Tag Archives: music streaming

Why Spotify Discover Weekly Is The Best Music Curation Tool?

Apple Music arrived with big bang. Its approach to music streaming is surprisingly old school. It relies a lot on human curation and its programming resembles old radio (some of the shows are definitely worth listening though). It´s biggest rival Spotify is relying more on big data. At the moment it seems that latter approach seems to be the winning formula. Eventually recommendation engines will become a core differentiator (as the libraries will become quite identical) for streaming services, so the headstart Spotify has is not insignificant.

Human curation was the way taste making happened back in the day. I used to rely almost totally to Dj Anonymous on my music recommendations. Best dj´s in the world have much more refined taste than any machine yet. The challenge with human curation is that it does not scale.

The recommendation engines were not really been yet up to task because the algorithms have not been advanced enough to recommend right songs. Music is nuanced thing and linear recommendation is not usually providing satisfying listening. Previous Spotify recommendations have been borderline ridiculous:

Prince Spotify

Previously there has not also been enough data available. For recommendation engines to work, you need to have massive amounts of data and something that is relevant. The key for Discover Weekly to work so well is that Spotify realized that the data they should be mining are the playlists people are making.

“For all the special sauce and the algorithmic work, the fact that we’ve kept it simple and that it’s just a playlist has really helped it resonate with people”
Matthew Ogle (Discover Weekly Product Owner)

The more people are making playlists in Spotify more “human curation big data” they are gathering. Currently there are over 2 billion playlists in Spotify. Spotify has been able to strike the right balance on learning about your listening habits and combining that with the big data:

“On one side, we’ve built a model of all the music we know about, that is powered by all the curatorial actions of people on Spotify adding to playlists. On the other side, we have our impression of what your music taste is. Every Monday morning, we take these two things, do a little magic filtering, and try to find things that other users have been playlisting around the music you’ve been jamming on, but that we think are either brand new to you or relatively new.”
-Matthew Ogle (Discover Weekly Product Owner)

In the beginning I wasn´t that impressed with Spotify´s weekly recommendations. Majority of the songs I knew already (20+ years of record collecting has its handicaps). After couple of weeks I started to appreciate the brilliance of it. Spotify Discover Weekly has become my “comfort playlist”. It plays stuff I know, but drops every week couple of nice gems I had not heard or had totally forgotten. During working week I listen to lots of weird stuff outside my usual taste profile, Spotify´s weekly recommendations don´t seem to pick on those anomalies and the quality is constant:

Like mentioned earlier, eventually data will trump human experience. In many fields, we are already there.

“In the next generation of software, machine learning won’t just be an add-on that improves performance a few percentage points; it will really replace traditional approaches.

Today, you’re much better off building a smart system that can learn from the real world – what actual listeners are most likely to like next – and help you predict who and where the next Adele might be.”
Eric Schmidt, Alphabet executive chairman

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Streaming Services Are The Last Hope of Music Industry

Last week Taylor Swift has been applauded as a crusader of music rights as she withdraw her album from Spotify:

“[People] can still listen to my music if they get it on iTunes. I’m always up for trying something. And I tried it and I didn’t like the way it felt. I think there should be an inherent value placed on art. I didn’t see that happening, perception-wise, when I put my music on Spotify. Everybody’s complaining about how music sales are shrinking, but nobody’s changing the way they’re doing things. They keep running towards streaming, which is, for the most part, what has been shrinking the numbers of paid album sales”

Taylor Swift´s comment is just a hypocrite sugarcoating of a smart business move and a great marketing stunt. She is still able make a platinum-selling album (the only one this year for that matter), so she concentrated on maximizing the physical sales. She would have left her albums in Spotify, if they had paid her more through premium service. She is smart businesswoman, so she definitely did the right thing for herself (proven by those platinum sales). It is not clear though, would she make even more money if she would have left her album in Spotify?

The last point of the quote is however just pure stupidity. Paid album sales have been shrinking way before no one had ever imagined music streaming. Streaming services kill downloads (both legal & illegal), because downloads are inferior format. Music streaming has been a truly a blessing for music industry. I might listen the new Taylor Swift album once on Spotify because all the publicity. She would get something out of that listening, but more than from me not listening that album or using BitTorrent. I would not buy or even illegally download that album in any case, because I am not that interested. Big stars benefit more from lurker listeners than smaller artists.

Essentially there is only one important thing to really understand about current music industry:

People will not be paying for physical music anymore. Period.

This is called progress and you cannot stop it. Taylor Swift is an outlier with her platinum sales. Increase of vinyl record sales is just a too well covered hipster activity. You have to be a total moron to think that vinyl sales could help even slightly the struggling music industry. The real question is: are people willing to pay for streaming services? They are the last resort to make any money from the actual songs. Currently it seems positive and with the launch YouTube Music Key, there is enough competition to keep it interesting for the near future.

It is naturally disheartening to read about that Iggy Pop cannot live with his music or how little Aloe Blacc gets royalties from writing one of the biggest songs of the year:

Avicii’s release “Wake Me Up!” that I co-wrote and sing, for example, was the most streamed song in Spotify history and the 13th most played song on Pandora since its release in 2013, with more than 168 million streams in the US. And yet, that yielded only $12,359 in Pandora domestic royalties— which were then split among three songwriters and our publishers. In return for co-writing a major hit song, I’ve earned less than $4,000 domestically from the largest digital music service.

But what is truly the alternative?

Iggy Pop makes his money from advertisements. He could not do those without being a musician first. Although he remains fit, I doubt it is from starving.

I appreciate Aloe Blacc tremendously. I have been supporting him by buying physical records made by him from the start of his career with indie group Emanon. Is Aloe Blacc better off now or when he was pressing and self-publishing his records? Although the revenue share from “Outside Looking In” was probably more favorable than the terms and conditions of Spotify, he is now more successful by every account. “Wake Me Up!” would not be as big song without Spotify and the exposure of that song has benefitted Aloe Blacc way more than the petty 4000$ from the streaming royalties. The sad fact just is that the individual hit song will not necessarily make you money anymore. That song is more of advertising. Is it right or wrong is a philosophical question, but does not change the shifted dynamics of music business.

I agree that 4000$ looks shameful for making one the biggest songs in the universe, but life is not fair. People do not want to pay for physical music anymore, expect for old luddites like me, who still get excitement from the special box sets. Actually I am more worried about the viability of Spotify´s business model. They are currently handling over 70% of their revenues to different rights holders according to Spotify CEO Daniel Ek:

Spotify has paid more than two billion dollars to labels, publishers and collecting societies for distribution to songwriters and recording artists…that’s two billion dollars’ worth of listening that would have happened with zero or little compensation to artists and songwriters through piracy or practically equivalent services if there was no Spotify.

They are not profitable yet, either.

“Wake Me Up!” has been estimated to generate almost million in Spotify royalties. Someone is getting paid (and there might be a master plan behind it). The history of music has not really been a financial success story of artists. Record labels, shady managers and other Svengalis have exploited the creative work of musicians. So either the artist are afraid, smart or just increasingly naïve by pointing the finger to Spotify instead of their employers, record labels with whom they have signed their contracts.

You can still make money out of music, especially if you are strong brand, innovative or just really good. Dave Grohl (from one-of-the best live bands in the world) sums it up nicely on Reddit discussion:

Me personally? I don’t f*cking care. That’s just me, because I’m playing two nights at Wembley next summer. I want people to hear our music, I don’t care if you pay $1 or f*cking $20 for it, just listen to the f*cking song. But I can understand how other people would object to that. You want people to f*cking listen to your music? Give them your music. And then go play a show. They like hearing your music? They’ll go see a show.

Amen to that.

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You Have Listened to Led Zeppelin, Would You Like to Listen to Prince?

First rule of being a planner:

Don´t think that you represent target audience.

You have to understand the target audience. Know as much as possible about them. Talk with them. But never think that your own behavior resembles anything that normal people are doing.

Unless you are targeting 30+ years old dudes still wearing sneakers and knowing too much about popular culture.

Majority of planners are snobs in various fields, and this does not exclude yours truly. Therefore I have never seen the reason for automated recommendation algorithms. I will always know what I want to listen or watch. I have spent majority of my life listening to obscure records and watching odd movies to be able to entertain myself in every occasion without outside help. If I need recommendation, I only trust in a handful of established aficionados, who have earned my trust.

I will always favor human curation over algorithm.
Therefore this recommendation in Spotify made me laugh:
Prince Spotify
You have listened Led Zeppelin, now listen to Prince.

How stupid is that? It would be like recommending broccoli in restaurant because you like meat.

“Eugene Goostman” might be able to act like a human, but this recommendation did not raise hopes for reaching singularity for a while.

But here´s the trick:
I like Led Zeppelin.
I like Prince (the song is from one of my favorite Prince albums).

So actually recommendation was not off. It just came from surprising angle. Maybe the Spotify algorithm knows more than it appears. If there would be more people, who listen both Led Zep and the The Artist Formerly Known As Prince, the world would be a better place.

Eventually it boils down to this: as long as the recommendation pleases the audience, it does not matter how off or not it is. That is why I don´t really think that the future of streaming services lies in super-smart recommendation engines or human curation. It will be about vast catalog. Streaming service, able to secure The Beatles to its service, will probably go long way.

Maybe recommend some Rolling Stones to go with that.

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Nuttin But A Beats Thang: Apple to The Next Episode

dredaystickers
It has been a real Dre Day, although it is not February 18th.
After long rumor mill, it is finally official. Apple acquired Beats headphones.  The deal has cause quite a lot of buzz around the globe, but I think the deal makes sense from many perspectives:

1. Beats is a good buy.
Buying Beats is not a speculation. Apple is buying a company, who is dominating premium headphones market with over 51% market share (some estimates have it even higher). As Beats is private company there is no public revenue numbers, but there are estimates of 1B of revenue with probably quite high profit margin. Buying 1 billion business for 3 billion is not a long-shot (like WhatsApp acquisition, which had significantly higher price tag) it is pure mathematics. You are buying market leader with an already established business and fast growth.

2. Beats gives Apple a headstart with music streaming service.
Yes, Apple could build their own streaming service, no one doubts that. Having Beats streaming service gives them great launchpad to go into a territory they have neglected. And I would not also worry about negotiating about the rights again. Apple has been quite effective in doing that in the past. Apple CEO Tim Cook stressed the importance of music in the recent interview:

This is all about music, and we’ve always viewed that music was key to society and culture. Music’s always been at the heart of Apple. It’s deep in our DNA. We’ve sold Macs to musicians since the beginning of Macs. And we accelerated the music industry with the digital music revolution with the iPod and the iTunes music store.

When we talk about Apple today, the music has not been on the focus compared to the heyday of iPod & iTunes. This deal makes Apple´s music offering again interesting. The future of music is streaming (although as an avid record collector, the future and past will forever be on vinyl) and that is something where the almighty Steve Jobs was wrong. This acquisition enables Apple to get on the parity with competitors and on the other hand provides Beats Music immediate increase in interest. It is probably no coincidence that Tim Cook mentioned Beats Music as the streaming service which has “gotten it right”.

3. Beats will be an important part of the Apple´s wearable tech puzzle.
You seldom buy companies because of their current state, but because of the current potential. That is where I think this gets really interesting and I am quite sure that Apple will be having some tricks on the sleeves and not just concentrating on music with this acquisition.
iWatch has been rumored for a while. It will probably arrive when you least expect it. It is certain that Apple will enter to the wearables and they will probably do it right as well. Although the wearables have not yet really taken off, believe me eventually they will. We overestimate technological disruption on a short-term and underestimate it on a long-term. Apple has also been massively successful in fulfilling needs of the people, they do not even realize they have.
Beats headphones have been one of the best examples of wearable tech, because they have really nailed the lifestyle aspect. Sound quality is one thing, but you really want to be seen with your Beats headphones. This is something the first wearables have not really grasped. When wearable tech looks ugly only the geekiest early adopters will wear them. And no offence to geeks but they do not start trends. Wearable technology is even more fashion than technology.
Apple has definitely understood this as they have also been recruiting fashion specialists from YSL and Burberry. I don´t believe that is an isolated strategy from the Beats acquisition.

4. Buying beats is getting the right talent
You are hiring Dr. Dre, one of the most legendary music producers ever and Jimmy Iovine, who knows the ins and outs of the music business. Iovine has been also key partner with Apple during the launch iTunes Store. Both are visionaries and can definitely help Apple to shape the future of music and wearable offering. Will they fit in Apple corporate culture? Who knows, but at least you could not hire more capable talent to help you in your future endeavors.

Also I do not really get the talk about how uncharacteristic this acquisition is for Apple.
Yes, they are usually buying smaller and more obscure companies (at least for mainstream audience). Nevertheless they are buying companies.
If you have loaded cash reserves, I don´t understand why you should withdraw from buying other companies. If it makes sense and in this case it does.
Necessary part of evolution of a company is to know when to do something surprising. This was surprising move (initially, not necessarily today because it pretty much just confirmed the rumors), which showcases that Apple does not sway away from being bold.

So put on “The Chronic” on your turntable or your favorite streaming service and:

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