Who will own the virtual concert space?

2020 will go down as a rough year for many artists, largely because of the income they lost when live ground to a halt. Unfortunately, the live music sector is still going to be disrupted in 2021 and it may take even longer for the sector to return to ‘normal’. In fact, we could see the bottom of the live sector thinned out as the smaller venues, agencies and promoters do not have the access to bridging finance that the bigger players have. So, smaller artists may find the face of live permanently changed for them in a way that larger artists do not. Whatever the outcome, one thing is clear: live music is not going to be the same again, and the innovations in virtual and streamed events are not simply a band-aid to get us through tough times. Instead, they are the foundations for permanent additions to the live music mix. The big unanswered question is, who is going own the live-streamed and virtual concert sector?

Bringing it all together

One of the most important things digital tech does is to bring things together. The smartphone is a perfect example. 20 years ago people switched between phones, calendars, diaries, computers, maps, phones, music players, DVD players etc. Now these are all in one device. Streaming did the same to music, taking radio, retail, music collections and music players and putting them together into one unified experience. Until now, live music was not subject to streaming’s great assimilation process. But COVID-19 changed all that. Live used to be separate because it required logistical assets like buildings, ticketing operations, relationships etc. The last few months have shown us that the virtual live sector can operate entirely independent of the traditional sector’s frameworks – which is one of the reasons so much innovation and experimentation has happened. Sure, lots of the early stuff was scrappy and of patchy quality, but is through mistakes that we learn the right way forward. Thus, we have new companies like Driift emerging to bring a more structured and professional approach to a fast-growing but nascent sector.

Disruption is coming

The big traditional live companies right now may be most concerned about whether the still-dormant venues are looking at the new ticketing models being deployed with the likes of Dice and wondering whether they can rethink their entire way of doing business when they reopen. While that may trigger what could prove to be the biggest-ever shift in the live business, the virtual part of the business is where the money is flowing right now: Melody VR bought pioneering but struggling streaming service Napster, Scooter Braun invested in virtual concert company Wave and Tidal bought seven million dollars’ worth of access into virtual concert ‘space’ Sensorium. Virtual reality (VR) spent much of the last couple of years in the trough of disillusionment but now COVID-19’s catalysing impact may see it starting to crawl onwards and upwards. Prior to COVID-19 VR was a technology searching for a purpose. COVID-19 has created one. This is not to say that all of VR’s prior failings no longer matter – they do – but it at least has a set of music use cases to build on. VR can now realistically aspire to be a meaningful component of the wider virtual event sector.

Streaming+

It is no coincidence that streaming is playing a key role. Nor is it just the smaller streaming services at play – Spotify has built the tech infrastructure for live events, while Apple is introducing artificial reality (AR) into Apple TV+, so it is not too big a leap to assume Apple Music AR experiences will follow. Live was the last major component of the music business that streaming could not reach, and that is all about to change. The value proposition for music fans is clear: why go to multiple different places for all your favourite music experiences when they can all be in one place? Think of it as Streaming+. Whatever the future of live is going to be, we can be certain about one thing: it will never be the same again.

The Meta Trends that Will Shape 2019

MIDiA has just published its annual predictions report. Here are a few highlights.

2018 was another year of change, disruption and transformation across media and technology. Although hyped technologies – VR, blockchain, AI music – failed to meet inflated expectations, concepts such as privacy, voice, emerging markets and peak in the attention economy shaped the evolution of digital content businesses, in a year that was one to remember for subscriptions across all content types. These are some of the meta trends that we think will shape media, brands and tech in 2019 (see the rest of the report for industry specific predictions):

• Privacy as a product: Apple has set out its stall as the defender of consumer privacy as a counter weight to Facebook and Google, whose businesses depend upon selling their consumers’ data to advertisers. The Cambridge Analytica scandal was the start rather than the end. Companies that can – i.e. those that do not depend upon ad revenue – will start to position user privacy as a product differentiator.
• Green as a product: Alphabet could potentially position around environmental issues as it does not depend as centrally on physical distribution or hardware manufacture for its revenue. For all of Apple’s genuinely good green intentions, it fundamentally makes products that require lots of energy to produce, uses often scarce and toxic materials and consumes a lot of energy in everyday use. Meanwhile, Amazon uses excessive packaging and single delivery infrastructure, creating a large carbon footprint. So, we could see fault lines emerge with Alphabet and Facebook positioning around the environment as a counter to Apple and potentially Amazon positioning around privacy.
• The politicisation of brands: Nike’s Colin Kaepernick advert might have been down to cold calculation of its customer base as much as ideology, but what it illustrated was that in today’s increasingly bipartisan world, not taking a position is in itself taking a position. Expect 2019 to see more brands take the step to align themselves with issues that resonate with their user bases.
• The validation of collective experience: The second decade of the millennium has seen the growing success of mobile-centric experiences across social, music, video, games and more. But this has inherently created a world of siloed, personal experiences, of which being locked away in VR headsets was but a natural conclusion. The continued success of live music alongside the rise of esports, pop-up events and meet ups hints at the emotional vacuum that digital experiences can create. Expect 2019 to see the rise of both offline and digital events (e.g. live streaming) that explicitly look to connect people in shared experiences, and to give them the validation of the collective experience – the knowledge that what they experienced truly was something special but equally fleeting.
• Tech major content portfolios: All of the tech majors have been building their content portfolios, each with a different focus. 2019 will be another year of content revenue growth for all four tech majors, but Apple may be the first to take the next step and start productising multi-content subscriptions, even if it starts doing so in baby steps by making Apple original TV shows available as part of an Apple Music subscription.
• Rights disruption: Across all content genres, 2019 will see digital-first companies stretch the boundaries and challenge accepted wisdoms. Whether that be Spotify signing music artists, DAZN securing top tier sports rights, or Facebook acquiring a TV network. These are all very different moves, but they reflect a changing of the guard, with technology companies being able to bring global reach and big budgets to the negotiating table. Expect also more transparency, better reporting and more agile business terms.
• GDPR sacrificial lamb: In 2018 companies thought they got their houses in order for GDPR compliance. Most consumers certainly thought they had, given how many opt in notifications they received in their inboxes.
  However, many companies skirted around the edges of compliance, especially US companies. In 2019 we will see European authorities start to police compliance more sternly. Expect some big sacrificial lambs in 2019 to scare the rest of the marketplace into compliance. They will also aim to educate the world that this is not a European problem, so expect some of those companies to be American. Watch your back Facebook.
• Big data backlash: By now companies have more data, data scientists and data dashboards than they know what to do with. 2019 will see some of the smarter companies start to realise that just because you can track it does not mean that you need to track it. Many companies are beginning to experience data paralysis, confounded by the deluge of data, with management teams unable to decipher the relevance of the analysis put together by their data scientists and BI teams. A simplified, streamlined approach is needed and 2019 will see the start of this.
• Voice, AI, machine learning (and maybe AR) all continue on their path: These otherwise disparate trends are pulled together for the simple reason that they are long-term structural trends that helped shape the digital economy in 2018 and will continue to do so in 2019. Rather than try to over simplify into some single event, we instead back each of these four trends to continue to accelerate in importance and influence. 

For music, video, media, brands and games specific predictions, MIDiA clients can check out our report here. If you are not a client and would like to get access to the report please email arevinth@midiaresearch.com.

Black Friday Offer: Free MIDiA VR Report

Shamelessly jumping on the Black Friday bandwagon we have a great offer for you: sign up to the MIDiA weekly research briefing newsletter today and get a free 18 page VR report: ‘The State Of The VR Nation’.

Just go the MIDiA blog homepage and add your email address in the box ‘SUBSCRIBE TO OUR WEEKLY BRIEFING’ and click ‘Subscribe’.

The weekly research digest brings you all of our latest blog analyses on what’s new in music, video, mobile and paid content.

Here’s the introduction to the report:

Virtual Reality’s Path to Mainstream Entertainment

Virtual Reality’s renaissance has an edge on other technologies: romance. Experiences in virtual reality are being evangelised less as entertainment than as a new era of humanity, giving users previously inconceivable levels of exploration in a safe and inconsequential environment. However, this celebratory narrative deserves some context: 2015 saw the entire global VR market generate $189 million, far removed from Facebook’s $2 billion acquisition of Oculus VR in 2014. Although tech hype cycles are nothing new, with investment and development still so heavily skewed towards the hardware and limited on the content side, there are several flaws in VR’s route to market, not least an overestimation of consumer readiness. The VR industry has fallen into a predicament over its heavy investment in hardware whilst failing to offer enough experiences to make the technology a meaningful proposition for its early audiences.

Companies Mentioned In The Report: Facebook, Fox Innovation Lab, Google, HTC, MelodyVR, MIT, Oculus VR, PlayStation, Samsung, Sega, Skybound Entertainment, Sony, Valve, Wevr, Alphabet, Apple, Facebook, HTC, MTV, Samsung, Snapchat, Universal, YouTube 8i, AltspaceVR, Amazon, Apple, Baobab Studios, Facebook, Felix & Paul Studios, Google, HTC, Jaunt, Lucid Sight, Next VR, Nokia, Oculus, Ogilvy and Mather, RELOAD STUDIOS, Samsung, Sony, Space VR, Take-Two Interactive, Valve, The Virtual Reality Company, VCR, Visionary VR, Walt Disney, Wevr, Within

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