The "S Factor" — What Apple Lacks In Music

Do you remember the scene in Almost Famous when pre-teen William flips through his older sister’s vinyl album collection?

I flashed on this great scene as I thought about this week’s events.

Apple’s recent iCloud announcement was warmly received by most digital music proponents. In the first couple of days after the announcement the mainstream press fawned over Apple and the iCloud, and Apple stock gained.

That’s not to say that everybody was impressed — there was grumbling from well informed digerati, as well as Apple competitors, that this was much ado about very little. After all, the dissenters argued, Apple still hadn’t rolled out a subscription music play to obliterate the old model of paying for music track by track, album by album.

This all makes for a fun digital debate, but I think both camps miss the musical mark.

While the Apple cloud integration might be the best we have seen so far, it offers no surprises. Your collection remains your collection. You can simply access your music now much more easily. This makes Apple devices more attractive, and that’s smart business for a company still driven by hardware and design, not software and content.

Think about the biggest music fans you know — the people who call themselves music junkies.  Chances are that while they love their devices of choice (classic 160gb iPods, Sonos systems, vintage turntables and vinyl) they still spend the majority of their waking hours engrossed in discovering music. Talk to them at length and they will tell you that they live for that Oh Wow moment of discovery. The perfect moment of surprise.  Surprise with a capital S. Their favorite music story invariably revolves around “the first time they heard or saw Elvis, The Beatles, Springsteen, Nirvana, Wu-Tang, Arcade Fire, etc.”

Music fanatics live for surprises and discovery above everything else. That’s why they are so loyal to the bands, magazines, fanzines, radio stations, and websites of their youth. They’re constantly trying to recapture that moment that young William has, flipping through those albums, in Almost Famous.

I’ll never forget this comment from a Warner Bros. Records co-worker a couple of years back:

“I go to Best Buy to get the music I know I want to buy, but I go to Amoeba a helluva lot more, to get the music that I didn’t know I wanted to buy”

With the iCloud, Apple has made progress on getting you the music you already know you want. But what about discovery?

The battle for the Oh Wow moment of surprise — for the music you didn’t know you wanted, for that elusive “S Factor” rages on.

The Neon Billboard Says 'Brain Drain" — Evan Harrison Departs Music

Evan Harrison, who lead Clear Channel’s digital effort for the last 5 years, was my boss at AOL Music for a good part of my run there. Evan’s good people, and an excellent executive. He taught me many things, and was especially good at working through complex issues and organisations to get things done. Evan was a terrific boss…whip smart, judicious, disciplined and fiercly loyal.

Admist all the Apple noise today, word spread that Evan had landed a new gig at  Billboard/Outdoor Advertising company Van Wagner Communications.

While I’m happy for Evan, and pleased that he landed a senior position so quickly, it is more than a little troubling to see another really solid music advocate exit our industry. This is a guy who loves music, who made me stay through to the final encore of a magical Paul Westerberg show, the night before we had a 8am breakfast scheduled with a crucial brand client.

I hope Evan has a great run in his new job, learns a lot, gets to be creative, makes good money, and comes back to music and media in a few years.

We can’t afford the brain drain to wish for anything else.

Q: Who was the big Cloud winner today? — A: "Yes".

I once worked for a brilliant guy, an artist manager, who when you asked him:  “Should we play Dennver or Salt Lake City?”, would invariably answer: “Yes”.  After a month or so,  I figured out that he wasn’t really distracted, he simply wanted you to figure it out.

So, who exactly had the best day today as Apple announced their iCloud launch?

Was it the labels who finally figured out how to get paid for your whole digital music collection, legally aquired or otherwise?

Was it Apple who patiently slogged their way through the tangled web of major label licensing, and came out the other side with a cloud offering immediately superior to Google’s and Amazon’s, that amplified their iTunes meets Apple device ecosystem?

Or was it the consumer, who for $25 a year instantly upgraded all their IOS devices to stream their music collections without having to tether into their computers, and without the time-suck of sifting through files, device capicity issues, or getting “back” to their devices?

So, the question is — Who was the big winner today?

“Yes”.  Yes, is the answer.

Is Spotify Sean Parker's Atonement For Napster?

Bruce Houghton from Hypebot, recently posted this fascinating Reuters clip featuring Niklas Zennstrom (ex-Kazaa) and Sean Parker (ex-Napster).

 

 

The Final Take: Both Zennstrom and Parker founded companies that dramatically disrupted the  music business. Now, both gentlemen find themselves in legally licensed relationships with the music industry — Zennstrom with RDIO, Parker with Spotify. It’s fascinating to watch and listen to their answers regarding their personal roles and motivations in today’s music landscape.

Saturday Afternoons

For those of you over 30, I want you to remember what it was like to be a teenager on a Saturday afternoon.

Meeting your friends downtown; hanging out, looking for connection.

As a New York kid, I often met my friends at the Tower Records on 4th Street and Broadway. It was always packed — buzzing with music and noise and energy. It had a vibe. Everyone was there. At least everyone I wanted to see.

“When’s the new Bowie coming out? Is Eno producing this one? What does he look like now? Is it gonna be Soul? Punk? What’s Bowie gonna to do next?”

Now, visit any downtown Apple store on a Saturday afternoon.

It is always packed, buzzing with music and noise and energy. It has a vibe. It feels like everyone is there.

When’s the new iPhone 5 coming out?  Is it gonna have an 800 million pixel camera? A bigger screen? An even faster processor? More storage? Will it come out in White??”

Going to an Apple store on a Saturday is a social event.

It’s where virtual morphs into physical. Where solitary surfing turns into camaraderie. The Apple store is where hanging out, caressing potential new toys, and plugging into a vibe come to life…all under the banner of commerce.

How did the migration happen? How did we get from Tower to Apple?

Anyone who tells you they absolutely know, is suspect in my book.

It’s fashionable to point at the bumbling of record label, publishing and RIAA strategies in the wake of Napster. All were really bad. And all were probably small potatoes.

What changed from the 70’s and 80’s when teens would go to a friend’s house to listen to an album to today’s “let’s play YouTube videos while we watch TV and text”, landscape?

I can’t give you the answer with 100% certainty. I’m not smart enough to wrap it all up in one blog post, that’s for sure.

How can you capture the enormity of the Vietnam War, the sexual revolution, Watergate, the mainstreaming of Wall Street, the end of the cold war, globalization — for starters.

Let’s speak in broader terms. Economic, political, and sociological factors all changed radically. The whole world changed profoundly.

Like all my favorite bloggers, I have a theory.

I was a typical teenager  years ago, music was key to my point of view on the issues of the day. It was my teenage identity. It was my badge, and it was my language.  Of course I went to Tower Records on a Saturday afternoon.

Then, amidst all these momentous changes, along came the web.

Technology has become the language of teen life — technology is the teen membership badge. Technology allows teens to connect.

And so they go where they feel most at home, most like themselves — they go to the Apple store.

It's The Data, Stupid.

As word spread about Google launching their cloud music service, despite a lack of label licenses, I thought about these leading companies.

Google, Amazon, Facebook, Apple.

What is it exactly about the music business that attracts these heavyweight companies?

Suddenly, I flashed on James Carville, of all people.

Carville is a democratic political strategist, and is generally credited with focusing Bill Clinton’s 1992 campaign for the presidency around these three statements:

  1. Change vs. more of the same
  2. The economy, stupid
  3. Don’t forget health care

It’s the data, stupid  — I can almost hear Carville drawl it.

For these companies, Music = Data.

Billing pathways, hardware choices, play counts, carrier preferences…the list goes on.

The new music business is all about data.

No matter the angle, data drives the underlying motivations of all the big players:

Apple, still primarily a hardware manufacturer, builds complete experiences around its music products through data control. It’s no coincidence that every iPhone and iPad connects through iTunes.

Amazon, the world’s biggest e-commerce player, encourages you at every turn to supply them with information on your every like, dislike, and product aspiration.

The whole experience of being on Facebook, is a data-sharing exercise.

And of course, now Google. Remember their mission statement:

Google’s mission is to organize the world‘s information and make it universally accessible and useful.

Or in layman’s terms — It’s all About The Data, Stupid.

The WMG Sale & The Coach.

By now, most of you have heard the news that Len Blavatnik and Access Industries have purchased WMG for 3.3 billion dollars.

Stateside, you can read Billboard’s coverage of the sale here, and Edgar Bronfman’s letter to WMG’s employees here.

Meanwhile, The Guardian adds their take complete with some interesting conjencture about EMI, and the European Commission:

Blavatnik’s Access Industries won an auction to buy the company with a friendly bid worth $8.25 a share, in a deal that will immediately trigger expectations that under the fresh ownership, Warner Music will try again to bid for EMI, the fourth-ranked music group under the temporary ownership of Citigroup.

Access Industries will assume Warner Music’s $2bn of debts, and provide about $1bn of equity, to buy out a company that has been controlled by Bronfman and a group of private equity investors since they bought the business back in 2004 from media conglomerate Time Warner for $2.6bn.

The idea is to ensure that the bid does not overload Warner Music with debt, leaving it the headroom to pursue EMI if it desired. However, sources close to Access Industries say that there is no need for Access/Warner to make a move on the British company to justify the purchase price.

Final Take: It’s fashionable to greet these kinds of events with cynicism, especially given the staggering operating losses all the majors have shown over the last few years. Still, I can’t help but flash on the words of  legendary NY Giants football coach Bill Parcells: “You are what your record says you are”.  And, today at least, the record says WMG is worth $3.3 billion dollars.

So He Sez — Steven Tyler & Denis Leary

“I snorted my Porsche. I snorted my plane. I snorted my house in that din of drugs and booze and being lost”. — Steven Tyler, lead singer Aerosmith and American Idol judge.

‘The best pitch I ever heard about cocaine was back in the early eighties. It was a street dealer who followed me down the sidewalk going: I got some great blow man. I got the stuff that killed Belushi.” — Denis Leary, actor and author.

 

This Is a Content War — BLT vs. Toast.

 

Who said these five things?:

1-A station van. Cool in ’71 when hippies carried their pot and guitars in vans… now a soccer mom symbol that defines not cool, drives a van.

2-Radio is on innovation autopilot at a time when, to prosper in the Google/Apple era you need to innovate DAILY. American media is getting beaten by the Phone and Cable companies in terms of innovation.

3-If the excitement in radio is all about the deals, where does that leave the listener who could care less about who owns who. Death by deal is a real possibility as media’s eye is SO far off the content ball, that we simply can’t compete in the Google/Apple era.

4-(Here’s a history of) THE STARS OF RADIO:
50′s- Deejays
60′s- PD’s
70′s- Consultants
80′s- Researchers
90′s- Group Heads
00′s- Bankers

5-We are at the most dramatic crossroad in Media History ….(the) denial and arrogance is frightening. It’s NOT OK…it’s war. You gotta pull out the weapons, kill the denial and start creating content that’ll win on 21st Century terms. The denial and arrogance is deafening. It’s worse in Radio/TV than newspapers where they still think it’s 1935.

If you guessed that it was one of our Silicon Valley digerati brethren, parked safely inside of a VC venture … you would be wrong.

If you guessed it was an anoymous Pandora exec, or one of my new friends at Slacker Radio … you would be wrong.

If you guessed that it might have been the insightful radio consultant Mark Ramsey … now you would be getting warm. Quite warm.

No, Mark didn’t say these five things. Lee Abrams did. But Mark captured them on his blog yesterday, in a brilliant post detailing a recent roundtable he chaired that included Abrams.

Lee Abrams is a legendary, often controversial, terrestrial radio and media consultant. He, arguably, invented the AOR/Album Radio format. Likewise — Z Rock, Radio Disney and the original programming roadmap of XM Radio all were driven by his vision. Most recently he worked for Tribune in the newspaper buusiness, as their chief innovation officer.  You can do your own search and dig deeper into his history.

For now, though, I urge you to read Lee’s “We Are In A Content War” manifesto on Mark’s blog.

You can read the full piece here.

The Final Take: Lee’s comments are as applicable for new media as old media. Deals, data, and technology are all vital; but as Lee says, this is a content war. Content, to my mind, is now the full experience… at the risk of a mundance analogy, I think of it like a great BLT. The platform, interactivity, and social elements are the bread, and the “content” is the bacon, lettuce, tomato. And if you neglect the bacon, lettuce and tomato…what are you left with?

Toast.