A very long time ago, I met David Porter, and we talked about music and its future. We talked about streaming and the romance of mixtapes. I wrote about his startup, 8tracks. If it was a great and clever idea, from an entrepreneur who loved music and its nuances. David is one of the good guys, so I rooted for him. Unfortunately, like movies, not all startups have a happy ending. Today, David announced his heart-rending decision to let go of 8tracks. Tomorrow, the music will stop. It is sad. If you want to know why it happened, just read David’s autopsy of his startup journey. It will be easy to blame the economics of the music industry or the growing dominance of Spotify. But in reality, there are more forces at work. David writes eloquently about the hard truths of an on-demand, attention-based entertainment ecosystem:
One could blame “the music industry” for the travails of 8tracks — the path to the grave has been well trodden by many digital music startups these last 20 years. But the challenges run deeper, and I think it’s instructive to consider the perspective of the artist and label. As technology has advanced, the atomic unit of consumption has shifted, from prepayment for consumption of all the songs in an album (the CD), to prepayment for use of a single song (the download), to pay-as-you-go for an individual song (the stream). With each step, the artist (and anyone who represents that artist, like a label) gets paid less and later; with each step, the listener gains more flexibility in paying for and consuming what they want, when they want it.
While the resulting pressure on margins suggests a shift away from the traditional label structure, toward an artist services model, the fact remains that it’s not easy for most artists to generate meaningful revenues through music streaming — particularly as streaming consumption has spread “down the Tail” to DIY artists, independent labels, back catalog at major labels, and even AI-generated music. More than 40,000 tracks are added to Spotify every day, and myriad forms of digital entertainment and information — the rabbit hole of YouTube, games, apps, blogs, newsletters and more — compete for the attention of the youthful demographics that traditionally consume the most music. It’s unsurprising that royalties remain expensive and will continue to increase.
It is not just music. News, movies, television, and photographic organizations are all fighting the same battle. I wrote about it back in 2014, in the context of Buzzfeed:
Media companies are those companies that have our attention — they can be social networks (Twitter), games (Farmville/Zynga or Candy Crush/King.com) or photo-sharing services (Instagram) or a listicles powered flywheel of social attention — BuzzFeed. Like I have said before, they all are basically trying to get us to spend many fractions of our attention on their offerings.
In 2016, I listed the following realities for the contemporary media world:
- Attention is fractionalized. Netflix is killing journalism as much as photos from your aunt on Facebook are. (Read “The Distribution Democracy and the Future of Media.”)
- Attention is not only fractionalized but also highly distributed. (Read “Media, Attention, Etc.“)
- Social media platform algorithms reward attention with more attention.
- There are no monetization tools yet because the advertising industry has been smelling its own orifices.
- Containers of media seem irrelevant.
To recap: The beauty of the network is that you don’t have to go anywhere to find entertainment or buy things. Having a computer in your pocket makes it even more convenient to not go anywhere and have everything come to you.
So media as you know it is over. Move on. Let’s focus on what to do.
The Internet has created so much optionality that the only entities that can make money from attention are those that can aggregate it: Google, Facebook, Instagram, YouTube, Twitter, Spotify, Apple, and even SnapChat.
As for Porter, I know he will be back. Not today. Maybe not tomorrow. But eventually, he will. He can’t help himself!