In her latest digital column for Music Week, Deviate Digital CEO Sammy Andrews looks at the latest plays from big tech companies from Facebook to Netflix – and what they might mean for the global music business…
I’ve been absolutely blown away to learn how many of you are reading this little column of mine. I’ve received messages from folks all over the globe, in all manner of jobs in the music, entertainment and tech industries, so thank you for reading.
So, with this broad view in mind, I want to have a wider look at some big plays taking place in the entertainment industry right now and what that means for the music business.
There are some notable expansions from some of the world’s biggest entertainment companies going on right now, including Spotify betting big on spoken word; Netflix getting into gaming; Apple venturing (further) into finance; Facebook going large on original content; Instagram getting into retail; and, perhaps one of the biggest stories with the potentially widest impact for the world, Facebook rolling out cryptocurrency (Libra) backed by a host of organisations, including Spotify.
On the face of it, these may all seem like fairly obvious routes for these companies. Indeed, the fact it’s taken Spotify so long to get into spoken word amazes those of us that have been delivering it from our artists for years. But I’d argue that all of this has the potential for quite profound impact on our industry.
So firstly, Spotify. Many of the plays here have a lot to do with how consumption methods have changed. I don’t know many kids who flock to Amazon to buy books outside of education, but I know plenty who download and listen to audiobooks and podcasts, regularly. With a smartphone in everyone’s pocket, it’s a chance for us to build engagement and connections outside of the music itself (and more content to advertise against). We’re working on several at Deviate at the moment that will likely hit your ears in 2020, but we are hearing from Spotify that right now music has yet to fully embrace the idea or thrive there. Time to up your game folks! There’s so much potential here and I can’t wait to see what the industry brings. I’m also sure Spotify is looking forward to the revenue and users it’ll no doubt bring in.
Instagram going big on shopping functionality is another huge opportunity for the music industry. Again, there’s been a seismic change in behaviour when it comes to buying habits. I advise a couple of clothing brands on their digital and some are shifting upwards of 80% of stock directly from their Instagram feeds, and at serious volume. You only need to look at the numerous failing High Street brands to see the wider impact of digital sales, yet so many artists and labels are missing a trick there.
As for Netflix and gaming, it makes absolute sense that they’re rolling into this with content they own, in the same way major film studios always have. Those of us working heritage acts know the impact and offers available there right now, but imagine if a biopic or documentary extended further than the screen...
Facebook and its associated companies are making so many plays right now I can’t fit them all in here, but some interesting ones for music specifically are the long form video, original content and cryptocurrency strategies. There are many interesting conversations happening around original content there and, parallel to that, comes huge potential for advertising (this applies to IGTV also).
Video on demand advertising plays a big part in the money we spend at Deviate Digital for clients, allowing us to reach the right people without needing the crippling budget required for traditional TV. I don’t know many folks (of any age) that watch live TV anymore, do you?
And finally... Libra. The new cryptocurrency from Facebook. Many of you know I am a blockchain advocate, but this for me is potentially one of the biggest stories in the world right now. Spotify backing it makes complete sense and Daniel Ek’s comments on reaching folks without traditional bank accounts resonate greatly with me, given the 15 years I’ve spent working digital with charities in developing markets, and knowing the power that phones and payment solutions have there.
Whether this is the start of a huge blockchain shift remains to be seen, but I can assure you Libra’s rollout has profound potential to change payments, delivery and rights solutions as we know them.
Interesting times ahead…