SXSW is in full gear right now in Austin. As both a Texan and a music fan, SXSW holds a special place for me (and I’m sad to be missing out on the magic). Jazz Fest in New Orleans is the only thing I’ve experienced that seems to come close to the same magic, and I say that as someone who has been to around 20 different music festivals.
What makes SXSW so unique and great isn’t the headliners. In many ways, those have been an unwelcome recent addition to the affair. SXSW is about the undiscovered talent – undiscovered by you, undiscovered by me, and undiscovered by the major labels.
SXSW attracts some of the most ardent music fans. I would spend hours researching artists, sampling their music, and building out my schedule for four days of morning-to-night music taking place at every concert hall, BBQ joint and hotdog stand within walking distance of the Driskill.
Fortunately I came of age in an era when technology made all that considerably easier than it was in the early days of SXSW. My first concert was in 1993 so by the time I was allowed in most of the 6th Street establishments unaccompanied by a parent, MP3s had put almost all the world’s music at my fingertips.
Digital technologies (and of course word-of-mouth) helped me to create a hit-list of artists to “check out,” but it wasn’t until I had the chance to see them live that I ever really felt like I had discovered something. I hadn’t connected yet with the music, but that concert experience, shared with the artists and audience alike, would lay the foundation for a very real and strong emotional connection.
That’s what’s lacking from digital music services today. There is no shared experience, and no algorithm (yet) can account for music’s emotional effect because it depends to a large extent on the interior world of the listener. Two people can experience the same music in very different way (as is true of words) but when we experience it together in a similar way, it forms a connection between us.
That’s what I think attracted so many people to Turntable.fm, however short-lived. Turntable.fm recreated in the digital space the shared experience that’s lost when we “play alone together” on social media. The desire for that emotional, shared experience is also driving the boom in music festivals.
Even radio offers some form of shared experience when a song comes on in the car and you can sing along (or wriggle and dance) with the other passengers, and radio remains the dominant form of music discovery. Live music, however, plays an indispensable role that goes under-reported in survey responses.
Somewhere around 20-30% of Americans attend a concert in a given year but concerts (and festivals included) account for almost half of music spending. Extend that to other sources of revenue such as recorded music and merchandising, and I suspect you will see a classic 80/20 split – 20% of the population accounting for 80% the spending.
These passionate fans are the influencers. They’re the mavens telling all their friends about their favorite new band, the hipsters who wear their knowledge of indie artists like a badge of honor. Only 12% of survey respondents may self report discovering new music at live concerts and festivals, but they’re also sharing their discoveries with the 45% of respondents who discover music through friends and family.
That’s why Pandora’s purchase of Ticketfly makes sense and why Spotify should consider buying and fully integrating Songkick. Ticket sales as a means of monetizing music realigns the incentives of musicians and streaming services and gets everyone playing on the same team again.
Streams are just a way of advertising the “product” – much like in the Earbits model – but the premium product for which people have already demonstrated a significant willingness to pay is that emotional experience of dancing to your favorite band and with your best friends.