In recent news Spotify has partnered up in a steamy business relationship with Starbucks. The deal makes Spotify the sole supplier of music to all 7,000 Starbuck stores. Baristas will be creating music playlists, using Spotify’s Premium membership in early fall. Starbucks reward members will have access to music on Spotify and have a huge influence on what is played in the stores. Reward members will also be able to use their star rewards as currency just like a virtual jukebox, for subscribing to Spotify’s Premium membership.
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Entries in spotify (20)
Billy Corgan, Smashing Pumpkins frontman, believes that the music business model is outdated and takes advantage of artists. Corgan said, “The music business is mostly run by feckless idiots who do not subscribe to the normal tenets of capitalism which when they do, the business tends to work out well and stars tend to rise to the top, everybody benefits, but it is still a parochial business. It is run by thiefdoms way behind the times technologically.”
When Apple launched iTunes in 2003, Apple addressed the consumer’s wants by giving them the choice of buying a whole digital album or they had the ability to buy a single track from the album. Apple did not start iTunes to sell music, however to sell the hardware that Apple sells, the iPod. Apple has tried to control music sales since day one to raise the demand for Apple products. In the beginning Apple’s iTunes used DRM technology to block out other competitors that sold MP3 players. This would leave consumers dependent on their iPods. In 2005 Thomas Slattery, filed a lawsuit against Apple. This lawsuit stated that Apple broke antitrust laws by using FairPlay. Any music purchased from iTunes would work only with Apple’s iPod, which froze out competitors. Apple has been a dominant force from its music sales since it’s starting point. Apple has flexed its muscles to control music distribution and deals that worked to their benefit.
In 2010 Apple’s iTunes store started see a decline in sales for the first time. It was at this time that music streaming service started to come in full swing, at this point Spotify was not even introduced to the US Market. Now the tables have turned and Apple is trying to recreate itself once again to address the consumer’s wants by giving them on demand streaming through their revamped Beats music service.
In 2014 iTunes music downloads declined by 14%, while Spotify’s subscriptions increased. Since 2011, Spotify has grown from 10 million subscribers to over 50 million subscribers. I find it funny that the iTunes split of 30/70 will come back to haunt Apple. Basically, the competitor who is stealing streams for downloads is using the same slit. Apple was once making dollar to dollar and now they’re making pennies to the dollar.
Apple, along with Beats music, has to show consumers the value of spending money on a subscription service each month. While other competitors give away freemium tiers and lower subscription fees, this is going to be a hard sell, however, not an impossible one. If anyone can introduce a creative, innovative way for consumers to stream music, it’s definitely the folks at Apple.
By John Lahr
As of January 21st Spotify now has a legitimate contender in the music streaming market, as Dr. Dre and Jimmy Iovine’s Beats Music steps into the ring. It is the culmination of eighteen months of development after Dr. Dre’s lucrative consumer electronics company purchased MOG in July of 2012. Entering with a soft launch in late January, the service announced its arrival in spectacular style with a Super Bowl advertising blitz featuring T.V personality Ellen DeGeneres. While Beats Music and Spotify have many similar features, both services have very different views of the future of the streaming marketplace, and different ways of communicating their vision to consumers.
Like Spotify, Beats Music offers a library of over 20 million songs to choose from, the ability to create playlists and sync them to your mobile device for offline listening, and a radio feature1. However Beats offers far more advanced features for discovering music thanks to its “Sentence” radio and “Just For You” curated playlists tailored to taste preferences you give when signing up.
Spotify has unveiled one hell of a lot of features for independent artists these past few weeks. To be honest, I had a hard time sifting through what a lot of the new features were, namely; why getting an artist “verified” mattered at all, what the point of playlists were, and what Spotify analytics could do that other types of data couldn’t.
I’ve done my best to put the new Spotify features into laymans terms to help you understand what they do AND how you can get them up and running so your Spotify profile kicks just as much ass as a major label artist. I’ve also included 6 promotional tips at the bottom of the article to help you leverage Spotify’s new artist tools to gain new fans and more plays on the music-streaming service.
How much does Spotify pay artists? It’s the biggest mystery in music. One independant artist claims to have received a measly $0.004 per stream. There was a rumor that Lady Gaga only earned $162 from a million streams. Even indie band Grizzly Bear chimed in to express their displeasure with the alleged slave wages of Spotify declaring that they only received $0.001 per stream. Some have even taken to restricting their music from the service altogether. Is it really that bad? are the payments that low?
Cazzette is about to blow up, or at least that’s what one of the world’s largest streaming services claims. When their debut album Eject drops tomorrow, it will be marketed in full force by Spotify to millions of users worldwide. The major marketing push is really more of an experiment for the company to discover whether or not they can help break new artists. It just so happens that their first “experiment” is being done with one of the most hyped EDM artists of the year. Cazzette is a Swedish DJ duo consisting of 23-year-old Alexander Björklund and 19-year old Sebastian Furrer. They just wrapped up a 17-date September tour in the US and have received support from David Guetta, Tiësto, Swedish House Mafia, Avicii, and Martin Solveig to name a few. The underground success for the duo began a year ago when Cazzette released their first track, a remix for Avicii entitled “Sweet Dreams (CAZZETTE meet AT NIGHT Mix), which charted at the Top20 on Beatport Top100 General Charts for months. Soon after, their bootleg of Adele’s “Set Fire to the Rain” landed the number one spot on HYPE MACHINE Most Popular after being uploaded on their Soundcloud page.
The conventional wisdom among music technology theorists is that the traditional model of listening to music has changed, that music fans listen to streaming services like Spotify instead of buying music. I haven’t seen data or research to support that argument yet, only industry buzz, but I imagine it’s true for a strong minority of music fans. And industry data may support the trend as well; however my own, admittedly anecdotal, experience doesn’t.
You might think this is quite a rash and bold statement but I can guarantee you within the next 5 minutes of reading I’ll have it well justified. We all know that independent musicians from day one should be working themselves like a business through production, promotion, sales and shows. All of which incur some set up fee or ongoing costs. These costs vary depending on the size of the project or how smartly the independent has measured their market and are willing to invest. Even though spotify keep hush hush the amount of royalties that are paid through spotify, some speculation and leaks show what they are really paying artists.
People want free music. Artists want to make money from their art while supplying people with music, be it free or otherwise. Could Spotify, Rdio, and MOG be the answer? Does our use of services like Soundcloud, Bandcamp, and Reverbanation handicap the revenue potential of those services?
So, I was reading an interview in Wired Magazine on Marc Andreessen, the creator of the first browser, this past weekend and he was asked about the future of the web. In the article titled ‘The Man Who Know’s What Next,’ Marc states “The application model of the future is the web application model. The apps will live on the web. Mobile apps on platforms like iOS and Android are a temporary step along the way toward the full mobile web.”
I interviewed Ari Stein of WahWah.FM a month or so ago and he told me “Who knows 5 to 10 years from now apps may not even exist.” This was a very interesting statement to me, because WahWah.FM is a mobile app which is currently available for iOS users only with plans to create an Android app once additional funding is secured. I pondered about making that statement the title of the post but I wanted to focus on their product because I think it’s great.
How do you place a measurable value on music? Thanks to a tweet from Hypebot I came across an interview with Spotify’s Daniel Ek on Grammy.com, posted in early February. Aiming to keep this post shorter than my last; I won’t dwell beyond this paragraph on how awkward it is for Grammy, the self-appointed standard bearer for artistic expression in music, to be asking anything of Ek. Shouldn’t it be the other way around? Representatives of music distribution services should interview Grammy insiders about trends in popular music - to gain insight into the creative forces behind music. Or not. Anyway, the interview was pretty typical Ek; Too focused on technology and consumption for my tastes. He is the future as he sees it. Best to read it for yourself though.
I’m trying not to be a Spotify hater. It has done a lot to innovate in the music space - especially on the consumption side. The social integration part is well-executed, though it too has its detractors. I have met some of Spotify’s developers, ran into them at an industry conference hosted by Amazon. They are nice folks, very enthusiastic about advances in local network caching and reduced edge-server latency. They are also particularly fond of that “bringing the pirates into the light” narrative. The story about how people do not need to torrent/file-share/steal music anymore, thanks to Spotify. It seems to come up a lot. It is probably in their welcome packet for new employees. Whether or not they are misguided is debatable, but they certainly aren’t all bad. Spotify is not the “Death Star”, back to destroy what’s left of the music industry. It also isn’t the industry’s savior, it is no Luke Skywalker, if you will.
We are in a day where the choice is yours. No one is obligated in using particular services or products. Believe it or not I own no Apple products. I was given a 4gb iPod shuffle as a gift one year. I lost it about a month or two later. I went out, bought an 8gb memory card, loaded up my blackberry with music and never looked back. Sure the commercials and other marketing campaigns for Apple looked and continues to be great, but at the end of the day I have a choice. I say this to say, I don’t understand why artists & music industry personnel continue to lash out at Spotify. As I tweeted earlier today, if a download is .99, how much do you expect to get from a stream? That’s not Spotify’s fault. They didn’t create streaming, they just created a great model to capitalize off it.
Piracy was what the (now dormant) SOPA bill was all about, and was never far from anyone’s lips at MIDEM this year. But bored of the same tired arguments against piratebay, bittorent sites and the infamous Megaupload, the industry has turned its attention to those who actually do stay on the right side of the law