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This great @benthompson piece on Spotify& #39;s new Podcast Subscription product got me thinking about how stark the differences are for artists and podcasters on their platform, the future of music, and what we value in the creator economy.
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Much has been made (and rightly so) about Spotify& #39;s move to displace listening hours from music content to podcasts and long form content - music carries hefty royalties that destroy profit margins, and podcasts don& #39;t. That& #39;s a thread for another day.
If you missed the news, Spotify announced that Podcasters will be able to sell subscriptions to their premium feeds through the Spotify app (via Anchor).
Spotify is hoping their massive scale + discovery engine will entice lots of podcast creators to jump on board.
Spotify is hoping their massive scale + discovery engine will entice lots of podcast creators to jump on board.
Most of the news around Spotify& #39;s podcast product focused on the basics: offering in-app subscriptions at a lower price point than Apple& #39;s similar (new) offering.
But there is a much bigger story here around aggregators and the creators who supply them, which I want to focus on.
But there is a much bigger story here around aggregators and the creators who supply them, which I want to focus on.
So what stands out to me? Spotify will allow podcasters with an existing subscription base to allow their subscribers to listen in Spotify (via oAuth) while the podcaster maintains 100% control over the subscriber relationship (email, billing).
This is a big deal. Here& #39;s why.
This is a big deal. Here& #39;s why.
First, what is oAuth? At its simplest, oAuth allows account information from one service to be used by another service without exposing the password (via tokens). If you& #39;ve ever seen a modal asking you if app x can take certain actions on your account on app y, you& #39;ve used oAuth.
Leaving the tech aside, this means the content creator (podcaster) gets access to Spotify& #39;s massive scale as a discovery engine for listeners while maintaining complete control of the transactional relationship with their existing subscriber.
The creator is in complete control.
The creator is in complete control.
Podcasts also offer a natural touchpoint for the creator to say "subscribe to me on my site", where music does not.
Because of this, it& #39;s much easier for a podcaster to leverage the discovery engine and drive listeners to their site, where they control the subscription + email.
Because of this, it& #39;s much easier for a podcaster to leverage the discovery engine and drive listeners to their site, where they control the subscription + email.
This is in stark contrast to not just Apple& #39;s new podcast product (where the creator has no means to contact subscribers, and doesn& #39;t own anything) but how aggregators work in general, especially with creators.
Let& #39;s consider the contrast with Spotify& #39;s role for musicians...
Let& #39;s consider the contrast with Spotify& #39;s role for musicians...
As a musician, if you want access to Spotify& #39;s massive discovery engine, you have to do it on their terms:
-You accept a set royalty rate, which means they set the value for your work.
-You cannot create subscriptions elsewhere and allow those listeners to stream on Spotify.
-You accept a set royalty rate, which means they set the value for your work.
-You cannot create subscriptions elsewhere and allow those listeners to stream on Spotify.
To be clear (and fair to Spotify) there is no large streaming platform where the artist can set royalty rates.
What is unique is that podcasters on Spotify can now set the value of their work, sell it externally, maintain control, and still tap into the discovery engine.
What is unique is that podcasters on Spotify can now set the value of their work, sell it externally, maintain control, and still tap into the discovery engine.
Spotify can set these terms because they& #39;re the uber aggregator of music.
They& #39;ve commoditized the song as a format, which makes individual artists disposable.
And as musicians have piled their catalogs onto Spotify chasing reach, the supply of music has become infinite.
They& #39;ve commoditized the song as a format, which makes individual artists disposable.
And as musicians have piled their catalogs onto Spotify chasing reach, the supply of music has become infinite.
Let& #39;s consider this bit by bit. What do I mean by & #39;commoditized the song as a format& #39;?
Ask yourself this - do you REALLY care what shows up in your algorithmic playlists, so long as it sounds a certain way?
Ask yourself this - do you REALLY care what shows up in your algorithmic playlists, so long as it sounds a certain way?
This is the power of massive datasets, collaborative filtering, and near infinite supply.
Once Spotify knows what sounds + artists you like, it becomes very easy to swap one artist out and replace it with another that sounds very similar.
To you, this is just & #39;discovery& #39;.
Once Spotify knows what sounds + artists you like, it becomes very easy to swap one artist out and replace it with another that sounds very similar.
To you, this is just & #39;discovery& #39;.
This produces a flywheel effect. As platform scale increases, more and more content producers jump on the wheel, trying to obtain that ever elusive reach (a massive playlist).
And as more creators (suppliers) jump on, each one becomes more disposable and has less leverage.
And as more creators (suppliers) jump on, each one becomes more disposable and has less leverage.
With all the leverage, the platform is in complete control. Now they can offer you a better chance at exposure in exchange for a lower royalty rate (yes, that& #39;s a real thing), which becomes a speedy race to the bottom for suppliers (artists).
Now let& #39;s tie this back to podcasts.
Now let& #39;s tie this back to podcasts.
Ever notice how Spotify has a & #39;Follow& #39; button for artists, but no Feed of their releases? This isn& #39;t a bug, it& #39;s a feature.
If there was a feed, they& #39;d lose control over exposure. Without a feed, the artist has to pray their song shows up in Release Radar. Often it doesn& #39;t.
If there was a feed, they& #39;d lose control over exposure. Without a feed, the artist has to pray their song shows up in Release Radar. Often it doesn& #39;t.
Ok, simple enough you say - just go to Patreon/Bandcamp and go direct to fan.
Both are great places to sell music, but there& #39;s a big problem: while you own the customer relationship, the customer can& #39;t listen to your music in Spotify& #39;s app, where most of them want to listen.
Both are great places to sell music, but there& #39;s a big problem: while you own the customer relationship, the customer can& #39;t listen to your music in Spotify& #39;s app, where most of them want to listen.
You& #39;re creating a pain point for your most loyal fans. I& #39;ve seen this many times in my own music career - if a song isn& #39;t on Spotify, you& #39;ll be inundated with DMs from people asking why not.
You also have zero access to the discovery engine - a huge loss.
You also have zero access to the discovery engine - a huge loss.
Which brings us back to this Podcast announcement. In their words:
Spotify Chief R&D Officer Gustav Söderström told [Stratechery], âHaving all of audio on Spotify means meeting independent creators on their terms, not ours.â
This is where things get interesting to me.
Spotify Chief R&D Officer Gustav Söderström told [Stratechery], âHaving all of audio on Spotify means meeting independent creators on their terms, not ours.â
This is where things get interesting to me.
If you& #39;re a podcaster, you& #39;re met & #39;on your terms& #39; and can own the subscriber relationship while getting all the benefits of Spotify& #39;s incredible scale and discovery engine.
If you& #39;re an artist, and want to own the DTC relationship via Patreon/Bandcamp, you& #39;re out of luck.
If you& #39;re an artist, and want to own the DTC relationship via Patreon/Bandcamp, you& #39;re out of luck.
To me, this creates some pretty important questions about the future of music on Spotify.
Do artists get this same level of control down the road? If not, why? As a platform that started with music, you& #39;d think artists are the most important creators.
What about Podcasters?...
Do artists get this same level of control down the road? If not, why? As a platform that started with music, you& #39;d think artists are the most important creators.
What about Podcasters?...
A cynic might say this DTC offering will survive for only as long as it takes for Podcasts to become the main driver of listening minutes on the platform. Once music has been pushed out (and margins go https://abs.twimg.com/emoji/v2/... draggable="false" alt="đ" title="Tabelle mit AufwĂ€rtstrend" aria-label="Emoji: Tabelle mit AufwĂ€rtstrend">), the platform will claw back control over the listener relationship.
An important consideration: there& #39;s nothing about music that makes it inherently more disposable than podcasts when aggregated.
Once the algorithm learns what podcasts you like, and has a large enough supply + data set, the same & #39;disposable& #39; dynamics come into play.
Once the algorithm learns what podcasts you like, and has a large enough supply + data set, the same & #39;disposable& #39; dynamics come into play.
My goal with this thread isn& #39;t to criticize Spotify: all of these aggregator dynamics are at play with any large platform like Netflix (more content = each piece becomes more disposable), Amazon (more sellers = easy to swap one for another in your search), and many more.
Spotify is a company full of people who love music, and they happened to build such a massive platform that incredibly powerful aggregator dynamics have kicked in.
What Spotify has done with this news is a great thing. I just hope the same capability makes its way to musicians.
What Spotify has done with this news is a great thing. I just hope the same capability makes its way to musicians.
Rather than criticize, my goal here is merely to get you thinking about what we value in the creator economy, and who has control.
As someone who& #39;s been making music for nearly 15 years, I do hope we remember the value of music in our lives. Right now, it& #39;s unclear if we do.
As someone who& #39;s been making music for nearly 15 years, I do hope we remember the value of music in our lives. Right now, it& #39;s unclear if we do.
If you enjoyed this thread and want to read more in the future, follow me --> @itsdaveedwards
