Apple and the Future of Music

Apple has officially entered the music streaming space and no one quite knows what to make of it. It’s an interesting time for music, because while nearly everyone listens (universal appeal is a pretty rare and beautiful thing for tech products, especially when it’s >> sexier than email), no one can seem to agree on or prognosticate what the future of the space will look like. While we wrestle between on-demand vs live radio stations, social vs non-social, manual curation vs algorithmic recommendations, mobile vs web, and how discovery is best achieved, we can still all agree on one thing:

The future is digital, dude.

Terrestrial radio has nearly 100% saturation among the American populace, but the internet, not AM/FM/XM, is the future distribution channel for music (and all media). All the while digital music is increasingly mobile and on-demand rather than live or web-based.

The evolution of music has been an interesting one and many of the existing major players have defined their core UX around incremental evolutionary steps that led us here. TuneIn (est 2002) was the first company to use the internet to let anyone live stream a radio station from anywhere in the world, otherwise known as an FM Tuner. As best I can tell they, not Russ Hanneman, put radio no the internet ;).

iTunes + iPod killed tapes and created the personal digital music library. Then Napster and other p2p illegal sharing services undercut that. Then SoundCloud and Spotify were both founded in Sweden approximately 1 year apart (2006 Spotify, 2007 SoundCloud), killing the personal music library and CDs. Spotify was an experiment in offering an alternative to piracy through a superior product and better, on-demand access to music at a more affordable and reasonable price point (yes it is fair and Taylor please come back). SoundCloud was the solution to sharing large audio files on the web for artists and musicains in the pre-DropBox era, which evolved into the defacto way for people to share custom music with one another. All the while, Pandora (est 2000) remained one of the most highly used music services by allowing algorithms, powered by the music genome project, to create dynamic radio stations on the fly, modeled after terrestrial radio, but personalized to an individual user’s preferences and responsive to real time input.

You could think of TuneIn as digital radio 1.0, Pandora as 2.0, Spotify and SoundCloud as 3.0, and now we are finally in an era to figure out 4.0 will look like.

Where do these services stand today, by relevance, measured by active monthly users?

  1. SoundCloud: 250M
  2. Pandora: 80M
  3. Spotify 75M
  4. TuneIn ~50M?
  5. Apple Music / iTunes unknown AMU (but 800M+ users total)

*yes there are other relevant services too: Tidal, Dash Radio, rdio, etc. but for the sake of simplicity I want to stick with the 5 above

What’s curious about the current landscape and what it brings to bear on the future, is that in a lot of the tech journalist and insider coverage of Apple Music, you don’t hear SoundCloud or TuneIn mentioned. And you hear Spotify mentioned a lot more than Pandora.

Why are the 2 current leading digital music services, by AMU, not the most talked about, or the default comparison point, for Apple Music?

It’s because SoundCloud is weak for mobile and because on-demand, lean functionality is more important to the core listening experience than lean-back channels of recommendations. Spotify is simply more germane to what the future mobile listening experience looks like, and it’s look and feel is more similar to Apple music than any of the other services.

In essence, TuneIn and Pandora are secondary features layered on top or or in addition to the core experience. In Pandora’s case, a better version of Spotify Radio.

The other interesting elements that remain on the table are:

  1. Does live streaming still have a role? (@beats1)
  2. Is social relevant to the music experience?
  3. How is music best discovered?
  4. Does other audio belong baked into the music experience?

Does live streaming still have a role?

If you had asked me before Apple Music launched, I would have unequivocally said no. This isn’t 1920. We have access to the entire internet, why would we subject ourselves to the limitations of whatever happens to be live now, without having any controls to skip forward or influence (personalization and customization) what is played. Hell, we don’t even watch live TV anymore.

I still largely think this, but Apple has caused me to re-evaluate if there is room for live streaming “radio stations” in the future of mobile music consumption. Perhaps another secondary core feature similar to Pandora. And maybe, there is. I think a diversity of stations would be needed, but in many ways manual curation of music can be better than digital, and often times, most of us just want to hear good music instantly without having to put any effort into it. That kind of ease and simplicity shouldn’t be underrated.

2. Is social relevant to the music experience?

I think it is, but I’m not exactly sure how it should manifest. I really like the ability to share music directly with my friends, scattered across the country. I use Spotify’s collaborative playlists for this. I also think, as a passive filter, being able to have search results of songs influenced by general popularity, like what Spotify already does, is a great way to help curate music across the entire library. But all of this is pretty secondary to the core experience. Even though Spotify’s breakout success in the US was spurred by viral growth propagating across Facebook, it never became a social platform for sharing. The inbox is rarely used and Spotify’s “notifications” are one of the few examples where I don’t even click on them — not even to clear the badge count on my app. Spotify simply isn’t social.

But SoundCloud is — and incredibly so. And I think there are some really important and possibly underrated aspects of having fundamentally social elements baked into a music app. First and foremost, it should be dead simple to share a song with a friend and it should be as socially engaging as a conversation on Twitter (there’s no feeling as sweet as a retweet).

I think the social vaccum is probably the most interesting unknown surrounding the future of the mobile experience. The best social service, SoundCloud, is struggling to be relevant in the mobile age. I haven’t seen numbers, but I would guess the majority of their user activity is web-based, and while they have excelled at externally sharing and embedding audio across platforms and devices, their mobile footprint seems weak and their future (acquisition, self-sustaining money making machine, etc.) uncertain.

If you had asked me before Apple Music launched, what the chances were that Apple could create or successfully integrate an acquired social app as part of its core or native offering, I would have said very low. Apple is great at hardware and shitty at apps. But anything can change, especially with pockets that deep, and while I have many complaints about Apple Music’s UX, it has undeniably done some great things that Spotify, SoundCloud, and no other existing music app have. It’s a contender. And it demonstrates that they can compete in the app game.

Spotify has to be nervous. No one wants to go toe-to-toe with Apple, and Spotify for a long time seems to have been stagnating when it comes to their core UX. They’ll need to do something to differentiate their experience from Apple Music, and social just might be the answer, because it’s the thing Apple is in the weakest position to do anything about.

3. How is music best discovered?

Curated lists? Algorithmic recommendations? It’s hard to say. Many people really like Apple Music’s initial discovery, in so far as after digging through a shit ton of playlists, featured content, new releases, etc. they were able to find new music that appealed them, and this is key: quickly.

Pandora has long been regarded as the best algorithmic recommendation service, and I’ve never heard a single Spotify user rave about Spotify Radio. It seems Pandora has the better software, but is limited by a smaller catalog, which is a significant setback, leading to an increased chance of repeats or variations of the same song.

Ultimately, I think discovery is probably wide-open and has room for all of the above: Pandora, editorial curation, possibly live-radio, and definitely potential from social elements (direct shares, collaboration, recommendations based on users similar to you, etc.).

One thing that seems obvious that I’m not sure if Apple Music is tapping into or not are the existing music libraries its users have. I would guess in most cases, the libraries are out of date as many of us stopped purchasing singles and albums a while ago, but there is a rich, untapped data mine for better understanding their users they could leverage for a large advantage when it comes to smart recommendation.

4. Does other audio belong baked into the music experience?

Such as podcasts or live talk radio. I don’t think so. I think simplicity and specificity win. Music has a unique categorization to it and represents its own use case and user experience. I think terrestrial radio will die a slow death and it’s digital incarnation will live on as an unbundled experience: 1 music app, 1 podcast app.

So what is the future of music?

No one knows, but we are likely to have a better idea soon.

If I were running SoundCloud or Spotify, I’d be very nervous. I feel like both of those companies have failed to innovate on their core user experience in quiet sometime and Apple’s entrance into the marketplace might be a forcing factor to spur them to level up their listening experiences.

I think social is Apple’s Achilles heel, so who knows, if Spotify and SoundCloud join forces, maybe they could create a powerful alternative that even Apple can’t contend with.

But it won’t be easy, because Apple has an insane anount of money and can even afford to play games with artists, and entice them to pull catalogs from Spotify and SoundCloud. Apple could artificially inflate payments to artists and labels if they agree to be exclusively on Apple. This seems more sinister than we might expect Apple to be, but anything is possible.

IMO Taylor Swift doesn’t have a sound reason to not be on a Spotify, and it’s a big deal. If Apple maintains this difference, and gets say The Beatles on as well, and whoever else is holding out, in aggregate it could manifest as a large differentiator — however one that I ultimately think is not in the artists’ or listeners’ interests.

But only time will tell! =)

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