0:00

I’m Matt Bellamy founding partner of Puck news and I’m covering the inside conversation about money and power in Hollywood, with my new show, the town I’m going to take you inside Hollywood with exclusive inside on what people in Show, Business are actually talking about multiple times a week.

0:16

I’ll talk to some of the smartest people I know journalists insiders, all of whom can break down the hottest topics and entertainment.

Tell you what’s really going on.

Listen now, Today, the Deep story of a cultural mystery.

0:35

Why does it seem like the old is eating the new in pop culture?

So this year, the song of the summer is very arguably Kate.

Bush’s running up that hill a deal with God.

It was launched by the most-watched Global TV show of the summer, stranger things.

0:53

And in movies, the biggest hit of the season is clearly top gun Maverick something interesting.

About these three titles running up that hill was originally released in 1985.

The original Top Gun came out in 1986, stranger things isn’t a maj The tokens of the 1980s that’s for decades ago.

1:17

So the summer of 2022 has basically been a temple to the 1980s and now maybe you’re thinking Derek, you know, don’t build any Grand Theory from this beware of recency bias, it’s just one summer, but if you keep digging a little bit, you realize the story is clearly deeper than one summer.

1:36

The five biggest movies of this year are in order the second Top Gun the second doctor strange, the 6 Jurassic Park, the 14th, that man related film.

And the fifth Despicable Me, There are obviously a lot of amazing original films being made all the time.

1:55

But as far as slam-dunk Blockbusters go, the last decade has suffered, you could say, from a new movie curse last week, the Wall Street Journal published a review of the new Beyonce album with the Fine.

Can she break the new music curse?

The article pointed out that something truly strange is happening.

2:14

Total consumption of music is up across album, sales track purchases streaming, but listening to new music is down the entire growth in listenership is happening in so-called catalog or older songs.

2:30

Some data from billboard in 2017, catalog, music was 61 percent of total listening in the first half of this year.

It’s 73%.

That’s a tectonic shift.

In a big and controversial article earlier this year, the music critic.

2:48

Ted Gioia wrote, that old music is killing new music.

This wasn’t one of those sleepy turgid.

Oh, kids these days with their hip hop and their tick-tocks, this was a music fan and music historian diving into the data to show that streaming patterns are rapidly rapidly changing.

3:05

And that the music industry is making deliberate choices.

That might be squeezing the life out of new artist.

Today’s guest is Ted Gioia, we talked about his viral, essay is old music, killing new music, the dearth of young stars in Hollywood and the rise of a new kind of risk aversion in American culture and business.

3:28

This is a topic.

I have thought a lot about recently because it’s not just pop culture.

Where old is eating the new the average CEO.

In America has never been older.

The average college president, in America, has never been older, the average age of a senator has never been older.

3:46

The president of the United States is the oldest in American history, and yes, you could say it’s an agent country.

Yes, of course, people are living longer and that’s good.

But something else is happening here.

Something Less benign and more interesting than the mere passage of time.

4:06

And this episode, I hope offers a key piece of the puzzle.

I’m Derek Thompson.

This is plain English.

4:41

Ted, welcome to the podcast thank you for having me.

So you wrote this viral article is old music.

Killing new music.

I want to start right there.

What was your argument?

It’s very interesting when you look at the numbers because there’s a clear Trend going on there, I find it a very disturbing Trend because over time more and more of the music consumption in the United States is tilting towards what they call the catalog.

5:10

These are songs that are the older than 18 months, but in fact, when you dig into it, it seems like in many ways these are songs that are older than 10, 20, 30 years and everything seems to be converging here.

The data now shows that more than 70% of the song streamed, our old songs just a few months ago, he was more like 65 66 percent and so it’s sensing up adding on to that you find that the biggest area of investment in.

5:39

Music is publishing catalogs of older artists.

And when I say older artist, I mean over artist people, older than being, that’s seriously old when you get that.

But we’re talking about musicians in their 80s. 70s, you have, you know, Bob Dylan or Paul Simon.

5:57

People are snatching at these catalogs.

In fact, they’re investing much more in the rights to old music.

The new music that’s never been true before in the history of song.

Unless you go back to the Medieval Era as you go back, a thousand years you might find something similar but right now it’s just off the charts.

6:16

That’s what people want to invest in our the old songs and then finally I’ll just add anecdotally.

Wherever I go I hear old music, you know, I go into a store and the people working in the store are all half my age, but they’re listening to the songs, I grew up with I go into a restaurant.

6:34

Same thing, I asked his server, I said, why are you listening to old songs like this?

And she looked at me in surprise, she said, you know, I like these socks.

I I thought it was like the boss.

I thought there was an octogenarian boss in the back room, that was ordering this.

6:49

But this is just everywhere.

And now you see, you know, recently with these old songs coming back on the charts, you can’t deny it.

The old music is squeezing out the new music.

So listenership is tilting toward older music and investment is tilting toward older music and I’m equally interested in both of these phenomena before we get into why this is happening.

7:10

I love you to tell me how unique this moment is because I think casual fans have always underrated the importance of old music to the music business.

It is always been true.

That catalogs were incredibly lucrative for the labels and the same is true for other media.

By the way, on TV, reruns or lucrative in the book industry, back lists are Lucrative like nine trillion copies of The Great Gatsby and Catcher in the Rye of and sold in high schools like the Bible for Pete’s sake.

7:37

So do we have data in music from like the heydays of CDs or vinyl where we can point to that data and we can say, wow, new music really used to be a bigger deal but now old is eating new.

The data is murky and I’ve tried to dig into getting information that is consistent over a period of decades.

8:01

I have not been able to find that but when you find the patches, if information you see it’s Crystal Clear that the music industry was built all around new songs for decades and you could measure the number of ways you could see what was her on.

8:17

You can see what was on display in a record store.

You could listen to what they were playing on the radio.

You could see what your buddies had when you went to their homes and look through the record collection, you could see who’s concerts were selling out.

There were always at all this.

Canal’s there.

I wish I could synthesize it into some sort of chart of leading indicators but it’s hard to do.

8:39

And in fact, the music industry numbers are more difficult to understand now than ever before because there was a day when they measured sales but there are no sales.

Now when they tell you these are the best-selling songs in the country.

They’re not actually talking about sales or time button, people want you to video or whatever.

8:56

So the data is getting harder to track but I think it’s inescapable Particularly when you see studies year after year.

Now, coming from the same market research groups using the same methodology.

So, for example, if old music was 67% of consumption last year.

9:14

And this year, it’s up to 72, 73 percent.

You can’t really deny the numbers, but I’ll be honest, you try to measure them, they’re not good.

You know, the other thing I’d love to be able to measure is how much money teenagers spend on music.

I have searched for this data everywhere, but I know there was a time.

9:32

I mean, going back to my day, you spent a sizable amount of your budget or your allowance.

I guess that was the word, you use your allowance.

You might spend a third of your allowance on music.

You buying up albums, or whatever.

And now I find talking to teens, I am asking them, do you pay for a streaming subscription?

9:51

Usually they just piggyback on their parents subscription and I’d love to be able to measure, but I think if you found the actual numbers, you would Per capita spending on music of All Sorts, by younger people has collapsed.

So people who listen to this podcast know, I’m obsessed with the idea that if you look at the u.s. box office, all the most popular movies have like a colon, or a number in the title because they’re essentially episodes in a franchise.

10:17

I want to extend this idea of the Superstar effect to music.

I know Music is More splintered, but I wonder if there’s a similar Dynamic, so I looked at best-selling albums of the last decade or is he Pointed out album equivalence, which is basically streaming data that is turned into album.

10:34

Album sales numbers by year here.

The last seven years of best-selling album equivalence in 2015, and 2016, the best selling album was by Adele in 2017.

Pray, 19, and 20 20.

It was Taylor Swift in 2021 again.

10:49

It was Adele, so yes, music has a very long tail.

A gazillion people listen to Drake and Harry Styles, but this really is an unprecedented situation.

If you go back to the 1990s 80s, 70s, 60s never before have two artists dominated like this ever.

11:09

And I wonder in addition to your old is eating the new Dynamic.

Whether you also see a kind of Superstar eats all Dynamic happening in music, I don’t believe, it’s one Superstar squeezing out the other because we’ve seen that before, you know the 80s, everybody loved Michael Jackson and Madonna.

11:27

But still, there were room for other people.

You know, I’m old enough to remember beatlemania.

I mean I was a tiny little top when that happened but it Clips the everything, but still there was room for other folks.

I think there’s a different Dynamic going on here.

I think there are many factors but what I would like to highlight and I think it’s similar in movies and music is this extraordinary risk of adverse Behavior among the businesses involved because you point out that most films nowadays are reboots or sequels or prequels or Spin-offs of various sorts just to be clear.

12:02

It’s the most, it’s the most popular movies that are sequels adaptations, and reboots.

I don’t want my friends who report on the movie business to chide me on this point.

There are a ton of movies being made that are not sequels adaptations in, reboots it, what’s important?

12:19

And what’s interesting is that if you look at the movies that tens of millions of people actually want to see those, don’t tend to be originals and I buy into that 100%.

But I don’t Blame it on the audience because if you look at films at films that have not yet been released, so you can’t even tell right now.

12:38

With the audience is going to say the ones in which the most money has been invested by the studio.

Our sequels prequels reboots remakes and spin-offs.

So I will blame the audience a little bit.

12:54

But I think really, we are living in an environment, both in movies and music and other things as well in which all the money is being pumped in these zombie projects, some something that’s from 10, 20, 30 40, 50 years ago will bring it back to high.

13:10

So they’re spending a fortune on 80 year old Harrison Ford making a new Indiana Jones Movie, they’re spending a fortune to get Tom Cruise back into that bomber.

He had been in since the 1980s.

So I do think you should sniff out the money.

Follow the money, you know, before I got involved in writing about music, I worked Consulting to Sportsman, 500 companies doing this future as stuff.

13:34

And the rule we always had is follow the money.

If you want to understand what’s going on, follow the money and I would say in both movies and music now the investment dollars.

Shaping the audience behavior.

I’m really glad that you said that last point because I think that sometimes when I make descriptive statements about culture like everyone is watching sequels adaptations in reboots when it comes to box office returns.

13:59

They say oh you’re singing that original movies.

Aren’t any good?

And I’m like no no no, I’m not saying that I’m describing the outcome.

I’m telling you what I’m seeing.

I love original movies.

I prefer original movies.

I have seen Michael Clayton 17,000 times.

14:15

I don’t like Marvel that much.

I’m just telling you what people are doing, you mentioned follow the money.

So I think at this point we should probably do just that and follow the money.

There’s something happening behind the scenes in music that I think a lot of casual fans don’t know about which is that a new kind of company or new kind of investment product is specializing today in, buying the catalog to famous artist for Millions, sometimes hundreds of millions of dollars so that they can license those songs for ads and movies.

14:45

Dylan sold, I believe 100% of his catalog for about three hundred million dollars.

Neil Young’s sold, 50% of his career, catalog to a company called hypnosis for 150 million dollars.

Stevie Nicks.

So the majority stake in her songs to a company called primary wave for a hundred million dollars.

15:03

Whitney Houston, David Crosby, Imagine Dragons, The Killers all made these deals.

What are these companies?

Tell me a little about a little bit about these new players and how they’re changing music?

Well there.

Different kinds of players involved in, no matter which one you look at it’s bad news.

15:20

You mention a fun called hypnosis and this is an investment fund that just buys up old songs and they get investors to pump in money and they will just fire up any old song.

They can, they can see and they make promises that they’re going to license.

15:38

These songs are going to show up in TV advertising and TV shows and in movies and elsewhere and they promised Great returns.

And we can ask in a moment whether these returns will actually happen.

I’ll point out, that songs are a depleting asset, and the copyright does expire, at some point and I’ve studied what happens to old songs.

15:58

I went and looked at songs from 80 years ago.

So I actually went back to the hit songs of 1942 and I asked myself what licensing income can you get from any of these?

And the short answer is nothing, you know, nobody wants to hear a song, that’s 80 years old now.

16:15

How about 70 euros over 60 years old?

If you follow the money spent on Elvis memorabilia, Elvis Presley being a good surrogate of the late 50s, early 1960s, it’s collapsing because the Elvis fans are dying, you know, pop culture, people think last forever but it doesn’t.

16:32

I think, yesterday was Bob Hope’s hundredth birthday.

Nobody knows who Bob Hope is, but he was the biggest comedian in the United States, you know, a few decades ago.

So hypnosis is making this Grand claim that they’ll get you enormous returns if you buy old songs, but there’s another side of the story.

16:50

I want to focus on that, disturbs me.

Been more because the other big buyers here are record, labels Universal Music.

Sony these are companies that a few years ago would have put that music in signing new artists and building their careers are not so interested in that anymore.

17:10

And what are these numbers add up to.

Well if you look at last year, five billion dollars was invested in buying up the rights to old songs That’s enormous.

Now, I’d love to be able to tell you how much they’re spending on building careers of younger artists.

17:26

They don’t publish that number, but it’s tiny.

It’s a tiny fraction of that.

Now, what will be the end result of this?

What happens when everybody invests in the past, not the future, I can’t tell you, but I will say, we’re going to find out.

I think we’re already finding out.

17:42

When you see these numbers, I’ve been signing about people.

Listening to the old songs.

It’s simply the obvious.

Point, when that’s where all the money’s, it’s interesting because the headlines Here original piece, is that all music is eating new music.

17:59

What’s more true to me?

Is that Boomer Nostalgia is eating gen Z because it’s not the case that 1930s or eating the 2020s, right?

Like the 1870s aren’t eating 2020s music.

No one’s buying a bunch of Puccini and, you know, investing a billion dollars in Verity operas rather than spending it on the new Hip-Hop star.

18:22

They’re investing in a very particular generational, slice of pop music which is music that was popular between just again, glancing at my list, the late 1960s through the mid-1980s.

I mean to a certain extent you when you have the killers in there as well and Imagine Dragons people are clearly investing in early 2010’s hits as well.

18:43

But would you agree with with my edit?

Their I’m not suggesting that your headline was misleading because you know, this music is But if we’re trying to be as specific as possible about what’s happening, it seems to me that the people with money, whether they are, you know, funds like hypnosis or music players that Universal and Sony, they are reorienting their investment toward Boomer Nostalgia, rather than planting The Garden of the hit makers of the next decade.

19:09

Is that fair?

I don’t disagree with that.

It’s a puzzling phenomenon though.

You know, I’m a boomer myself, but I spend most of my days listening to new music.

So I listened in the course of Any Given Year, all this into more than 1000 newly released albums.

19:25

So far this year I’ve listened to more than 900 albums released in the year 2022.

So I’m very much tied in with new music and actually the music of my generation.

I just peripherally know because when I was coming up I was a jazz musician.

So I sort of blocked out pop culture for many years but I know all those songs, you could not know the songs growing up all that, all that Boomer music.

19:49

So I won’t deny that, but the question is, why is this the case?

Now you could make a maybe you could make the case that Boomer spend more money on music than younger people.

And I do think that might be to ensure is actually buying physical albums or putting.

20:05

They’re the ones paying for the streaming subscriptions, in many households or whatever.

But still that doesn’t make sense.

Because for decades, the music industry was driven by money, spent by young people.

That’s why I get back to this issue of what The kids doing with their allowance and so the boomers are able to control the dialogue on music but everyone else is letting them do that.

20:29

You know what I love is that you are a boomer who listens to a lot of new music and I’m a millennial who just really listens to a lot of old music, you know, Bill Evans and Chet Baker and Jazz.

A lot of classical, a lot of weepy britpop, in the turn of the century.

Like that’s my entire music diet and because I’m a normie and most people stop seeking out new music as they get older.

20:49

Spotify did a study a few years ago, I think where they found that the typical listener stops seeking out new music by like the age of 33 because before my musical tastes in our teens and 20s, and then the sensitive period is over.

And we enter our mid 30s late 30s, which is where I am, and are tasty, basically solidified.

21:09

And by the way, that’s one of the reasons why Spotify invented the program discover weekly, it was to stimulate the dying Instinct of their aging consumer base because they wanted them to find new stuff.

Listen to, but you mention that it’s harder to launch new stars these days, possibly because the music labels have shifted their investment toward older stars.

21:29

Just wanted to point out.

We’re seeing exactly this effect in movies, been Lindbergh and Rob Arthur of the ringer wrote this amazing piece on the rise of older lead actors in blockbuster movies.

So in the year 2000, they found the average age of one of the top two.

21:45

Male actors in a blockbuster film was 37 years old.

Just now in 2022, it’s 50 years old, Tom, Cruise was 24.

When the original Top Gun came out, he still carrying the franchise at 60, and it’s actually become really difficult to namesakes, you know, five, ten star actors, under the age of 30.

22:04

So, tell me a little bit about the similarities that you see between the music phenomenon that we’ve talked about and this movie phenomenon, which is, that lead actors are getting older and older with every passing year.

I think in both instances, there are many factors going on.

22:19

But I want to highlight one, I think it’s very important in both music and movies and almost nobody talks about it, but the problem is originating in the distribution Channel.

Now what do I mean by that?

Well let me tell you about music.

22:35

Then we’ll look at movies in a second but in music now everything is distributed through streaming platforms.

Now, that’s a big change because you go back two decades.

Things were distributed through record stores, Someone would walk into a record store and buy stack albums, or they would download later from the iTunes Store but they would pay money constantly and then somebody got the bright idea that will allow folks to stream as much music as they want for 999 a month.

23:09

This was what we call, collapsing the price of bra.

See that one more time it was collapsing, the price umbrella collapsing.

The price umbrella, okay?

Because generally the umbrella is what holds up the pricing in an industry.

Since I’m using MBA jargon here, the umbrella holds up the prices, everybody’s charging $50, somebody charges 30 and everything clapping, all the competitors have to to to rush to match that.

23:35

So in use, if there was a collapse of the pricing, Ting.

And the interesting thing is it was done without anyone knowing if it was going to work, the whole music industry, jumped on this streaming thing before it proved, it could be profitable.

Spotify was just hey, play this game with us.

23:52

We might big money, we might lose everything.

Able said sure, you know, we’ll we’ll roll the dice.

And what happens is that the profitability in music eroded enormously over the course of the few years now, why am I mentioning this now?

Because what, no, one will tell you is to invest in a new artist.

24:12

Does not present a good return anymore.

In the old days if I invested 510 million in developing a new artist I’d get a nice return.

But after they collapsed the pricing in the distribution Channel, you couldn’t get a good enough return to justify the investment.

24:32

No one will say that to you because if you talk to the CEO of Sony or Universal Music, the last thing they’re going to say is we can’t break the artist angle.

We don’t know how to do it.

They won’t tell you this because it’s embarrassing you write a record label and you can’t launch new artist but that’s the brutal truth.

24:49

They won’t tell you now, let’s look at movies.

Now let’s look at movies is the same thing happening there.

Now, this it’s a very different dynamic because it was covid here in the pandemic and they’re shutting down the theaters and then you have Netflix wanting to get movies out of the theaters and into streaming for the same one price, all-you-can-eat buffet mentality.

25:10

So I would suggest that in both instances, both in movies and music.

It’s hard to justify the financial investment of developing, something new.

So that’s why in both cases, they fall back on the old standby.

25:26

We’ll just live with what we got that sold but you know, Harrison Ford’s going to die.

Someday Tom.

Cruz.

I know these guys seem a more.

I know Indy Jones seems Immortal on the screen but they will go.

Bob Dylan will go Paul.

Simon will go Bruce, Prince Ivan and so we’re in this vicious circle that they have forgotten how to build new artists.

25:48

And now they’re just building on the old, but that’s going to have an unhappy ending.

I don’t see how it can turn.

I think I agree with you about the big picture.

I agree that listeners are shifting toward older music.

I agree that investment is Shifting toward older music.

I agree that risk aversion at the institutional level exists and that it is making it harder to launch.

26:09

New stars in music and in film, or I want to push back on or at least investigate a little bit.

Is well, what about all these newest stars that we see you know, lizzo exists and Bad Bunny?

It’s and Steve Lacey has the number one song in America right now.

26:27

And Doja cat is out there and post Malone.

And I’m looking at the top 20 most popular songs on Spotify.

Right now.

There are a Kate Bush’s there and metallic.

Is there right there, you know, songs that are 30 years old but there’s also a lot of new artists and clearly every year new artists emerged that are the next big thing.

26:48

So what explains that if, if you’re saying it is So called impossible to launch new artist these days, is it simply?

Is it stochastic?

Is it just totally random or what?

Well, let me tell you something.

That once again the music industry will not tell you.

27:08

But here again, I go to the numbers and the numbers.

I’ll point you to now is every year Forbes publishes, a list of the highest-earning musicians in the world and if you go to that list you see all the names you just mentioned.

But here’s the interesting part, if you read the details of the top 10, not one of them made the list from income from music, they had a branding deal or they sold Cosmetics or the endorsed a shoe or they did this that or the other.

27:40

But what does that say?

When the highest-earning musicians in the world have to go outside of music to make their money?

So they Are still stars, there will always be Stars, they were all there on there will always be big names.

27:59

But what you find now is very different than from the past.

In that even for a superstar musician who has reached the top rung?

The side course is the main course.

The side deal is what pays their bills?

28:15

And this has many spin over effects and you see it all the time.

Musicians are looking for endorsement deals constantly.

In the old days, you wouldn’t take the endorsement deal because you would have sold out.

Just the idea of taking the endorsement deal was a negative in front of you have no choice, you have no choice, you need to have your song on some TV commercial or you’re not going to be able to live in the lavish style that a superstar requires.

28:42

So yes, there are stars but you need to once again, dig into the numbers and it and it presents a very ominous picture.

This is one of my favorite wrinkles about the modern history of the music business which That you look back at the 1980s, the concept of selling out was hugely stigmatized like Michael Jackson making a Pepsi commercial was absolutely an estimate, what it meant to be a pop star, and people were Furious.

29:04

And today, you know, whatever Bad Bunny is in a Corona advertisement.

No one cares.

It’s actually kind of cool.

You know, someone does a spot for something on Tick Tock or Instagram whatever.

That’s just them being an influencer.

That’s them making their bread and it’s so interesting to see how sometimes business realities can shape.

29:22

Culture.

When music was the main course of this industry, then selling outside of that main course, seemed unnecessary and therefore stigmatized.

But once the main core shrinks once that you know, 20 pack 20 ounce steak becomes a 2 ounce steak and people have to pull together a lot of other vegetables to make the playful.

29:43

It’s not selling out, it’s getting the necessary Caesar salad in order to be full, right?

You have to get that Cronin deal, you have to get that Instagram deal, you have to get that partnership with Ford.

How you make it to the top of Forbes and so I think again, the cultural attitude that we have to selling out.

29:59

Just so interestingly shaped by the economic reality of the music business itself.

So, I want to lift up here and alert listeners that we are moving from the, what the hell is happening portion of this conversation to the?

30:16

Why the hell is it happening?

Portion of the conversation?

We’ve already circled a few potential explanations for why music listening is Shifting toward older music at the same time that movie stardom is Shifting toward older stars and I just want to lay out some of these reasons.

So number one, let’s just say the obvious America is getting older in the 1970s, the median age was 28 now it’s 38 fewer babies, more old people with money.

30:40

That’s a blunt fact and I think it’s gravitationally pulling culture tour.

Dullness and Nostalgia number to the risk of version.

Doom Loop companies sense that it’s getting harder to launch new stars.

They spend more money on Old stars and franchises, but that has the effect of making it harder to launch new stars.

30:57

You could argue that, that creates sort of a situation like a number three explanation, which is that new stars are just getting harder to launch explanation.

Number four is I want to bring you back in and it deals with technological change.

So in the days of vinyl and cassettes and CD sales, the business of music was all new sales, right?

31:21

But with streaming it’s not about new sales, it’s about recurring revenue for Spotify or apple music, it’s about subscriptions and so this business model isn’t geared around novelty, it’s geared around something else.

Something like stickiness.

It’s Geared around cheating, people attached to the ecosystem and that ecosystem like Spotify.

31:41

For example will always have more old music than new music.

So naturally we should maybe expect that a streaming takes over, it will Orient new listening to Ward music that already exists.

How does that explanation wash with you?

31:57

I think there’s a lot of Truth in it, but I want to point out a dynamic that it’s easy to miss.

If you look at Spotify, Your Apple music and you ask a question.

Who is their most profitable customer what you learn is interesting because it’s very different in the than, in the past.

32:19

I used to be involved in all sorts of business studies.

And businesses always wanted to know more about their customers.

And what you find is that they always rely on heavy users, have users, these were the most devoted music fans.

These were people like me.

32:35

Maybe you, I would buy stacks of albums every week.

I spent a huge amount of my allowance on music and I continued even when I was a poor State College student, I Alec if I had to choose between a meal and buying a new album, I bought the album, you know.

32:54

Yeah.

But Things have changed because screaming, you pay one amount per month in the heavy users are actually beliefs profitable because it’s your Spotify has to pay royalties for all these the most profitable customer for Spotify or apple.

33:15

Music is someone just below or above the level of indifference, they care enough to buy the subscription but they hardly ever use it.

Spotify Apple music.

They actually flourish more on apathy and that’s because the business model.

No longer rewards them for appealing to heavy users.

33:34

It rewards them for getting some apathetic person to sign up for a subscription to hardly going to use.

Do not minimize the importance of that in a culture in which there’s so little interest in new things, Innovation and fresh takes on things that such interesting point and the way that I’m going to try to remember it is, the music industry used to be a bar and now it’s a gym, right?

33:58

At a bar, that is a great analogy, you know.

We want you to sign up for the membership and we don’t want to see you again.

January 1st, you have a New Year’s resolution, you’re gonna work out.

You sign up in the year and he don’t come back.

So, you know, it’s funny, I listen to you talk about the, the history of the music industry and how the music labels have tried to learn what people want to listen to.

34:24

It leads me to my final explanation, explanation number five which is that as the music industry has become more algorithmic and more data driven.

Entertainment itself has moved toward deep familiarity that is to say somewhat differently.

34:41

The more we’ve learned about individual taste.

The more we realize that individual tastes are extremely predisposed toward just we consuming the same thing over and over and over again.

So a quick story.

If you’ll indulge me it’s an anecdote from this book that I wrote a couple years ago called hitmakers, which is a book about the science of hits.

34:59

And this is probably my favorite story that I learned about the music industry.

I hope it’s an apocryphal.

I hope you don’t.

It’s fake.

But when the Billboard Hot 100 came out in the late 1950s, it was kind of a lie because billboard didn’t have hard data on the albums that were being sold or the songs that were being played moment for moment on the radio.

35:22

They had to rely on record store owners and radio stations to report the most bought and most played songs.

But both party is often lied because the labels would nudge them or even bribe them in many.

Cases to plug new songs, the store owners often had this relationship with billboard, where if they had run out of Bruce Springsteen, but they had a high stack of AC/DC.

35:44

They’d say a CDC was selling really well because they wanted that to enter the Billboard charts.

At number one, they could sell out of their inventory.

So this all biased the industry toward churn but in 1991 two things happened.

Number-one billboard replaced, its honor System with hard numbers.

36:01

They started using Point of Sales data from cash registers.

And number two, Also, in 1991 billboard switched to monitoring radio AirPlay through Nielsen.

So now suddenly, this system is data driven, billboard is data driven and overnight, like literally overnight.

36:19

Billboard charts changed very, very dramatically number one, in two ways.

Number one, hip hop and Country surged in the rankings.

And old-fashioned rock-solid began to fade and the suggest that an industry dominated by white guys on the coast hadn’t paid a lot of attention.

36:34

To the music interest of urban minorities or Southern whites.

And so when they started registering actual data, it was like, holy shit.

Hip-hop is way more popular than most people thought.

But number two and this gets to most directly to the points.

We’ve been talking about song, stayed on the charts much longer because the record store owners couldn’t lie anymore to promote churn.

36:55

In fact, the 10 songs that have spent the most time on the Billboard Hot, 100 were all released after 1991, it’s not because the music got better suddenly 1992.

It’s because the system changed the methodology changed.

So that’s the end of that story.

37:12

And the lesson of the story to me is that again as these systems, as the feedback loops for the radio stations and the labels and billboard have gotten more reflective, as it held up a more perfect mirror to audience.

37:28

Tastes the reflection in the mirror, just says play the same.

Hold it’s over.

Over and over.

And in this way, familiarity can eat out novelty and old can replace new.

That’s a great story and it’s very accurate.

But let me add just a little more flavor to it because this is one of the classic examples where you don’t know where you rather be in the frying pan or in the fire.

37:52

Because if you go back to the old days, as you rightly pointed out, the music industry was not data driven, not at all.

In fact, I remember when I got out of Stanford, Business School with an MBA and I started getting very closely involved all through Silicon Valley back at the point, when Silicon Valley was taking off.

38:17

And I dealt with some of the smartest people, they are.

And in general, when you talk to them about the entertainment industry, which was down in Southern California, They mocked it.

And, and what they would tell you is that the quality of people in Silicon Valley, they were five times smarter than the people at the record.

38:37

Labels are the movie studios in Hollywood and there’s a little story, I like to use, I call it the idiot nephew phenomenon, whereas if you want to Apple or Facebook or Google or these Silicon Valley companies, they would always hire the best people they could get if you go down to Movie studios are the record labels Whenever there was an opening, the boss hired, the idiot, nephew okay.

39:02

You nepotism Hollywood runs on nepotism, you know, it’s but you pay a price for this.

You pay a price for not having good people and the what was the price on the old days?

The price was no one did any data research in the music industry.

39:18

And you talk to people and as I got a gut, feel for the music and I could drive you just feel I can feel when it’s here.

And basically, they were justifying their own lack of intellectual rigor.

And then things switch to completely flip flop.

Now, it’s all data driven to the ridiculous point, that algorithms are going to Cheers our music, which is you point out, is going to kill everything, because an algorithm is just a feedback.

39:43

Algorithm only looks at what you like the last week last month last year.

And if they start doing that in entertainment, nothing’s ever going to change.

We’re going to be locked in time now.

Why did that change happen?

This is why this is the story.

Once again, that hasn’t been told is decision-making in music was once done in Hollywood or by record Studios but now it’s all done by tech companies.

40:07

The two most powerful people in music or the CEO of Apple and the see ho goo.

I know that’s painful for people to hear but tech companies in Silicon Valley, ate their lunch.

And they are imposing their data driven approach on the industry.

If you’d left the music industry alone, they would still be shy.

40:26

I got a gut feel for, you know.

So now we’ve moved to this completely data-driven approach run by technocrats.

The bottom line is I don’t think it’s any better for our musical culture in many ways.

I think I would rather go back to the idiot and I’m almost ready to say the idiot.

40:44

Nephew.

He’s the idiot.

Nephew.

You know, needed to sell, Autumn, use it to go out on that expense account dinner.

This portion that podcast will be known as in defense of idiot nephews.

Yes.

40:59

I’m going to write about the idiot nephew at some point I haven’t gotten around the case.

The case for the idiot nephew I want to end with your predictions about the future of music.

You published an absolutely fascinating somewhat dystopian list of predictions about the future of mu of Music at the end of last year, a couple of them I found Just sort of spooky and and interesting, you said a particular phenomenon will emerge.

41:23

We’re listeners, will have new favorite songs but not even care about the name of the artist because those songs will break in modes.

Like, I don’t know, Tick Tock maybe where it will be associated with a meme rather than associated with an individual artist.

41:39

You also said that, you think a lot of new Artistry is going to get its Big Break.

Not from the record labels that are losing.

Their will and desire.

To develop new artist but rather from these web Platforms in this case you know you mentioned that the two most powerful people in music or the CEO of Apple and Google.

41:55

I might argue the most powerful person in music right now is whoever’s holding the lever on The Tick Tock algorithm because it’s just extraordinary the degree to which artists and different artistic movements can be launched by Tick-Tock.

Give me your favorite prediction about the future of mute of Music.

42:13

That’s related to the themes.

We’ve talked about today.

I have a lot of unpleasant unhappy predictions about What takes place when you stop investing in new sounds and audiences begin to lose their grasp of up-and-coming artists.

42:32

And you’ve mentioned a number of them, I really think that you are going to see more and more of situations of people saying, hey, I love this song will who is why?

I don’t know what’s on my workout playlist?

Or is it was accompanying.

A tick tock mean, I was in the background of the TV show but I’m going to give you a happy upbeat prediction number I have studied Musical Innovation over the long haul, my last book was called music, a subversive history and literally I dug into the causes of musical Innovation over the course of four thousand years.

43:03

And what I saw is when you got to a point in history where everything seems static and predictable and nothing changed, something came out of the blue to shake matters up, I could give you dozens of examples in the 1930s.

43:22

The early 1930s music was very tepid, people wanted happy songs because the Great Depression was around and there were these sentimental songs and music really wasn’t as as hip and cool as it could be and then the swing era happened with hot Jazz 1936.

43:40

Everyone switched to this really energetic music that completely changed, all the rules.

The same thing happened in the 1950s, the early 1950s, the record labels were churning out.

Music albums.

You bachelor, pad albums.

Pop singers singing Sweet tunes and they thought they had found the end point but then rock and roll came out and just disrupted everything.

44:06

I think that means there’s going to be something bold.

It’s going to blow our minds.

Just two, three, four years from now.

And it’s going to totally energized audiences.

And here’s the crazy prediction.

I think it’s going to be a return to some of the things from the past, that many people think of disappeared completely like, musicianship or sophisticated songs with harmonic changes or actual virtuosos playing honest-to-god instruments.

44:35

I know people tend to think this has disappeared and will never come back, but this is the most radical thing you could do.

But people on his date, you haven’t played real instruments.

Know what could be more radical than that, a song with more chord changes than composers.

I-i’m not sure if that’s going to be it or something else, but let me tell you this idea that the music industry is going to get into threatened, just stay there, won’t happen.

45:00

Not because of the music industry because it is the idiot nephews that are running it, but something’s going to happen outside of their control, maybe even coming from overseas.

Maybe Out of Africa or Indonesia or wherever.

And there will be something new exciting different and hey we’ll all benefit from that.

45:17

I have one last thesis statement to throw at you which is that when I think about everything we’ve talked about and think about the reasons why in various ways I’m not quite as energized or offended.

As you are about some of the trends in music, I think the way to tie it all together for me is the double-edged sword of technological, abundance.

45:40

Technology is made it.

Easier to make new music.

And as a result it’s made it easier to experiment with new kinds of new music individual artists can release entire albums without having to find someone to play bass and drums and lead guitar.

45:56

But as a result, there’s just so much more of it and because there’s so much more of it.

The economic returns aren’t as high to the next marginal person who decides to put their stuff on Soundcloud or Spotify.

There’s just a super abundance.

46:12

Intensive stuff.

Chasing a finite amount of money.

That means that / artist returns are naturally going to decline.

The second thing about in technological abundance is that we can listen to anything now.

I mean, it’s just remarkable that because of, you know, not just Spotify don’t want to be in the business of, you know, plugging this company.

46:33

But YouTube Apple music.

There’s so many different ways to essentially get a portal to 40 million.

Different songs where you do have to pay any into additional cost for any one song when you have that kind of abundant opportunity, when you can listen to literally everything, most people are going to default to listen to songs.

46:55

They’ve already heard because most of us spend most of our time listening to songs.

We’ve already heard the Ohio State musicologist, David here on I think at one point said, 90% of the time we listen to music.

We’re listening to a song that we’ve already heard.

And so when I think about these two aspects of technological, abundance way, More artists chasing a finite amount of money means fewer returns for artists way more opportunities to listen to, whatever song means that we’re going to default ever.

47:20

So slightly to the familiar, that’s somewhat creates a scenario where in now it doesn’t excuse you know the super investment in back catalogs in a way that squeezes out investment.

New artist is excuse, everything that’s happening but it does somewhat explain it.

I think that’s true, but I’m not quite as pessimistic because I see exactly.

47:42

What you’re saying?

There’s music everywhere.

Thousands of new songs are uploaded online every day.

Nobody could even begin to tap into it, even though I’m a music critic and I listen to new music all the time.

Even, I am not completely on top of what’s Happening, despite devoting enormous amounts of hours into it, and people are confused.

48:02

And what do people do when they’re confused?

Whether two things, one is to go back to the old and familiar and we see that happening.

But I also think this creates an opportunity for Did Guy sighs, you know I have a sub stack home, I call it the honest broker.

48:21

And the basic proposition I have with my readers is I’m going to try to be an honest trusted guide, telling you the truth and pointing you to the way to something that you can support and feel good about.

And I see this everywhere, these trusted guides are emerging not in the mainstream media, but they’ll have a podcast, they’ll have a YouTube channel, some of them have enormous phones down.

48:47

Know you’ll have people with YouTube channels with Million subscribers.

And so what’s going on here?

And I think what’s going on is because it’s so confusing.

People seek out individuals, they can trust.

49:02

Now, what does this mean for music?

I’m going to make a prediction here.

I think it’s interesting but I think it’s absolutely true.

In the future individuals will do, what record labels did in the past. so, I, for example, I go on YouTube, if I have a YouTube channel with 30 million subscribers, I’m a record label.

49:21

At that point, I can identify new artist.

I can promote them.

I can get their music out.

I can cut side.

Details is to get vinyl albums printed if I have to.

But literally someone with a YouTube channel, do everything as a one-person shop that previously took an entire Corporation tie record label to do.

49:44

Now, this has to start happening yet in any meaningful way but it’s beginning to.

So I think you’re going to find Find The Trusted individuals or trusted groups of individuals are going to move to the Forefront of the culture.

They’re going to cut through the noise and they’re going to tell people, hey, you don’t have to listen to the same songs.

50:02

You listen to 5-10 years ago.

I’m going to guide you through this Maze and take you to the good stuff.

I love it.

The democratization of the label.

I love ending on an optimistic note.

Ted thank you so much for covered so much ground.

I really, really appreciate it.

50:18

Thank you.

This was not some fun.

Let’s do it again.

Sometime I’m Derek Thompson.

That was plain English.

Thanks very much to our producer.

Devin manzi, if you have any questions comments ideas for future episodes, please shoot us an email at plain English at Spotify.com.

50:34

That’s plain.

No space English and Spotify.com.

And don’t forget to check out our new beautiful Tik Tok page.

You can find us at plain English underscore.

Yes, that’s it.

Plain English underscore.

50:51

And we’ll see you on the tick-tocks.

Thanks very much.