For making music out of the music industry’s data. The music world has become a blur of Spotify streams, iTunes sales, SoundCloud plays, Facebook likes, Wikipedia views, YouTube hits, and Twitter mentions—but what does it all mean? Next Big Sound analyzes the seemingly unending streams of data to explain which bands are about to break, which late-night shows really impact an artist’s trajectory, and many, many other quandaries that for decades couldn’t be quantified. Next Big Sound’s analytics predicted the successes of artists like Iggy Azalea, A$AP Rocky, and Macklemore & Ryan Lewis more than two years before they broke big. In the past year they’ve begun working with companies like Pepsi and American Express to help steer the $1 billion plus being spent each year by brands on music-related marketing and sponsorships. "That’s a lot of money to be changing hands without any real data supporting these decisions," says CEO Alex White. "We believe in the power of data to transform the music business as it has finance, sports and politics before."
For Beyoncé, and the Beyoncé Effect. Beyoncé and her company broke pretty much all the music biz’s album release rules with Beyoncé last December. With no prerelease single, no advance promotion, and no warning, Mrs. Carter dropped the album globally with a simple note on her social media accounts: "Surprise!" The Internet went crazy, she became the top search on Twitter, and, at a time when nobody was supposed to be buying records anymore, Beyoncé sold more than 600,000 copies in three days. The album’s 17 songs all had elaborate accompanying videos, an undertaking made feasible in part by the nontraditional release strategy. "It was a choice of investing in promotion and hype or in the art," says Parkwood GM Lee Anne Callahan-Longo. The industry took notice: More artists are trying creative release strategies—among them, U2, Skrillex, and Kid Cudi in the past year—and many long-held marketing tenets (different release dates in different territories, pushing singles to radio) are finally being questioned. "The same marketing and promotion plans for every release does not work," says Callahan-Longo. "It’s exciting if you’re willing to be brave and take risks. Great content can cut through."
For high-quality streaming people are willing to pay for. Having built a 16-million-strong user base that spans more than 180 countries (including 5 million paid subscribers), the French streaming service finally launched the first volleys of its American invasion this fall. That pits them against Spotify, but U.S. CEO Tyler Goldman doesn’t believe Deezer needs to steal rivals’ customers. "We’re not really competing with other people in the subscription space," he says. "We’re competing with free. Most people don’t pay for music these days because the value of the service isn’t high enough." Deezer has already managed to convince millions to pay for what they once stole in places like Russia, Thailand, and Brazil, where piracy was the norm, in part by focusing on intensely local curation and offering different products in different territories. Its initial foray into the U.S., as part of a bundling partnership with Sonos, brings high-quality, lossless music streaming to audiophiles who’ve been complaining about the thin, tinny sound of other services. A similar partnership with Bose followed, and Goldman says to expect more, including likely a free ad-supported service, in the coming year. "This isn’t a one-size-fits-all service," he says.
For transcending the boundaries of online music. Bop was created to solve a problem: the balkanization of online music. The site, which launched its public beta in December and already has a live app, is a universal platform for searching and sharing music, or as cofounder Shehzad Daredia puts it, "a home for every song on the Internet." Rather than having to toggle between Spotify, YouTube, and Soundcloud, Bop automatically scans users’ subscription services and free online sites to create a seamless listening experience. Playlists can be culled from all these platforms and shared regardless of which services the recipient subscribes to or where they live. The company has struck deals with every major streaming service including Pandora, which enables the Internet radio site’s users to save songs and build playlists without restrictions for the first time. Bop generates some cash by driving traffic to streaming services and download stores, but as Daredia explains, "The ultimate business model will be a data play—not only do we know what’s popular and trending, but also what people like down at the individual level."
For making the concertgoing experience as good as the music on stage. More than an online ticketing agency, Ticketfly is out to radically transform concertgoing. Already adept at mobile ticketing, Ticketfly’s acquisition of Will Call in August enhances its ability to make the entire experience as frictionless as possible. Once the services are fully integrated, a user could open a bar tab, buy merch, upgrade to a VIP package, get himself backstage, and have unreleased music sent to him by the artist he came to see, all with his phone. If one bar is crowded, the app will let you know there’s another one downstairs with no line. When you’re ready to leave, just walk out and your tab will be closed and paid. "I imagine a future where the only thing you need for a concert is your phone," says CEO and cofounder Andrew Dreskin. The reams of data these transactions produce may prove as valuable as the transactions themselves. Ticketfly shares the info with the 1,300+ venues and promoters already on its rolls to help them figure out whose fans buy what and how often.
For wising up your listening. Already dominant in the Wi-Fi speaker market, Sonos’s vision for the future is broader and deeper than just being a convenient way to hear your iTunes collection blasting throughout your house. The $199 PLAY:1 speakers, introduced in late 2013, put Sonos in the price range of more budget-conscious consumers, and new software obviates the need to tether speakers directly to a router. Recent integrations with Google Play and upstart streaming service Deezer allow users to play music directly from those services through Sonos speakers. But the game changer has been the new Sonos mobile app, which enables a universal search of a user’s entire music library and streaming services. While simple in theory, for many it’s made the app not just an easier way to listen to their music, but the only way they listen to their music.
For bringing order to electronic dance music. Since 2012, SFX has gone on an epic spending spree, gobbling up iconic dance clubs (Liv, Story), an online music hub (Beatport), a leading artist management company (TMWRK), two digital marketing outfits (FameHouse, Learned Evolution), a pair of ticketing agencies (PayLogic, ClubTix), and promoters behind some of the world’s largest EDM fests (Tomorrowland, Electric Zoo). The vision? Artists get a one-stop shop for all their needs, brands like MasterCard and Budweiser get what CMO Chris Stephenson calls "a rational, organized way of being able to connect with this audience" on a global scale, and with the recent redesign of Beatport, fans get a single EDM-focused community where they can stream, buy, share, and discuss music and live events, get news, and connect with like-minded friends. A two-hour weekly EDM radio show, the fruits of a partnership with Clear Channel, debuted on Top 40 stations nationwide in August. "The entire ecosystem we’ve been consolidating is really the soundtrack to the technology revolution," says Stephenson. "We’re creating the definitive platform for millennial culture."
For making albums still fun to buy. Ben Blackwell, the head of production for Jack White’s Third Man Records, defines the label’s mission simply: "Create things that don’t exist." Third Man has helped spearhead vinyl’s recent resurgence by offering fans more than just music: Glow-in-the-dark albums, liquid-filled albums, albums that play at multiple speeds. White’s recent Lazaretto, which sports a floating hologram, hidden songs under the center label, and one song with two different intros, set a record by selling over 40,000 vinyl copies its first week, and debuted at No. 1 overall. The company’s sprawling Nashville headquarters include offices, recording studios, rehearsal spaces, a live venue, a warehouse, and a storefront. There's also a "Novelties Lounge" featuring, among other things, the only working 1947 Voice-O-Graph recording booth in the world, which has attracted Neil Young, Willie Nelson, Weezer, and thousands of less-famous folks to plunk down $15 for a 2.5-minute straight-to-vinyl recording. Some dismiss the label’s eccentricities as gimmicks, but it’s engendered uncommon loyalty among fans. As Blackwell puts it, "We’re just trying to get people to pay attention to what we’re doing."
For streaming what you want, even if you don’t know it yet. In three years, Spotify has gone from being an upstart outsider in the U.S. to a dominant force reshaping the entire landscape. Faced with increased competition, this year the streaming giant—which boasts more than more than 15 million paid subscribers and over 60 million active users worldwide—acquired the data-driven music intelligence service The Echo Nest, which provides tools to better understand and cater to users, based not just on what users have listened to in the past, but also when they’ve listened to it. There’s also an increased emphasis on curation. As Charlie Hellman, Spotify’s VP of Product explains, "Our editorial team can see signals in our data that people need a certain type of playlist—maybe it’s a pattern of people falling asleep or waking up to music—and very quickly have experts making playlists for exactly that moment." A new desktop app, currently in beta, incorporates all this and increases the service’s overall speed. "Our goal is a service so well-rounded, that gets to know you so thoroughly, that all your music needs are met within Spotify," says Hellman.
For helping artists and fans get what they want. PledgeMusic’s perpetual insistence that it does "artist-to-fan engagement" and not "crowdfunding" like Kickstarter, long felt like quibbling over semantics. But its recent redesign emphasizes that it's monetizing the creative process, not just its product. Beyond music preorders and a menu of cool merch for pledgers, artists push exclusive updates to their fans, offer unfinished demos, or maybe the chance to visit a recording session. PledgeMusic A&R teams scout for new talent and then, along with each campaign’s project manager, work one-on-one with artists to connect them with producers and mixers, offer advice on manufacturing and shipping, and maximize revenue from the whole process. So far a whopping 90% of the 20,000 campaigns it's launched have met their financial goals, and the site averages $61 per transaction. "I want this process to be the way all music reaches people," says founder and president Benji Rogers. "If PledgeMusic could become the iTunes or Amazon of direct-to-fan but with the data collected belonging to the artists and labels, I’d be a happy man."