
“I like a good story, and I also like staring at the sea - do I have to choose between the two?”
Spotify
On the one hand we have Spotify, who started investing in podcasts back in 2019 with the acquisitions of Anchor and Gimlet. They have what they call an ‘audio-first’ strategy in order to become a fully-fledged audio platform that should pull listeners, and with them ad revenues, from traditional radio (hi Sonos Radio). A lot of people who listen to radio still prefer to listen to talk radio over music-focused channels. Focusing on podcasts next to, or over if you prefer, music Spotify aims to please exactly those people who are still anchored to their radio. Of course, the other side of this argument is that Spotify is only getting into podcasts to drive down the share of its revenues it has to pay music rightsholders.
Amazon, Apple, Tencent, and the rest
On the other hand we have Spotify’s competitors, such as Amazon, Apple, and Tencent, who are making their own moves into a kind of audio-first strategy. Apple is reportedly putting together a podcast subscription service. Tencent Music Entertainment’s acquisition of Lazy Audio, a platform for audiobooks, saw its share price jump up 21%. The last example showcases that investors, in general, are still bullish on consumers’ appetite for audio. And with all the big tech companies moving down the path Spotify has set out on, it’s a fair bet that audio and music will find a place right next to each other no matter which streaming service you use. And yet, Citi downgraded Spotify’s stock:
“The cadence of Premium gross additions (through 3Q20) and app download data (through 4Q20) do not show any material benefit from recent podcast investments (that began in 2019).”
The reason then, is that Citi expected a return on Spotify’s investments into podcasts in the form of an increase in subscribers and an increase in app usage. The latter metric hints at the the ad revenues drawn from users in Spotify’s free tier. It makes sense that without significant growth in either of those areas investors are starting to question how Spotify will grow its revenues. Its long-term growth plans may sound good, but need to be reflected in year-over-year growth metrics.
At this point, it’s interesting to look at Amazon, which, now together with Tencent, has the widest audio-first strategy of the major players. Before the Wondery acquisition, Amazon had already put podcasts in front of its current consumers through Amazon Music and Audible. With the latter, they also capture a large part of the audiobook market. It’s fair to ask where this leaves music and what its place is within an audio-first soundscape.
So where does this leave music?
In his opinion piece in Rolling Stone on the Wondery deal, Tim Ingham expresses concern that Amazon spent $300 million on a podcast company instead of Taylor Swift’s back catalogue, which of course got sold for that same figure. He sees this as evidence that streaming platforms are becoming more interested in audio, or the spoken word, than music. He ends the article by warning that in the future:
“music is a second-class citizen in the broader entertainment space.”
And yet, music never comes in first in terms of revenue streams when it comes to its sisters in the entertainment space. In terms of global revenues in 2019, music reached $20.2 billion, film’s box office revenues were $42.5 billion, and gaming dwarfed both with $145.7 billion in revenues.
Put it like that, and music is decidedly ‘second-class’ in the entertainment industry. It should be looking to expand its consumer pie not create a walled garden that people enter to only listen to music.
Time to look outside of the music and audio bubble
One way of expanding that pie is by looking at what is going on in other industries. Conrad Buck put it succinctly in his latest installment of The Bulletin:
“Service and consumer industries such as transport, travel and hospitality as well as healthcare and wellness or home improvement all are now playing a much larger role in how we interact with mobile devices, TV screens, smart speakers and smart home devices. The rise of home fitness is powering demand for large screen TVs (that have replaced the gym mirrors) and wearables, both of which then encompasses music, health statistics and interaction with the TV.”
Instead of worrying about podcasts and audio-first strategies cutting music’s pie down, we should be focusing on the opportunities brought by new users. Meanwhile, we need to look outside of the major streaming platforms and look at the broader entertainment industry for inspiration on how to connect with people through the devices they use and activities they undertake. Music is so important in most people’s lives that it can enhance any experience.
Maarten Walraven-Freeling
TECH
📊 Chartmetric released their 6-month trend report. In light of the above article, I’d like draw special attention to what they call ‘cross-platform performance,’ which is
“an artist's overall performance across eight music and social platforms relative to the performance of every artist in our database.”
The data shows wonderfully how music invades practically every we do and create online. If you like, you can also just go to the Airtable directly to see all the charts in action.
👩🚀 Bilibili hosted a virtual idol musical called Vox Ultima, it brought together 12 popular virtual idols and real-life stars set in an environment drawing on elements from cyberpunk to opera.
♨️ In what will surely be a big year in the mergers & acquisitions department, Live Nation has taken a majority stake in livestreaming platform Veeps. From the comments it looks like Live Nation will use livestreaming to complement live, to offer experiences not available to those inside a venue or access to those unable to attend in person.
🤠 TikTok is the hottest music-discovery platform right now. Synchtank has some great insights on why the platform works for both the brand new and the back catalogue.
🧑🏿⚖️ Stream-ripping service Yout filed a lawsuit against the Recording Industry Association of America last year. The latter has now moved to dismiss. There’s a lot of interesting bits and bobs into the workings of YouTube in there. If you’re keen, you can read the RIAA’s motion to dismiss and memorandum of law in full.
CORONA
⛺ Will we have a festival summer? It’s a question everyone seems to want an answer to. Hellfest, the French metal festival, has pleaded with the French culture minister to be clear about this. I’ve written before about the need to provide clear roadmaps in order to affect resilience. In an industry that has often postponed last year’s events, where punters have mostly held on to their tickets, it’s imperative we can come to terms with whether there will or there won’t be a festival summer.
📃 Pollstar looks back at how the Save Our Stages act came about, what its strengths are and where its weaknesses lie. The next steps are all about education and helping venues get access to grants.
🤝 A positive effect of the pandemic should be that because labels have not seen a big economic downturn they will deepen their partnerships with artists. Writing for MBW Pru Harris notes that especially independent labels have an important role to play in discovering and nurturing both artists and new audiences.
🎚️ I take a lot of heart from stories of how artists have adapted to the pandemic. The Chicago Reader has the stories of two musicians, Tim Daisy and Matt Piet, which goes deep into how they changed their recording set ups, habits, and the way they collaborate.
☄️ The National Sawdust in Brooklyn, NY hosts a Digital Discovery Festival. It’s all about new music, as you would expect. This is one of the places I’ll be looking to for how to develop performances for virtual stages. All of the performances are 10-minutes long and the line-up is made up of young composers and choreographers who identity as women, trans, or non-binary.
Music
I’ve been drawn into the music of Divide and Dissolve recently. They make music to destroy white supremacy and stake a place for their ancestral roots. It’s a wonderfully excruciating trip to listen to their sound. Here’s a good place to start if you’re curious about their combination of metal and jazz.
✖ MUSIC x, founded by Bas Grasmayer and co-edited by Maarten Walraven.
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