Monopolistic power of algorithms; and the Multiple paths to building a bank for creators
Edition 04
Hi folks
Happy Wednesday! Welcome to The Industry Playlist 🎵
I've been writing this for some weeks now, and I'm thoroughly enjoying it. Some housekeeping, there are more people reading this now (non-UTR team) and so everyone is bcc-ed now. Second, I'm going to club themes together to get to the insight quicker so you might see varying styles - continue to share feedback on what is helpful for you.
This week you'll find me taking a dig at the monopolistic power of algorithms (both economically and culturally) and why the race to build a bank for music artists has multiple roads.
If you haven’t subscribed already, here is your chance
Spoken word and hip-hop? Check out this British artist mixing poetic lyrics with nostalgic beats - Seasoning by Antony Szmierek - as you read
Now, let’s get to it.
SONIC SHIFTS
Market consolidation (shift to a monopoly) and algo development are two sides of the same coin [Tech] [Biz]
DOJ is suing Live Nation for the alleged “monopolisation and other unlawful conduct that thwarts competition in markets across the live entertainment industry”. This is just another version of the backlash against Big Tech in the music industry. Live music venues are dying (trend started before covid), the cost of fandom has become exorbitant, and we are witnessing a deep erosion of music culture. India is not there as yet but this tells you the world we’ll also be staring at in the future if new business models do not emerge that support a distributed music culture ecosystem. Skillbox is the closest example of Live Nation for India and they’ll gain disproportionately as the independent music scene evolves in India - bringing the positives and negatives, impacting culture significantly.
Race to build a bank for artists [Tech] [Biz]
The economic revolution in music is going to be lending to artists (or promoters - still an open question). If this doesn't make sense, imagine a world where a music artist could take a touring loan, an equipment loan, a marketing loan; just like how you have a car loan, home loan, personal loan today.
Some new developments; each taking a different approach to build a credit risk model -
[Web3] Opulous AI - Opulous AI enables you to search any artist’s song and, utilising an AI algorithm, generates a future royalty prediction across all streaming platforms, leveraging its current performance on Spotify.
[Data Purchase] European Music Managers Alliance teams with BeatBread on advances for members - They have changed their approach -initially focussing on individual artists, now they’re engaging with artist managers collectively. beatBread is loaded with venture funding, and uses billions of data points to forecast an artist’s earnings potential. It’s a wolf hiding in sheep's clothing (I intend to dive deeper on this later) - tread carefully if you are an established artist.
[Distribution] Stem Partners with Victory Park Capital to Deploy $250M to Artists - New age music distribution companies are getting in the race. Stem founded by Milana Lewis is on to something, she might be the only musictech founder obsessing over the customer (artists) and working with them to build an artist advance product. I would follow her thought leadership closely, for her refreshing take on the future of music and creativity.
Global Music Revenues to Hit $100 Billion by 2031 [Biz] [Fandom]
Honestly this stuff is the worst of the lot. I’ve been a consultant myself to know such macro numbers are basically intellectual fluff that headline well. This macro fluff is what hides the winners and losers, the owners and creators, the art and the business; it subsumes all into one. Now, more than ever, we need more ‘state of culture’ than a ‘state of business’ thought leadership.
READ THIS SHIT
The music industry was not built for the digital age
I love this chart. It tells you everything about how music consumption technology has evolved, leading to a situation where despite more listeners/consumers in the mix, the value of music has gone down. This article makes a technical point about how poor data management practices has led to this outcome vis-a-vis gaming which has only gained with every new technology. I have another hypothesis which has more to do with the social/cultural side of things - gaming tech has been about worldbuilding with social inbuilt, music tech has been about access but decreasing social elements. That access, coupled with tech killing offline business models for grassroots live music, has perversely contributed to listening becoming a commodity consumed independently. That’s why the gaming pie keeps growing while the music pie gets spread thin.
The Playlistification of Music - YouTube (18 mins)
Deep dive into the economics of streaming, and what it has done for creativity in the last decade. In other words, algos are doing their job of transforming ‘art’ to ‘content’.
Are kids losing their love for music?
Not a category of music consumers most people think about, but streaming means they need digital devices and parental permission to play music. We’ll only see the suboptimal effects of this reality in the coming decades, unless culture>tech.
Let's Just Admit it: The Algorithms Are Broken
I’m on this page. Curators have been squeezed out. We need more cultural beacons, not algorithms (below graphic tells you we are moving to a passive world). Algos have become the source of monopolistic power; I suspect legal jurisprudence and anti-trust legislation will be required to break the hold.
Related: [Attached PDF] Study reveals how Spotify algorithms affect listening and discovery - Summary guide on the biggest trends.
The Brutal Reality: Power is shifting to AI-generated music and algorithmic discovery
Stef Van Vugt is many things, but he’s not a luddite. The story he’s painted below (see graphic) is how tech breaks the artist-fan relationship and puts itself in the middle. His label Fruits Music is worth checking out.
KEEP TRACK OF
Women Led Music Organizations to check out
Organisations are taking action to expedite equality and empower women to step up, fight back and build a better future for all of us.
Open source discovery algorithms
If you are familiar with Every Noise at Once, you’ll like this. GNOD (Global Network of Discovery) is an open source project that is building products that help us discover more and better things, from music, to literature, to movies. They launched something called MusicMap which is super interesting - I plugged in Ritviz and it spit out this (see graphic below)
INTERESTING STUFF
BBC Soul Music Audio-series
BBC has an entire series (~200 episodes) about pieces of music that had a powerful emotional impact when it came out - each episode is a different soundtrack.
Glenn McDonald spent the last decade shaping how Spotify curates and recommends music. In his new book, he explains how it all worked. He is also the person behind Every Noise at Once.
That’s all for today. We’ll be back in your inbox next week.
Thanks for reading,
Rohit