Music streaming services like Spotify are watching you.
With the ability to ascertain consumers’ activities based on time of day and type of music, streaming companies know about the granular data of their customers, from when they exercise to when they sleep, said Gigi Johnson.
Johnson, the director of the UCLA Center for Music Innovation, presented her research on playlists and streaming providers during the Mallen Conference in Potsdam, Germany, from Wednesday to Saturday. The conference invites experts from around the world to discuss the economic aspects of the film and entertainment industry. Johnson’s presentation for the Mallen Conference focuses on the effects of playlists and streaming on consumer and creator behavior well as its permeation across many entertainment disciplines, like film.
“I’ve been looking at … (music) marketing, and seeing more and more of that short form type of decision making of how we look to a playlist or a list to make a decision,” Johnson said. “You get used to being prefed choices.”
Johnson, formerly the executive director of the Anderson School of Management’s Entertainment Media Management Institute, initially focused her studies on film, but shifted her research into entertainment more broadly. Her interest in music streaming began after attending a consumer electronics show when she passed a Spotify booth advertising how the company planned to monitor its customers’ behaviors. Taken aback by the amount of detail the company had about its customers, Johnson launched into a two-year ongoing research project.
Johnson said the introduction and increased popularity of streaming is changing the way the music industry operates. Artists and producers must now negotiate a changing business model in which the goal is to get their work onto a preset playlist curated by a third party like Google Play or Spotify. Johnson said streaming allows new artists who may struggle to navigate the politics of the recording industry a better chance to be heard, as record labels and radio stations are no longer the sole third-party curators.
Because customers are now more likely to passively listen to music decided for them by a streaming service’s playlists or radio stations, companies make decisions about what consumers listen to without consumers actively being aware these decisions are made for them, Johnson said. But these types of predetermined decisions apply to more than just music streaming. A Google search for a nearby restaurant or job applications will show a list of choices, effectively making both micro- and macro-life decisions for consumers without them knowing the full extent of their options. Johnson said she wants her research to help industry artists and music listeners by better understanding how streaming services work.
“The more people we can help understand the way things work, the more creators can understand how to make this work for their advantage and not just be a gear in a system they don’t understand,” Johnson said.
Streaming sites have more than just company-curated track lists. While the concept of playlists has been prominent in the music industry for decades in the form of albums or radio stations, the introduction of downloadable music allows consumers to create their own playlists for the first time, said musicology professor Robert Fink. With streaming, however, Fink said the ability to create playlists and simply listen to music comes with strings attached.
“Nobody knows anything about you personally, but you as part of a market can be sliced and diced and tracked much more effectively than ever before,” Fink said.
Fink said one of the major implications of Johnson’s research concerns mood regulation, demonstrated by the mass popularity of playlists titled “Chill” or “Dinner Music.” People are expected to manage their mood in order to be productive members of society, and music has become an increasingly popular to way to motivate people to work out or study.
As streaming services are an ongoing transaction between consumers and their music streaming providers, the providers are training music listeners to rent songs and albums, rather than purchase them. Johnson said music industry professionals believe iTunes is likely to end downloadable music early next year, as it can no longer compete with streaming. Unlike when individuals play CDs or listen to downloaded songs, streaming companies can track exactly when a listener is playing a song, when they stopped playing it, or when they skipped a song. Johnson said with this information, companies can determine what their clientele are doing and present advertisements they believe will be most effective based on that information.
“The utopian thing is that the record companies are now putting all these tools in your hands, they’re like ‘make all the playlists you want.’ The dystopian thing is that they’ll watch you do it,” Fink said. “They’ll track you and they’ll train you and they’ll try to influence how you do it by changing the character of the stream.”
Thorsten Hennig-Thurau, a professor of marketing and media at the University of Münster in Germany and co-chair of the Mallen conference, said Johnson’s work in music is closely intertwined with the film industry. Because music and film streaming services are becoming increasingly popular, Hennig-Thurau said the film industry is also seeing a shift as more and more streaming services like Netflix are producing their own content, while music streaming services are just beginning to work directly with artists, quietly bypassing recording companies. The conference facilitates in-depth discussions about the future of the entertainment industry, including questions about whether or not playlists can be used in movie streaming services, making Johnson’s research invaluable, Hennig-Thurau said.
“She knows the (film industry) pretty well and she also at the same time has this focus where hardly anybody else in the group really has a good and sound understanding,” Hennig-Thurau said. “(She’s) not just another great movie scholar, but in this case somebody who brings in a different perspective, a different background.”