Music Business

Music And Technology: 4 Disrupters You MUST Pay Attention To

11As the music industry continues its second year of promising recovery following the disruption of the digital marketplace and embraces streaming as the dominant form of music consumption, the question is already being raised – what technology will be the next industry disruptor.


Guest post by Sergey Bludov, Senior Vice President of Media and Entertainment Practice at DataArt

The music industry has marked a second consecutive year of global growth, making it appear that the initial disruptive shock of digitalization has faded. As we move forward into the future, we see the lines between music and technology becoming increasingly blurred as successive waves of innovative technological solutions wash over those lines in almost every aspect of the complex music business ecosystem. Will any one of them be the next big wave of disruption? Let’s take a closer look.


2017 is expected to be the year that major enterprise level blockchains start to be meaningfully used, in other words, the time when this technology “comes of age” and demonstrates compelling use-cases in real world scenarios. Companies including major banks and financial institutions and global tech companies such as IBM are taking dedicated steps beyond mere proof-of-concept. The music industry, in contrast, today remains predominantly inert.

Blockchain-enabled applications would benefit nearly all sectors of the music industry, including in the areas of rights management, licensing and royalty distribution, “smart” paperless tickets, secondary ticket sales, and fan and venue engagement. These changes will disrupt current revenue and digital supply chain models but will be net-positives for the industry and for players who approach blockchain thoughtfully. Startups such as dotBlockchain, Ujo, Mycelia, Zimrii Music, and the UK's Lava, and Vibrate are all working to capitalize on this potential but the progress is currently perceived to be slow. This perception, combined with the music industry’s still nascent understanding of blockchain technology, its potential, and its proper implementation, currently holds back this wave, albeit temporarily.

Earlier this year, Spotify acquired the team behind Mediachain Labs, a New York-based startup that specializes in blockchain. With streaming revenues surging skywards and streaming now accounting for the majority of digital revenue and half of the total recorded music revenue, Spotify’s evident interest in blockchain comes at exactly the right moment to make a material difference in this growing market. The chance of the industry joining hands to revolutionize the entire music landscape might be slim, but the rise of private blockchains in the next few years is highly likely.

Big Data and Predictive Social Intelligence

Images (8)Despite the fact that Big Data has already become an essential part of the music industry, many music industry companies remain unable to effectively analyze and use this information to their advantage. Meanwhile, the analytical sector within the music space is evolving rapidly with new startups popping up every year. The annual startup contest run by Midemlab during the Midem conference has seen SoundCloud, Next Big Sound and The Echo Nest pass through its doors. This year’s contest winner was France's Soundcharts, which tracks charts, playlists, airplay and social media for labels and artists. The French music-analytics firm has now raised $3.1m to expand globally.

Relevant, personalized social engagement and social advocacy is more important to the music industry than ever. The next frontier is developing predictive analytics that can provide insight into consumers’ attitudes and preferences by detecting patterns and associations in unstructured social media data. Warner Music UK’s "streaming-first" sub-label called "Artists To Watch Records", for example, is using sophisticated algorithms to for early detection and discovery of tracks that are starting to heat up.

Many industry experts believe that the effective utilization of Big Data is the key to developing fundamentally new methods for delivering music to consumers and, further, has the potential to create additional revenue streams through targeted advertising and highly personalized song recommendation services.

Virtual Reality

VR promises an immersive music experience that transcends simply listening to a digital download or album from your favorite artist. The question remains, however, if this technology is going to find a wide adoption or remain a limited niche ‘toy’.

12There’s definitely an interest from the industry majors. For example, British startup MelodyVR signed agreements with Warner Music Group, Universal Music Group and most recently Sony Music to co-produce and distribute "revolutionary virtual reality music experiences" featuring artists from the labels' rosters.

Or consider American-based TheWaveVR, another innovative VR startup, which wants to turn the live music experience into something that combines an immersive light show with an interactive gaming experience and a focus on social features.

Earlier this year, Unreal Engine helped deliver an exciting and intimate experience for fans of Chainsmokers, combining popular music, high-end visuals, and real time. Viewers got to see the song differently each time they experienced it through the VR app, which debuted at Sony Music’s Lost in Music event. The Grammy-winning duo teamed with creative agency Ralph and interactive entertainment studio Kuju to use Unreal Engine to build a VR experience around their song “Paris.”

Now that hardware is catching up with demand and technology is maturing, the industry will have to address and solve certain legal constraints, such as ambiguous licensing terms relevant to VR experiences. Given the chance, virtual reality can transform the future of visual entertainment and music concerts.

AI, Chatbots, and Voice Interfaces

Artificial intelligence (AI) is growing exponentially across all industries, transforming the manner in which companies conduct business and even redefining our daily lives. An increasingly large number of music companies are racing to get their software to the next level, including British-based Jukedeck and AI Music, San Francisco's Humtap, Berlin-based Melodrive, and Mountain View-based Groov.AI. Even Google has an AI music research project underway called Magenta, and Sony's Computer Science Laboratories (CSL) in Paris is conducting its own project called Flow Machines.

From film and television background music to video games and possibly even hit pop songs, AI is at the forefront of this new era of machine-driven music composition. In response, some musicians are going so far as to propose a restriction on using their previous recordings and compositions for AI and machine learning purposes. At the same time, other artists realize the creative power of AI and are incorporating it into their work.

The maturing development of cognitive services and voice interfaces will also bring a far more advanced level of chatbots in the near future. These new technologies are being combined in innovative ways. For example, Vinci Smart Headphones from China features an Alexa-style voice-controlled assistant that learns the user’s listening preferences and tracks their activity.

Along with AI, voice recognition has the potential for highly meaningful long-term development. Here, the software, not the hardware, will largely determine success in the market. As voice-controlled technology improves, and companies offer more sophisticated and innovative products to the public, hands-free control for music searching and listening is likely to become a standard for the majority of consumers. Already, consumers are eagerly adopting speaker-based voice assistants, with shipments of Google Home and Amazon Echo speakers expected to climb more than threefold to 24.5 million in 2017, according to a report from VoiceLabs.


The evolving expectations of music consumers and artists are challenging long-standing music industry models and, as discussed above, various technologies are making possible delivery of experiences that — until fairly recently — were the stuff of science-fiction. Many companies (both incumbents and new entrants) are moving aggressively to exploit these new technologies.  These and other factors make it imperative for music companies to stay at the forefront of the technical revolution if they want to beat the competition and, indeed, even just to remain relevant.

Fortunately, music industry players need not solve every problem themselves. There are ample opportunities to partner with technology experts bringing both deep music-industry knowledge and experience in planning, development, and execution of business models that take advantage of the right new technologies at the right time. In this way, music companies are best positioned for success in the evolving music landscape, as it continues to be reshaped by these new waves of technology, as well as the next waves that will surely follow.

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  1. Recovery for the top 1% of artists and the 3 major oligopoly labels in a completely gamed ecosystem.
    How about a “product” to sell for everybody else? What do Independent artists have to sell? Besides T-shirts?

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