✘ Shaping markets and network value

And: Creating alongside expectation; A tidal wave of sexual abuse cases; Close the app, make the ting; Culture is the client

Over the past few weeks, you’ve read thoughtful, insightful, and instructive articles here in collaboration with MUTEK Festival and Forum. From these articles, it’s clear that new technologies can provide freedom to both artist and listener. There’s levels of creativity being unlocked almost every day. At the same time, we need to step back and think about what we’re asking of the artists who we expect to push this all forward.

Artists shape markets

The future is uncertain and the system we operate in is complex. We know this, and yet we don’t tend to act productively towards that knowledge. So much in our industry is focused on short-term goals – from breaking new artists to getting that VC bag. However, it’s actually not platforms, labels, or start-ups who shape markets – it’s artists. They are the first movers, it’s their creative expressions that help founders find their niche and platforms find product-market-fit. To accept this, means to rethink our approach to those markets. In the spirit of Mariana Mazzucato’s mission thinking, let’s see if we can work towards what she calls predistribution of value. For her, this is about equity and public good being built into a project from the start. When we think about new technologies, this is often not the case. For musicians, this is already different – their creations come from a different place. And yet, we expect them to be little businesses where they play CEO as well chief creator. The radical step that predistribution of value lets us make is to consider revenues outside of the simple economic settings that we’re used to, such as our own home finances.

Network value

Revenue is more than money in, but it’s difficult to place value on the part that is more. Going back to Mazzucato, she urges governments to take more risks in their approach to economic markets. Instead of the government as market-fixer, she wants governments to be market-shapers. An example she uses is how Tesla received a massive loan from the American government, without which we probably wouldn’t have seen all those electric cars from them. What they didn’t do, however, was accept a percentage of the company for that loan. To be fair to Tesla, they tried to treat the US government as a regular VC investor, but the government declined. If they wouldn’t have declined, they would have been able to recoup that investment – and then some.

This story helps illustrate how a government creates more value than simply a return on investment. The Tesla investment has helped shape an entire market. Instead of seeing that risk and accepting it, governments don’t think that way and. They see a problem – climate change – and a solution – electric cars – which can be deemed a public good, but which people don’t want to pay for yet. The loan to Tesla, then, was a solution to that market failure on the demand side. It’s not that difficult to then think about that as opportunity to shape that market instead. But that would mean provided direction, and that’s not something that most governments dare do.

Direction is required from entrepreneurs and businesses. But, especially in music, also from artists. It’s often the latter who provide the direction that builders solve for. In that, they create heaps of value, which they often see no return on. A reason for that is because that’s all network value and that’s difficult to put hard numbers on.

Accepting failure has consequences

How often haven’t you heard that we need to fail more, and fail better. This is okay for people with a start-up, because they can pick up and go again. It’s much harder to take the acceptance of failure to the artists, who have no safety nets or even an Angel or VC fund to draw on in the first place. Besides not being able to put hard value on the network effect that musicians create when using new technologies, they also mostly move without safety nets (and here we shouldn’t discount that most safety nets for young artists are actually family).

Safety nets can come in two main forms. First, there’s the institutional support that artists require when engaging with new technologies. It’s festival like MUTEK that offer such support, and do so in a holistic way. This kind of thinking seeps through our industry more and more, thankfully. Just look at music competitions, where all participants now regularly get support instead of just the finalists. We need more of this, however. In countries that are built on government funding structures – think Canada or most countries in Europe – the government has a strong role here. So much of their economic thinking, unfortunately, doesn’t follow that of Mazzucato. Instead, cultural funding is often placed against hard economic results. So running an orchestra costs more than it generates in revenues. But what if we take into account the network value of that orchestra? And what if we take that type of thinking to an independent artist?

Especially those indie artists, they usually only fail once. After that, they get a job and start making music on the side in their bedroom. What if we can ascribe network value to what these artists create? Can we then find a way towards more long-term thinking? Failure is only useful if those who fail then have the time to get back up and start again. This requires a different approach to funding – let’s call it patient finance. The idea here is to get artists to fail using new technologies and providing a safety net for them to do so. The investment this needs won’t have a regular ROI, instead it will be measured in the network value – the value created along the way. This can be measured by other uses of technologies that come to light. Think about AR and XR, for example. When you let musicians experiment with those tools, there’s no telling in advance what they’ll do with it. What we do know is that new use cases will be created. Same with AI – as we’ve seen in MUSIC x in some of the MUTEK take-over articles – artists will push forward the technology and create markets for it.

Making the economy you create work for artistic goals

While this article started with the idea that we need to find institutional support to allow artists to explore and experiment with new technologies, it has turned towards a much bigger argument. In doing those experiments, artists create and give direction to new economies. While their work in this is rarely measured, this line of thinking lets us rejig the relation between artists and the economic markets they operate in. Instead of looking at those markets as various forms of revenue models, we can think about them as drivers towards artistic goals. That way, the goal is for the artist to create, not, for example, for a platform to generate income.

At the start of this series I asked the question: “What are the visions we need to help create the practical infrastructure required to create sustainable artistic worlds?” The answer is less a vision, and more a new type of economic market that focuses on network value, created together and along a variety of initiatives. All of a sudden, the music industry becomes something that we tackle together.

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👩🏿‍🎓 Water & Music x Music Tomorrow - Academy on data-driven music strategies and tactics

Today, it’s hard to find a job in music that doesn’t involve working with data. Strategy, analytics, and operational proficiency around music data are quickly becoming integral components of the modern music-industry skill set — especially in the context of cutting through the noise and making sure music gets heard by the right people, at the right time.

At the same time, in the face of stubborn data fragmentation, shortening viral hype cycles, and new consumption channels popping up on a weekly basis, marketing remains one of the most difficult functions of the music business to get right. By the end of this course, you’ll have the deep industry context, case studies, and tactics you need to integrate data into your music marketing in a smarter way, no matter what vertical of the music business you work in.

The schedule

• Tues October 3 — Introduction: Survey of industry data practices with Julie Knibbe, Cherie Hu, & Maarten Walraven

• Thurs October 5 — Setting targets and benchmarks with Christine Osazuwa & Julie Knibbe

• Tues October 10 — Developing your marketing plan with Maria Gironas & Dani Chavez

• Thurs October 12 — Building a bulletproof fan CRM with Alec Ellin & Luna Cohen-Solal

• Tues October 17 — Marketing automation with Alex Brees & Kristin Grant

• Thurs October 19 — Discoverability: Introduction to recommendation systems with David Hesmondhalgh & Sidney Madison Prescott

• Tues October 24 — How to boost digital discoverability with Dmitry Pastukhov, Gene Avery Hogsett & Chuka Chase

• Thurs October 26 — Closing remarks: New digital frontiers with Robin Shaw & Tina Rubin

Sign up here, but email me for a discount code first.

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LINKS

🥁 Creating alongside expectation (Sound of Fractures)

“Projects like mine (Scenes) are experiments that set out to find answers when we don’t even know what the questions are. They are exploratory, they are heading out into the unknown, by their nature they need to sit in the grey area. It's exciting and important but often exhausting and lonely experience.. but at the other end we might find new concepts, new products, new approaches or new markets… or just have fun on the way and enjoy the journey.”

✘ It’s almost a companion piece to my article above, showcasing the difficulties an artist faces when they want to create something new and has to create new forms and shapes to fit that in to. At the same, they have to make people understand that have their own models they try to fit stuff in.

🛑 Annie Mac says the music industry has a “tidal wave” of sexual abuse cases (Becky Buckle)

"There are common threads that run through everything I've heard. That is that women, especially young women in the music industry, are consistently underestimated and undermined, and freelance women are consistently put in situations where they are unsafe.”

Annie Mac

✘ There’s so much that still needs to come out, and so many men who will fall hard on their swords. I cannot wait for it.

🟨 Close The App, Make The Ting": Elijah's Yellow Squares are making a difference by cutting through the noise (Billy Ward)

“A London-based DJ, artist manager, and co-founder of the iconic record label, Butterz, the prolific figure writes daily on sustainable artistic creation, electronic music, grime and rap, web3, community, social media, and his other curiosities in short notes, known as the ‘Yellow Squares’ on Instagram and Twitter. The format is simple but effective: For step one, he uses his iPad and Apple Pen to write out his industry-related thoughts on a yellow background. For step two, he uploads them onto the internet. The simplicity of these short form statements has quickly resulted in a wave of highly-shareable, conversation-sparking content, achieving viral recognition across social media over the last year.”

✘ This is all so cool. Great artist does his thing - authentically - and finds a form of success. Meanwhile, there’s awesome music and lots of great initiatives.

🚨 Culture is the client (Nick Susi)

“Tapping into culture needs to be more than, how do I make my brand cool? Cultural strategy is the act of understanding, contextualizing and applying cultural knowledge to achieve an intended outcome or change, in a way that respects, benefits and sustains the culture of origin. The last bit is arguably the most important aspect, yet unfortunately, the most overlooked.”

✘ I just want everyone to read this. It’s such an important mindset to have and links back to the article above too. The big questions are around whether we can escape becoming exploitative when seeing culture. The answer is yes, if we make the effort to reach out and make real connections. It’s all about collective creation and putting financial value back into a culture.

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MUSIC

I’ve been seriously enjoying the curation of Opium Hum in his Telegram channel Hyper Real Radio. It bounces all over the place from techno to cumbia and from EBM to Javanese folk trance. Now, he’s also started a podcast where he highlights DJs he loves. The first one is a marvel of electro with various infusions of other genres with Dagga.