Beyond Spotify: the experts' vision for the future of music listening

Beyond Spotify: the experts' vision of the future of music listening
Listen to what the music industry has to say

The Top 40 will soon be going through the biggest change in its history when streaming is counted towards a song's chart position.

Every chart change before now has been predominantly about sales: from vinyl to tape to CD and then download, each of these constituted a purchase.

Streaming is, for obvious reasons, a whole different story. The purchase is the subscription and it is then up to the service to divvy those fees up among labels. This means that there will have to be some serious working out as to how many streams are the equivalent of a sale.

The mere fact that it is being considered, though, is a big step towards confirming what many music listeners already know: streaming is the future of music.

Or at least it will be if someone actually creates a model that works.

Cash rules everything around me

Spotify has shown that streaming can be embraced by the masses but there is a problem. If streaming is indeed the future of music, then more money needs to start flowing more freely. The current lack of cash – Spotify is yet to turn a profit – isn't yet stifling innovation but it has left many in the industry scratching their heads as to what to try next.

At the Music 4.5 Music In-App Economy conference in London, we tried to find out what was going to make the money needed to sustain streaming - but to understand what is happening at the moment, you have to go back a few years to see what went wrong.

Martin Kummer, head of digital channels and group marketing at Ministry of Sound, is well versed in how the music landscape has changed, particularly when it comes to mobile as he was once head of music at Vodafone.

Speaking at the event he noted that it was while in the mobile space that he found out first hand what could go wrong with streaming.

"Vodafone 360 and Nokia Comes With Music were streaming services that just didn't work," he said. "It was wrong decisions and arrogance that caused failure."

The reason he offered for the lack of success is an interesting one - both failed to balance the needs of the music listener with those of the big telecommunication companies.

"Nokia wanted people to pay for Comes With Music but as this was taking money away from the telcos and pushing it to the handset manufacturer it all ended in tears. Only Apple has managed to make this work so far."

Skip to today and streaming looks a lot healthier but Kummer believes that much more needs to be done.

"We only have three dominant music services but no viable business model. Spotify is six years in the game and there is still no profit yet," he warned.

The Ministry of Sound has been stung when it comes to streaming, so it is no wonder Kummer is not full of praise for the technology.


Spotify: the king of streaming but where's the profit?

Back in 2013, the dance label launched a lawsuit against Spotify because it felt that the service's playlist features harmed its brand because you could essentially create playlists of Ministry of Sound album tracklists.

At the time, Ministry of Sound chief executive Lohan Presencer said, "After 20 years and more than 50m album sales, the value and creativity in our compilations are self evident... Until now, we've watched Spotify's progress from a distance. But we can no longer remain silent."

An out of court settlement has now been reached between the two companies, with Spotify agreeing to stop the playlists coming up in search.

Kummer didn't comment on the Spotify situation at the time but did admit that the Ministry of Sound will have to do something with streaming services in general in the future.

"We have to work with the Spotifies," he said. "I can't go into more detail but this will happen. We all know that streaming is not going away, so it is coming."

Crosstown traffic

Music isn't just pushing towards streaming as the main way to listen, though, it's gearing more towards mobile devices too.

Marcus Taylor, CEO of Venture Harbour, a digital marketing agency for music and film, says that mobile is by far the fastest growing sector for streaming.

"Mobile adoption within the music industry is growing exponentially. Music news sites are seeing 50% of all traffic coming from mobile, with 25% to streaming clients and artist-own services getting around 22% of traffic," said Taylor.

"We are seeing mobile campaigns massively outperforming our desktop campaigns - people are happier buying things from mobile devices."

Much of the conference was taken up with talk of Spotify and while the streaming site looks like it will rule for some time to come, there are some services happy to chip away at niches and even use Spotify's API to enhance what they are offering.


Spotify's API means brands can add apps to the service, a music opinion aggregator, is one such service that has offered up an app on Spotify, as well as made its service available through Sonos.

Its chief marketing officer, Steve O'Reilly, was upbeat about the future of music, believing that as long as you have a sound product and bigger services are willing to share their APIs then artists and fans will more than benefit.

"There has to be an artist and app relationship," said O'Reilly. "Bands really want to be able to send fans content and that is what can offer.

"We didn't need to reinvent the wheel when it comes to apps, we just made sure we have integration with all the big companies and could make apps within minutes. Access to these APIs made it all possible for us."

Marc Chacksfield

Marc Chacksfield is the Editor In Chief, at DC Thomson. He started out life as a movie writer for numerous (now defunct) magazines and soon found himself online - editing a gaggle of gadget sites, including TechRadar, Digital Camera World and Tom's Guide UK. At Shortlist you'll find him mostly writing about movies and tech, so no change there then.