Experience Should Be Everything In 2017

 

2017 is going to be a big year for streaming. Spotify will likely IPO, paid subscribers will pass the 100 million mark in Q1, playlists will boom. 2017 will build upon an upbeat 2016 in which the major labels saw streaming drive total revenue growth. This stirred the interest of big financial institutions, companies that had previously avoided the music industry like the plague. These institutions are now seriously assessing whether the market is finally ready to pay attention to. The implication of all of this is that if Spotify’s IPO is successful, expect a flow of investment into a new wave of streaming services. But if these new services are to have any chance of success they will need to rewrite the rules by putting context and experience at the centre of everything they do.

Why User Experience Often Ends Up On The Back Seat

Putting experience first might sound like truism. Of course, everyone puts user experience first right? Wrong. You may be hard pushed to find many companies that do not say that they put user experience first, but finding companies that genuinely walk the talk is a far harder task. Just in the same way that every tech company worth its salt will say they are innovation companies, only a minority do genuine, dial-moving, innovation. Prioritising user experience is one of those semi-ethereal concepts that may be hard to argue against in principle, but that is much more difficult to actually build a company around. Why? Because the real world gets in the way. In the case of music services ‘the real world’ translates into (in no specific order): catering to rights holders’ requirements, investing in rolling out to new territories, paying out 81% of revenue to rights holders on a cash flow basis, spending on marketing etc.

The distinct advantage that the next generation of streaming services will have is that they will sit on the shoulders of the streaming incumbents’ innovation. Instead of having to learn how to fix stream buffering, drive compelling curation, make streaming on mobile work and define rights holder licenses for freemium, they can take the current state of play as the starting point. They are starting the race half way through and with completely fresh legs. They come into the market without the same tech priorities of the incumbents and also without any of their institutional baggage (baggage that, whether they like it or not, shapes world views and competitive vision).

Streaming Music Is Not Keeping Digital Pace

During the last 5 years, users’ digital experiences have transformed, driven by apps like Snapchat, Instagram and Musical.ly. Video has been at the heart of most of the successful apps, as has interactivity. Music services though have struggled, not only with how to make video work, but also with how to give their offerings a less 2 dimensional feel. They have lagged behind in the bigger race. For all of the undoubted innovation in discovery, recommendation, personalization and programming, the underlying streaming experience has changed remarkably little. We are still fundamentally stuck in the music-collection-as-excel-spreadsheet paradigm. Underneath it all is the same static audio file that resided on the CD and the download. Granted, there have been some major improvements in design (such as high resolution artist images, full screen layouts and strong use of white space). Now though, is the time to apply these design ethics to streaming User Interface (UI) and User Experience (UX).

Successful (non-music) apps are multidimensional, highly visual and often massively social. These are the UX and UI bars against which streaming services should benchmark themselves, not how other streaming services are doing. Of course, a key challenge is that music in not inherently a lean forward, visual experience. Most people want much of their listening time to be lean back, without interruptions. Nonetheless, Vevo and YouTube have shown us that there is massive appetite, at truly global scale, for lean forward, highly social, visual music experiences.

Fixing A Plane Mid-Flight

The streaming incumbents could all do this, but they will be at distinct disadvantage compared to potentially well-funded new entrants. It is no easy task to refit a plane mid-flight. Also, Spotify, Deezer and Napster are built on tech stacks with origins more than a decade old. All have made massive changes to those original tech stacks (Spotify in particular, shifting from a monolithic structure to a modular one) but in essence, all these companies were first built as desktop software providers in an era when Microsoft and Nokia were still technology leaders. They have adapted to become app companies but that change did not come naturally and took a huge amount of organizational discipline and resource. This next market phase will require exactly the same sort of discipline, but more effort and at a time when competition is fiercer and costs are higher.

Streaming Services Need To Know Who They Are Really Competing With

The streaming services might think that they are competing with each other but in reality they are competing in the digital economy as a whole. Their competitors are Snapchat, Instagram and Buzz Feed. Right now, music listening accounts for 36% of consumers’ digital media time but that share is under real threat. Over the course of the millennium, music has relied increasingly on growth in lean back environments and contexts. The rise of listening on the go via MP3 players and then smartphones created more time slots that music could fill, while media multitasking has been another major driver of listening. All of this works well when whatever else is going on does not require the listener to be using their ears. The rise of video is, paradoxically, creating more competition for the user’s ear. Even though we are seeing the 2nd coming of silent cinema with social video captioning, there are many more calls to action for our eyes and ears. Even a Facebook feed 24 months ago would have been something that could in the large be safely viewed in silence. Now it is full of auto playing videos, willing the user to unmute. As soon as s/he does so the music has to stop. On video-native platforms like Snapchat the view is even starker for music. Killing time in the Starbucks queue is now as likely to involve watching a viral video as it is listening to a song.

Thus streaming music has to create a user experience renaissance, not just to keep up with contemporary digital experiences but in order to ensure it does not lose any more share of digital consumers’ consumption time. This is the new problem to fix. The Spotify generation fixed buffering and mobile streaming, the Apple Music generation fixed discovery, the next generation will fix UX. Just as Apple Music and Google Play Music All Access were able to skip the first lap of the race, launching with what Spotify and co took years to develop, so the next generation of streaming services, when they come, will take all of the recent innovation playlists, curation and user data analysis as the blank canvas. Which in turn will force the incumbents to up their game fast. Until then, the streaming incumbents have an opportunity to get ahead else get left behind.

7 thoughts on “Experience Should Be Everything In 2017

  1. I agree with you, unless UMG team will back off from music suicide course, 2017 will be a great streaming year.
    It means Spotifiy, YouTube, AppleMusic, Google, Ammazon, even artists owned TIDAL will work hard on construction of $25B streaming and advertising sarcophagi of $200B music business OBVIOUS TO AN IDIOT! They will get to $25B mark if they work hard and they are lucky by 2025.

    We can convert TODAY 100,000 radio stations and 7 stupefied streamers do discovey based music stores and have $100B music industry by 2020. Google, currently the biggest KILLER of music, would double revenues on $200B music business.

  2. I think this article is way off when it suggests that Streaming services are “competing” with the Digital Economy.
    Far closer to reality, Streaming Music services like Spotify will gain more market penetration and longer duration for average listening, by making it easier for more people to find the music they really like.
    When they accomplish that, whether by Artificial Intelligence or by better discovery programming, they will have become a larger part of lifestyle and culture, and the digital economy will reflect this.

  3. Pingback: Experience Should Be Everything In 2017 – Veille IP

  4. I also disagree that the non-visual user experience puts streaming services at a disadvantage. Even for Millenials and Gen Z (my son is one), music is an important emotional and cultural form of entertainment that co-exists with visual entertainment. Even an old Gen Xer like me didn’t listen to music waiting in line when I was young. I read some sort of thing made out of–gasp–paper!

    Kids didn’t flock to YouTube because they wanted to watch music. They just wanted the free music–first to download, then to create streaming playlists. Now with the rise of Spotify and Apple in the US, the importance of YouTube is waning for artists and labels. Sure there are still fans and trolls who comment, but even they’re not doing it at the rate they used to.

    People of all ages may watch a music video a couple of times, but after that, they’re just listening. They’re too busy watching themselves and their friends. You may say that’s the point: you need to divert their attention back to watching artists. But that’s not going to happen and nor does it have to for streaming to thrive.

  5. Pingback: i-Music - TRENDS: In 2017, Experience Should Be Everything [mark Mulligan]

  6. Great piece Mark. From the extensive research my team and I have done in the last year, I think you’re right on the money. There is definitely white space for visual and social music engagement –a better UX that caters to an active listening experience, resulting in experiential valuation creation for the whole music streaming ecosystem. Especially benefiting artists. The passive listening phenomenon is terrible for artists because it creates friction in the process of a casual listener becoming a true, loyal fan. Fans will lean-in and participate given the ability, and I believe a multi-dimensional, social, visual music streaming experience is the answer.

    This post struck a chord because rooted in why we’ve been building Snapwave (http://snapwave.co) for the last year, as a value-add for subscribers of Spotify, Apple Music and Deezer. People don’t need another streaming service with the same music content – they need a new and compelling way to engage with that content.

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