What The Music Industry Can Learn From Porn
How do you remain a top grossing consumer industry when content isn’t king and sex doesn’t sell?
The internet has disrupted many industries, but two stand out for capturing massive mindshare while struggling to convince consumers to pay for their products in the face of the availability of free digital versions. One of these industries continues to wring its hands and struggle, while the other forges ahead, raking in massive profits every year. The music industry needs to take a cue from porn.
Resisting the frictionless (and free) spread of music content is tilting at windmills.
It’s not that the angst over piracy, illegal downloads, and copyright infringement is illogical. On the contrary, having gotten my braces removed the day Napster went under, I’m well-versed in the very real threats to not just the status quo, but to the revenue streams of content creators. But, much like free porn, free music isn’t going anywhere. But while the major porn companies long ago confidently diversified, major labels still seem to be wringing their hands, dipping a toe into event promotion here or digital distribution over there. Ever since digital disruption ended the artificial scarcity of music by forcibly relieving major labels of their monopoly on content distribution, and with the news this week that Beatport will freeze payments to labels as SFX ‘goes private’ — Beatport could be sold off for scrap to raise capital — it is increasingly clear that music content is only valued by its own industry in bulk. Many artists have made peace with this reality, willingly giving away albums or regularly trading free downloads for social media ‘likes’ or ‘shares.’
Digital transformation is an unstoppable force, and by sheer momentum something truly amazing is happening: from camgirls and twitch streams to self-taught DJs with day jobs (the homies Subset and Housing Corp come to mind) who can not only get paying gigs in NYC but can create an entire scene — vibrant, lucrative, familial — in just a few years. This democratization of the means of production and distribution is nothing short of magic. For consumers (now empowered as creators), the game has changed. Economic analysis supports this thesis: music creators are stronger in numbers and bringing in significantly more income than in the pre-Napster and immediately post-Napster days. “Innovation” in the industry, meanwhile, seems focused on how to turn back time — how to get customers to pay for something they are already accustomed to being able to consume instantly at low or no cost.
From Beatport to Beats, Tidal to Google Play, experimentation in music content delivery abounds. Some will offer free (ad-supported) streaming, while others have only premium tiers. This type of “innovation” is predictable: there will always be consumers across a spectrum of ability to pay, and solutions designed to serve consumers across that spectrum. Consumers will vote with their feet — flocking to the most friction-free experience largely regardless of cost. For now, price points don’t matter as much as experimentation; the beauty of the market is that part works itself out, over time. But ultimately, consumers want to be delighted, and they are ready for industry innovation that doesn’t just look like a new content delivery method.
It’s time that the industry that controls the commerce around the content wises up to the broader context of the shift that’s occurring: the internet is the infrastructure. It’s not going anywhere.
Adapt or die.
So what can the music industry learn from porn?
Give it up.
The adult industry is undergoing massive shifts in reaction to a glut of free and readily available adult content, but it is not hurting for revenue (insider estimates place the size of the industry between $4–10 billion). The availability of free content doesn’t have to be a bad thing — often, it enables new audiences to discover and access products. In contrast to the traditional model — expending massive marketing dollars hoping fans will pony up the $10–20 to buy an album, artists that have chosen to give their music away (or ‘pay what they like’) have profited from massive buzz and fan goodwill, torrents notwithstanding. Focusing on track or album sales turns out to be a short-term — perhaps even myopic — metric. The adult industry long ago learned to diversify: while the images and videos of models remain the flagship product, the revenue comes from a dozen other places.
Follow the dollars.
Sex in itself doesn’t sell when the same actors can be seen for free in another tab. In many ways, the adult industry faces bigger barriers than music: stigma abounds, making word of mouth an unviable marketing channel. Conversely, for the consumers who will also function as your best advertising, music is life. Ironically, this industry that spends so much energy wringing its hands over illegal downloads and lost dollars captures almost as much of my wallet as food or rent. I spent just $120 on 12 months of Spotify Premium content streaming in 2014, but over $1100 on Ticketfly over the same period on tickets for DJ sets at just two venues. Similarly, I happily coughed up over $1000 just for one weekend on the holiest of ships. And recently, I paid nearly $90 just to get kidnapped and blindfolded by the UK-based DJ Hot Since ’82 for a few hours (tickets sold out almost immediately, 6 weeks in advance). A strange experience, to be sure, but I have no buyer’s remorse.
Offer premium content experiences.
Of course, content itself can be an elevated experience, as anyone who has ever watched The Wizard of Oz while listening to “The Wall” knows. It’s up to the music industry to invent the types of content listening experiences consumers are willing to pay for. An early example is deadmau5's app, which offers exclusive content at the in-app cost of $5/month or $50/year. In porn, “premium content” tends to mean higher quality video; in music, it will also mean invoking additional senses to accompany taken-for-granted sound. And though concert ticket sales have roughly tripled since 1999, live music is not the end of the answer. Technology will help. Subpac has developed a portable, wearable subwoofer, giving a whole new meaning to “haptic feedback” in the music-tech context. Already, silent discos are popping up that feature this game-changing technology.
Invest at the edges of the system.
Today, the money in the music industry is in partnerships, performances, premium content. Experiences, engagement. Already, music is ubiquitous — to many of us, it’s risen above being the soundtrack to our lives — music itself is a lifestyle. There is money in that. Tomorrow, however, the money may be in personalization, haptic feedback, virtual reality. Just as the adult industry has telepresence, robotics, and advanced materials to play with, music looks to a rich horizon of extremely promising innovations. Taking advantage of that horizon tomorrow means engaging in unlikely collaborations and rampant experimentation today.
Be digital (and friction-free).
The adult industry has long been a driver of digital progress. Part of the beauty of digital technologies is in reducing friction and intermediation, which is why my friends working in the adult industry literally owe their careers to the internet. As much disruption and piracy as cyberspace has wrought on the status quo, it has also completely leveled the playing field for incoming talent and enabled independent content creators to gain an audience. An industry that invests in its content creators even when the business case is cloudy will be stronger for it in the long term. And an industry that replicates and reifies the naturally friction-free digital environment throughout all of its services and offerings will win.
Cultivate tribes of listeners.
Attending Holy Ship means I’m part of the “Gary Richards and Holy Ship-centric international posse of grabassery known as #ShipFam.” This tribe is incredibly influential on my purchasing decisions. There are more examples of elements within the industry that understand this; the genius Barclay Crenshaw (better known as Claude VonStroke) does an amazing job cultivating his tribe of dirtybirds with the #downstroke and the @dirtybirdsnap Snapchat account (it doesn’t hurt that prominent dirtybird Justin Martin is one of the funniest people on earth). But engaging with consumers isn’t just for label/event boss men who also happen to be incredible DJs and producers.
Engage with consumers to drive the industry forward.
If it seems like I’m speaking to the dance music vertical specifically, it’s not only because this is naturally the most innovative and technologically advanced segment of creators. The industry itself can capitalize on the explosion of dance music to experiment and find proof points for new best practices in marketing and content creation to be applied across the industry. But know your audience. Dance music fans are educated and diverse. They know disruption is happening and yes, they are ready to interpret your policy change as an attack. Active consumer engagement can turn your most rabid critics into your most ardent supporters — these aren’t your average trolls: the fans bitch and moan because they truly care about the outcome. Give them a voice.
Don’t forget about females.
Women account for only 1 out of 50 purchases of porn-site subscriptions, but make up some 25% of online pornography traffic. Heavy-hitters in music would do well to learn from the failure of mainstream pornographers to cater to this audience. Female fans are especially likely to pay a premium for female-friendly merchandise (crop tops: so hot right now), engagement with artists, and virtual goods. And, as killing-it artists like Rezz, j.phlip, and Anna Lunoe demonstrate, the music industry may already be less hostile to female domination than are many segments of the entertainment industry (including porn and gaming but perhaps especially Hollywood). Nurture these artists and their fans for a more sustainable future for dance music.
Give it time.
Like porn, music isn’t going anywhere. And with the breakneck pace of technological change, as William Gibson says, “the future is already here — it’s just not very evenly distributed.” In a surprising example, broadcast radio and owned music still represent a roughly 70% share of American listening hours. As more and more ears shift toward digital streams (which more evenly distribute payments across content creators and performers than do radio plays), changes to both revenue and exposure will increasingly benefit artists. In other words, the transition to digital already in motion may become less painful for the industry over time, though the growing pains are real now.
Music has never had a bigger cultural mindshare, but it is somehow commanding less consumer spend than ever before (or at least since RIAA started tracking). As in other regulated industries, the most interesting innovation in music is coming from smaller companies with the flexibility to experiment. As the dinosaurs crumple under their own weight, industry observers would do well to watch small companies like Cantora, Man Made Music, and Subpac — experimenting in artist management, sonic identity, partnerships, brand extension, technology, and content delivery — as they begin to redefine the profit model for the industry at large. And for the companies mired in the muck of change, put some real effort into engaging with consumers — the ROI will be gradual but the industry will be a better place for all of us.
