The climate for music subscription services has never been more fertile. The options are growing more abundant: Rhapsody, MOG, Deezer, Spotify, Rdio, XBOX Music, Google Play Music All Access (still can’t believe that’s its actual name), Sony Music Unlimited and countless other radio and streaming services. And the environment has shown noticeable growth with more than 230M users currently on these non-traditional music subscription platforms.
To me, this resembles the NYC bodega mystery: there’s a tiny grocery on every corner of Manhattan and each offers pretty much the same thing. How do they ALL stay in business?
The truth for these music services is that not all of them will. But it’s far too early to be taking bets… while it’s true that this kind of music platform has been around even longer than the iTunes store, its exponential growth is demonstrative of a shifting consumer base that is empowered, hyper-connected and demanding.
To better understand how we got here, I sat down with Anu Kirk (Director of Music Services, Sony Network Entertainment). Kirk is pretty much the Yoda of this particular world. Part of a rock band in the late 90’s, he was a part of the team responsible for what was first conceived as the “Super Napster,” then called “Aladdin” (taming the music industry genie so to speak), and finally known as Rhapsody.
At Rhapsody for about 10 years, he then went on to build out the mobile space for MOG – designing and managing MOG’s award-winning iOS and Android apps.
If you look overtime at the major shifts in music consumption (physical to digital, digital to the cloud), Kirk’s always been ahead of the curve. Now, he’s hoping to do the same for Sony Music Unlimited.
We first spoke about a simpler time, 10 or so years ago: When the record labels hesitantly allowed a service like Rhapsody to use their catalogue for the low price of ten million, plus licensing fees… plus the cost of the actual music.
“We use to send interns to bargain bins to buy used CDs in bulk and then literally rip those CDs one by one into our library because the labels didn’t have digital catalogues and weren’t about to provide CDs for us.”
Kirk acknowledged that Rhapsody was a bit ahead of its time. In the early 00’s, consumers were getting used to iPods and making the transition from physical to digital. Owning a record collection (even though the records were now MP3s), felt more secure than what Rhapsody was selling… access.
But by 2010, advances in mobile technology began to change the game yet again.
“MOG came to me with the idea of making music listening social. They wanted to ease discovery by making sharing with friends more intuitive. They wanted radio, they wanted playlists, they wanted recommendations… but they wanted it all digital. I told them, it’s not enough. You need mobile.”
With less space on a mobile phone than on an iPod, the idea of owning a vast digital music library was suddenly awkward. MOG sought to enhance the online/offline experience by delivering a mobile functionality that favored access over storage.
We’ve also heard the anthem: Mobile is social, social is mobile. A mobile culture is one that demonstrates their taste not by what they own, but by what they share. Sharing is now a critical part of most listening services, which has partially helped to solve the next and potentially biggest challenge facing music listeners…
So I have access to billions of songs… what should I listen to?
That’s a big question that Sony Unlimited and many other platforms are trying to answer.
You could search for what you want…
Kirk: “With search, your best case scenario is: Yep, that’s what I wanted. It’s a pretty underwhelming experience.”
Better, you open up your service and to find options already waiting based on what you’ve said you like before.
Kirk: “I like to use the restaurant analogy. You walk into a deli, having no idea what you want … you take a look at the specials board and pow, Tuna Melt. That’s exactly what you wanted and you didn’t know it till then. Strangely enough, I think you’ll enjoy that sandwich even more because you weren’t anticipating it. That’s how a music service should be.”
Best, without asking, your service coordinates and curates your listening experience at all times. Basically, the restaurant knows you’re going to be hungry at a certain time and just sends the tuna melt straight to you.
This past weekend, the Wall Street Journal’s profile of Spotify CEO, Daniel Ek, reported:
“Mr. Ek thinks that the delivery of music will soon evolve to the point that we will not even have to decide what to listen to — our technology will simply know, depending on where we are.”
Kirk agrees: “We want Music Unlimited to have a personality, like a friend that gets to know you on a deeper level and has a POV.”
While he’s looking to the future and working on these advances, he’s also concerned about getting the small things done right, right now. Just yesterday, Music Unlimited announced an update to its iOS App with offline playback and high-quality audio. Music Unlimited boasts a licensed catalog of 20 million songs and the app will offer music in 320kbps AAC high fidelity audio while streaming… the best in the game.
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Music Unlimited is also undercutting its competitors in price point – For a limited time, PlayStation Plus members can buy a 12-month premium subscription for $41.99, a cut of about 65% from the regular rate. Those without a PlayStation Plus membership can pay $60 for the same premium offering, a sum that’s about 50% lower than the industry standard.
And about that PlayStation incentive… we think it’s pointing to further integration between the Sony’s music service and gaming platform. Microsoft has already proven the benefit of getting their music service onto the XBOX and now on the web. But the living room is still a battleground for music services – Music Unlimited could be a major player with PlayStation.
Time will tell who is quicker to adapt to the growing need for better discovery features, a better online/offline experience, and an intuitive “personality.” The race has really just begun, but for Kirk, already knowing the bumps and divets of the track and field will likely make all the difference for Sony.