[BinaryIdiot]

> This is the same problem Netflix & Amazon have been successful in combating. The answer is to become a content owner by competing with the big labels directly. > All Spotify needs to push the big labels back on their heels is to sign a few top 40 artists of their own

No way that's going to work. Music is VASTLY different from video. In video it takes more time and resources to produce each one and replays are rare. In music everything is super cheap to produce and replays are off the chart.

If Spotify became their own label and signed 100 of the top artists, their old songs are STILL with the previous label and will likely never leave. Spotify still NEEDS those songs or it's SOL.

[hobofan]

> If Spotify became their own label and signed 100 of the top artists, their old songs are STILL with the previous label and will likely never leave. Spotify still NEEDS those songs or it's SOL.

As I pointed out in a sibling comment, I think Netflix actually has the same problem. There is a significant presence of long-running shows that people love to watch on Netflix: Friends, Breaking Bad, Modern Family, How I Met Your Mother, etc.. A big favorite "It's Always Sunny In Philadelphia" just left the catalog - presumably due to the acquisition of FX by Disney - and "Archer" will likely soon follow for the same reason.

A lot of those are not new and people still watch them (either to catch up on a missed cult hit or to rewatch their favorites), and the will continue to do so for the next 10-20 years. As long as that's the case Netflix also has to continue to make deals with the existing rights holders or substantially shift their core offering.

[BinaryIdiot]

> As I pointed out in a sibling comment, I think Netflix actually has the same problem. There is a significant presence of long-running shows that people love to watch on Netflix: Friends, Breaking Bad, Modern Family, How I Met Your Mother, etc..

Is that really true though? As video content gets older it usually gets watched less, becomes cheaper and gets re-aired everywhere it can. Once you watch it many don't re-watch. I'd love to know if there were statistics on this either way!

Music, on the other hand, doesn't show its age nearly as much and old music is constantly replayed even in the latest TV shows and movies. Seems to be music is almost timeless whereas video is not. But, again, I'd love to see some data around these topics to valid (or invalid) what I think to be true.

[wils1245]

I bet it’s different for various niches. Consider young families. Disney absolutely dominates children’s content, and very old content still resonates with kids. My niece and and nephew were obsessed with Toy Story, Finding Dory, Frozen, etc. I bet Disney’s streaming service will be the first one families buy.

[hobofan]

I sadly also don't have any data to support my claims. :/

> As video content gets older it usually gets watched less, becomes cheaper and gets re-aired everywhere it can.

That has been the traditional behavior in scheduled broadcasting, but I'd wager that the lifespan of shows is significantly extended when they are available on-demand. In general, there are probably a lot of social shifts/effects related to video consumption that appeared with Netflix for the first time (e.g. binge watching), each with their own economic effects.

[komali2]

Alternatively, as less people stop listening to the radio, songs from the 70's, 80's, 90's, and eventually the early 2000's will need a venue to be played on.

If less people listen to the radio, AND less people buy music directly through itunes or whatever, the only option the big 3 will have is to work with streaming services.

[pembrook]

But if the majority of plays on Spotify are of the current hit pop songs at any given time, Spotify still has the power even if they don’t own the old songs.

Go look at the most played songs on Spotify of all time. It’s not the Beatles and Michael Jackson’s back catalog. We’re talking Chainsmokers and Imagine Dragons and Ed Sheeran.

[seanmcdirmid]

AmazonPrime’s most played list has more than a few oldies in it, especially around Christmas. The non-young crowd is also much less into new music and crave the older stuff actually. A streaming service can totally survive on those users alone, probably. If I could get it at some discount, I would totally pay for a streaming service that didn’t have any songs made within the last ten years. I could live on songs made in the 60s alone (and that’s way before my time).

[usrusr]

Most played in terms of number of plays, but probably far behind in terms of unique users who actively selected the song at least once?

The catalog deep dive is where streaming services offer unique value, putting a hit on repeat is what people could do just as well by buying the single/licence.

[hbosch]

Well, lets also not forget that Spotify has been slowly steering itself from a pure "music playback tool" to a "music discovery tool", and a trusted one at that. They are heavily promoting things like Discover Weekly, Podcasts, playlists like RapCaviar and their various "n+Moods" and "n+Vibes" playlists.

There was a great article[0] posted here some time ago, I think, that likened the algorithmic discovery "products" of Spotify plus the effortless access to individual songs as creating a sort of thin spread of musical diversity (the auther's e.g. Muzak), generic and accessible enough to be replicated by almost anybody. A great example of this, today, is Cardi B[1] – this is a person who honed her personality through social media and reality TV, linked up with a music camp, and is now the third person in history with her first 3 commercial songs in the Billboard Top 10[2]. Her biggest hit, Bodak Yellow, uses a flow lifted from another rapper named Kodak Black (and she has done this multiple times[3]). The thing is, though, she was groomed to be a hit.

Once Spotify achieves a critical mass of listeners that trust their algorithms, and rely on their tastemakers to deliver fresh music, Spotify could easily slot in musicians that they themselves hold the contracts for. Their pockets are just as deep as a record label, and their listener data is far richer. I have no difficulty imagining that Spotify could replicate a Cardi B-esque pop zeitgeist. "Tastemaking", even if the word makes you cringe, is what will define the winners and losers of the streaming wars. It's why Apple hired away Zane Lowe – an relatively bland DJ personality, but an incredibly gifted ear and a cache of trust – and why Spotify relies more on Playlists and Discovery every day.

Remember, they didn't even have the Beatles until Christmas 2016! That shows a decent picture of how much the majority cares about back catalogues. I don't think it's unreasonable to think that Spotify themselves couldn't produce a top 10 rapper, or a top 10 country singer, or a popular podcast, just based on the level of engagement in their playlists.

0. https://thebaffler.com/salvos/the-problem-with-muzak-pelly

1. https://noisey.vice.com/en_us/article/evpbxj/cardi-bs-bodak-...

2. https://noisey.vice.com/en_us/article/bjyvad/cardi-b-makes-h...

3. https://genius.com/a/how-kodak-black-influenced-cardi-b-s-bo...

[bogomipz]

>"Once Spotify achieves a critical mass of listeners that trust their algorithms, and rely on their tastemakers to deliver fresh music, Spotify could easily slot in musicians that they themselves hold the contracts for."

You mean become a competitor to the 3 labels for whom they depend on for their business? Not a chance. If the labels see them as competitors instead of customers they will pull their card and not renew their licenses.

[hbosch]

I don't see the scales to be tipped as heavily as you're suggesting. Spotify alone can make or break an artist, even a "Big 3" one. If you want listenership, you absolutely need to be on Youtube, Apple or Spotify (or a platform like Soundcloud). There are zero relevant distribution channels for today's young listeners that are not streaming services.

Chance The Rapper is one of the biggest names in hip hop, and a relatively big personality in pop culture as a whole. He's fully independent. He signed an "exclusive" 2-week-long distribution deal with Apple for his last album, Coloring Book. Apple got exclusive streaming rights (for 2 weeks), and the artist got $500,000 cash – not an advance – as well as free marketing via Apple. This is the type of deal and the type of artist that will start changing things for the better.

There is a great report published by stat trackers BuzzAngle Music[0] from the past year. Here are some important numbers:

• Song Consumption for 2017 YTD was up 29.5% over 2016 YTD (1.5 billion song project units in 2017 YTD vs. 1.2 billion song project units in 2016 YTD).

• Audio streams reached 179.8 billion, up 58.5% over 2016 YTD.

• Subscription streams grew 69.3% and accounted for 78.6% of total audio streams in 2017 YTD, up from 73.6% in 2016 YTD.

• Overall album sales were down 13.9% compared to 2016 YTD (74.0 million in 2017 YTD vs. 86.0 million in 2016 YTD).

• Digital album sales in 2017 YTD were down 24.3% over the previous year (34.5 million in 2017 YTD vs. 45.6 million in 2016 YTD).

• Song sales (downloads) in 2017 YTD were down 23.8% compared to 2016 YTD (313.3 million in 2017 YTD vs. 410.9 million in 2016 YTD).

So now say you're a Sony exec and you're looking at these numbers. Can you afford to have ANY of your top talent pulled from Spotify? Consumption and streaming are rising and pure sales are falling. Megastars like Taylor Swift and Ed Sheeran are immune from these trends, basically, but if you want to stay culturally significant you will soon need streaming more than streaming needs you. That's my opinion.

0. http://www.buzzanglemusic.com/us-2017-ytd-report/

[bogomipz]

>"Spotify alone can make or break an artist, ..."

Really? Name one artist that Spotify has broken exclusively.

>"Chance The Rapper is one of the biggest names in hip hop, and a relatively big personality in pop culture as a whole. He's fully independent."

That's great but until there are enough Chance the Rappers Spotify needs the big 3's catalogs.

I'n not sure why you felt compelled to list all those statistics, nobody is suggesting streaming hasn't grown in popularity.

>"Can you afford to have ANY of your top talent pulled from Spotify?" Yes you certainly can. The streaming markets has no shortage of players now - Amazon, Google, Apple, Pandora, Deezer etc. Spotify needs the labels more than they need Spotify.

[hbosch]

>Really? Name one artist that Spotify has broken exclusively.

You're really gonna have to go easy on me and realize I'm using the name Spotify as a means to blanket address all streaming services. Artists break on streaming almost exclusively these days, and I feel like you are with me on that. But in the interest of specific artists:

Spotify's playlist RapCaviar catapulted rapper Lil Uzi Vert from the underground into the stratosphere[0]:

“XO Tour Llif3” also made history on the May 6 Billboard Hot 100 as one of five hip-hop songs in the top 10, only the second time that Billboard’s preeminent chart featured five rap songs (Kendrick Lamar’s “Humble” was No. 1; Lamar’s “DNA” No. 4; Future’s “Mask Off” was No. 5; Kyle’s “iSpy” featuring Lil Yachty No. 6; and “XO Your Llif3” No. 10). Strikingly, these songs were getting little to no airplay on the nation’s hit-driven radio stations, traditionally, along with sales, the most powerful factor in determining a song’s Hot 100 placement. “Let’s be honest,” says a top major-label executive: “No cool kid is listening to top 40 radio.” Instead, those kids are glued to streaming services."

An underground hit on SoundCloud first, and then Spotify single-handedly turned this kid into a superstar. Lil Uzi Vert became one of the hottest rappers of 2017 due to Spotify's featuring of his single on a highly influential in-house playlist.

And more about streaming breaking artists, in general, from the same article:

"And in numbers that sometimes strain belief, users are opening their Spotify or Apple Music apps and streaming hip-hop and R&B tracks at nearly twice the rate as the next most popular genre (rock), according to the research company Nielsen."

>Amazon, Google, Apple, Pandora, Deezer etc. Spotify needs the labels more than they need Spotify.

People don't subscribe for the catalogues. The catalogues between services are so similar as to be completely negligible. If you pull your catalog from one service, you don't hurt the service you hurt yourself – all those subscribers simply won't listen to your music. Those are your customers now, whether you like it not.

I guarantee this is how a conversation goes between two people, one with Apple and one with Spotify, when talking about a new song rising in popularity:

A: Hey, did you hear That New Song by Artist? B: No, is it on Spotify? A: Nope, they are a Sony artist and only on Apple now. B: Oh, okay, have fun.

Artist – That New Song now has 0.5x listenership. Meanwhile, Universal is still streaming on both services and will completely own the charts.

Labels aren't in competition with streamers, they are in competition with each other. If one major pulls their catalogue from 1 of the big streaming services, they will lose any semblance of relevancy as now the other 2 major labels will own all charts and social listening. That's IMO.

0. http://www.vulture.com/2017/09/spotify-rapcaviar-most-influe...

[JohnJamesRambo]

The algorithms of Spotify are what keep me there. I leave but always have to come back, that's how good the Discover Weekly is.

[pc86]

> replays are rare

Tell that to my wife who has seen every Office episode at least 20 times.

[h2onock]

I’ve binge-watched a few series’ through several times.

[BurningFrog]

But in that world any other player would equally NEED Spotify's artists.