The next music war is about to break out

Today’s news often allows us to see predict the future. The next major music war will take place between two different systems: in one corner is Spotify, which has just announced a four hundred million dollar financing round, with the participation of Goldman Sachs and the Abu Dhabi Sovereign Wealth Fund, among others, and that puts the value of the company at 8.4 billion dollars.

In the other corner is Apple, which is preparing the upcoming launch, possibly using a new name and image, of Beats Music, the company founded by US rapper Dr. Dre, which it bought for three billion dollars in May 2014, and that will involve the leadership of the great Trent Reznor, the controversial lead singer of Nine Inch Nails, who has proved to have extremely interesting ideas on the future of music. The relaunch hopes to attract a number of top-40 artists like Taylor Swift — who last November withdrew her catalogue from Spotify — to provide their music exclusively.

Both are offering unlimited music in return for a monthly payment. But while unlike Spotify, Apple seems to be trying to attract the most popular artists of the day on an exclusive basis. This approach could give it greater traction, thanks in part to its excellent marketing, but that could also end up being a problem, encouraging something that both sides are still aware of: unauthorized downloads.

Music is now pretty much available all the time, from a range of sources. Even until a couple of decades ago, the only to listen to music was either by buying records, tapes, and then CDs, or by listening to the radio or watching the television. But now, anybody, anywhere on the planet, using any number of devices, can access just about any kind of music, either by paying for it, or for free.

YouTube, Spotify, or if you want to own it by looking for it on The Pirate Bay. This has led to some users preferring to pay platforms like Spotify to give them immediate access, and those who simply look for music wherever they can find it.

Spotify argues that, more than any other music service, it has helped to prevent unauthorized downloading, pointing to the country it was first available in, Sweden, where it is now hugely popular, and where, correspondingly, there has been a sharp fall in accessing music from P2P sites.

But Apple is hoping that as users see that growing numbers of artists remove their music from Spotify, its appeal will wane, and they will be less inclined to pay for its premium service, on which it relies to make money.

When a superstar like Taylor Swift quits Spotify, despite Daniel Ek’s insistence on how much it has paid out to record labels over the last decade, obviously a large number of users are going to question whether paying for the service. Which prompts the question as to what might happen if more top ranking artists join Swift and offere their music exclusively to Apple.

The music war is about to break out. On one side, Spotify, promoting the economy of abundance. On the other, Apple and its exclusivity and the economy of scarcity. And in middle, the same old story.

(En español, aquí)