Well actually, this is about two C words: consolidation and curation, the two most interesting subtexts of the Apple Music launch. Their WWDC presentation on the new service received mixed reviews, and Apple Music itself came off as a hodgepodge of rehashed and borrowed ideas, which for an Apple product, is kind of shocking.
There has already been plenty of discussion online about the pricing, about the presenters, about Drake's vintage Apple jacket - but what interested me most were the effect Apple's entry into streaming music would have on the overall market, and whether their efforts to bring a human element into music programming would be effective. Here are some thoughts on both.
Let's get one thing out of the way: unlike Spotify, Tidal, Pandora and the rest, and Apple doesn't really NEED to make money off music, they make bales of it off the sales of iPhones, iPads, computers and watches. It's why they've always won in digital music while everyone else is awash in red ink or gone. So it is very likely that they'll "win" this time too, and become the dominant platform for streaming music.
And that sucks.
The currently diverse array of streaming media and download music services is a great thing for consumers! The competition keeps things interesting and moving forward - Apple themselves were pushed into streaming music because they saw iTunes download revenues eroding, their dominant position under threat of collapse. Healthy competition influences not only the end user price point, but also the features and content of the sites, which are all key drivers of user adoption and retention.
So Jimmy Iovine gets onstage and pushes a laughable narrative that the "music industry is a fragmented mess" because of all the different places you need to go to get music. Nobody who's voted for a President since Harry Truman thinks streaming music is confusing. In fact, Apple Music came off as confusing - it's an internet radio station, it's not really playlists, it's a social media play for artists - it didn't click. What was clear was that Apple wants to segue their dominance in the digital music space from downloads to streaming media. And that means some of the current players in that space are inevitably going to get pushed out.
Consolidation is a constant in the music business; consolidation of radio station ownership, of ticketing & live concert venues, of the record labels themselves. It is always good for a handful of people at the top of these corporations who get bundles of money, and bad for employees, artists and fans. There are cost cuts: layoffs, rosters get cleaned, radio formats get changed, stores closed, less creative chances are taken, things are dumbed down, prices to the end consumer creep up. Consolidation in the music industry has done little to no good for artists or consumers The last thing anyone should want is a music industry dominated by any one player.
Of course, Apple Music isn't going to twist arms to get consumers to sign up to their service. But you can be sure that they'll be applying pressure to labels and artists to make Apple Music a success, to get exclusive content that competitors won't have. And let's face it, they are the 800 pound gorilla, they've got the entrenched relationships with artists, labels and consumers, they've got a huge war chest to outspend Spotify on marketing by several orders of magnitude. If you're a major artist about to debut a new single online, who are you going to give it to - Deezer, or Apple Music? This is not a good thing for consumers. And it's not a good thing for artists either, especially independent ones.
Ironically and interestingly, the majors own a big chunk of Spotify. So one would think they would have little interest in helping Apple become dominant in streaming, and negatively impact Spotify, which currently has an 8 billion dollar valuation. They won't put all their eggs in Apple Music's basket, but it is very likely 7 or 8 eggs will end up there. Some artists have equity in Tidal, so some content will go there too. But the real battle will be between Apple Music and Spotify - and let's remember, Spotify doesn't have a thriving consumer electronics business to fund their war, they have to go to investors, and consumers. This war with Apple Music will surely increase Spotify's burn rate - how long before they are bought, rolled into some other offering?
There are many players in the streaming music space right now, and the battle for survival, and dominance, is just beginning. These services will be spending money like drunken sailors to outdo each other. Starting now, smart artists, labels and managers who get this will extract the maximum from these services for exclusive content, in the form of marketing visibility, or money (Drake? 19 million? Really?) For a brief moment, artists and labels will be able to play these services off each other to get more - if they don't blink. Because when this moment is over, and there's one big player, you'll be back to begging for them to put your record on the main pane of their service.
So don't blink. Because after somebody wins this war, we'll all be looking back at this time as the "good old days" of streaming music.
Let's talk old-school record business for a minute: Record stores help break records through instore-play, sale pricing and positioning. Radio breaks records by getting behind a song or band, putting it in heavy rotation, mentioning it on air, & promoting shows by these acts in their market. Streaming music services, however, don't often do any of these things, and are not effective at breaking artists. For all the discussion about the sophisticated recommendation and discovery technology of Spotify and Pandora, we haven't seen them able to pull an artist or track out of the sea of digital noise and get lots of people to pay attention - certainly not with the impact that radio or record stores do regularly. People discover artists via other sources, and then their listening follows on streaming services.
Why is this?
For one, streaming services don't have a financial incentive to "sell" an artist, because they don't get paid incrementally for every play. Download stores get their margin % with every sale of a track, so the more they promote, the more they sell, the more they make. Although they don't really broadcast this fact, streaming services make more money from consumers who subscribe and then don't use the service. They love people who pay their $9.99 and then listen for 1/2 an hour that month. It's a key element of their business model.
Additionally, streaming services use playlists to herd artists into genres or moods, stripping them of their individuality and turning their music into sonic wallpaper. Any identity the artist has, any connection with fans is gained entirely outside the streaming service, usually via gigs, social media, airplay, etc. There are usually bios of artists available somewhere within these services, but the information is usually supplied by an industry source like AllMusic or Rovi, and can be boring or out of date (iTunes isn't really good at this either, and Apple Music is pushing Connect, which seems oblivious of social media, and very much like Ping 2.0 at first glance).
There's a human element missing, someone in the chain who really knows the music, knows what the listener will like. Jimmy Iovine and Eddie Cue took shots at algorithms and playlists used by current services, and it was a fair criticism. Algorithms alone won't deliver the required emotional component to make the listening experience special for listeners.
Remember that scene in the John Cusack/Nick Hornsby flick High Fidelity? "I will now sell five copies of The Three E.P.'s by The Beta Band." A casual listen, an unexpected connection, a store full of people asking "what IS that?" with money in hand, ready to buy - something that happens in physical record stores every day. And how about one of those times when you pull into your driveway, shut off the car and sit there in the dark until a record is over, hoping the DJ will back-announce it so you'll know who the artist is. Streaming music services don't seem designed to deliver this kind of experience.
So Apple Music seems to be making an effort to change that, with a team of "music experts" to handle programming, new relationships with celebrity artists and the hiring of big time DJs, as well as the launch of their own global internet radio station, Beats 1. These moves differentiate Apple Music from other streaming services, at least in theory (one wonders whether Drake's music recommendations are really worth 19 million dollars.) In my lifetime in the record business, the people who knew the most about music, who really loved it, were all weirdos. The nicer the clothes, the shittier the taste in music. If you want 100 million people to sign up for your streaming service, you've got to serve tastes outside the pop mainstream.
If Apple is able to find the magic blend of human expertise and data, Apple Music could be quite compelling. They really can't afford not to.
I sure hope they've hired some weirdos.
If you've made it this far, thanks for reading. These are just my opinions.