What the effect of music streaming is towards consumption and discovery behavior Artists Datta and his team speculated that the decline of iTunes sales reported in the media urged Apple to launch its own streaming service in 2015 (after the data collection period). The results from the study hence support the view that Spotify draws from traditional, ownership-based business models, lending further support to the revenue displacement effect demonstrated by Aguiar and Waldfogel (2015). Permanent, growing negative impact of Spotify adoption on iTunes consumptionĭatta and his team found a permanent, growing negative impact of Spotify adoption on iTunes consumption, which is down by about one-third six months after adoption. With more time spent on streaming services, platforms like Spotify will increasingly become attractive to advertisers who seek an engaged audience to place their ads. This adds to explaining why streaming revenues are climbing: not only are more users switching to access-based streaming models, but their overall music consumption is growing as well. Datta and his team empirically document long-term effects on consumption: even half a year after users adopt Spotify, consumption is up by 50%. The emergence of streaming services has provoked a wide-ranging debate about the benefits and drawbacks of ownership- versus access-based consumption. Herewith the implications from the study for platforms, artists, labels, and consumers of the permanent shifts, documented heretofore, in consumer behavior when users switch to Spotify. Relative to using iTunes, adopting Spotify raises repeat listening for consumers’ best new discoveries, although - consistently with the marginal variety on Spotify being free - lowers repeat listening for the average new discovery relative to non-adopters. The researchers document that adopting Spotify leads to more discovery of highly valued music. The effect of music streaming is clearĪdopting Spotify leads to more discovery of highly valued music It is also associated with a large drop in concentration. Adopting streaming services leads according to the researchers to substantial increases in quantity, variety in any measure, plays of new content, and discovery of new favorites. Achieving quasi-randomization via a matching procedure, they estimate the changes in quantity, variety and new music discovery after adopting a streaming service like Spotify. With a unique panel data set of individual consumers’ listening behavior on digital music platforms, e.g., iTunes and Spotify, Datta and his fellow researchers study the effect of adopting streaming services on individual music consumption. Since Spotify is considered a black sheep by artists like Taylor Swift and Thom Yorke it is time to know what the effect of music streaming is towards consumption and discovery behavior. Title of the study ‘How Consumers’ Adoption of Online Streaming Affects Music Consumption and Discovery’. A few weeks ago I received a working paper from a study performed by Hannes Datta, George Knox and Bastiaan J. Last June, Co-President and Chief Product and Technology Officer Gustav Söderström said that the launch of swipe-to-discover could unite the platform’s various verticals – music, podcasts, and audiobooks – in one place.īruce Houghton is the Founder and Editor of Hypebot and MusicThinkTank, a Senior Advisor at Bandsintown, President of the Skyline Artists Agency, and a professor for the Berklee College Of Music.The effect of music streaming. ![]() As of last year, one in three Spotify users was between 18 and 24, and CEO Daniel Ek told Bloomberg that the company “could be doing better” at appealing to Gen Z. Music discovery via a quick swipe or other methods that encourage skipping to the next track within seconds have often been criticized as constraining songwriters, producers, and performers who may prefer a slow build to the hook or other song structures.įor Spotify, the change is about appealing to younger users. Pros & Cons of TikTok-style music discovery ![]() A new mobile homepage similar to TikTok will allow listeners to swipe vertically through content recommendations with visuals from Canvas’ looping short videos and the GIFs already found alongside some tracks, according to a report from Bloomberg News.
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