Can Technology Change What Music Gets Produced?

In the old days, when people bought music on CDs, the music industry was focused on making sure a new album had a big opening weekend–kind of like a Hollywood movie. They would make sure the album’s songs were on the radio and on MTV. They would put ads on highway billboards. Maybe you heard the album’s “single” on the radio, and thought it was pretty cool, and then you decided to buy the CD. That happened to me many times back in the 1980s. And for some of those CDs, I got tired of them pretty quickly and I just left them on the shelf. But the music company didn’t care how much I played the CD; they already had my money.

The Internet has changed the music business dramatically. For years now, people have been buying digital downloads of single songs for 99 cents, instead of entire albums. And today, people aren’t even buying the digital download–they’re just renting access to song libraries for a fixed monthly fee. When you sign up for Spotify, each time you listen to a song Spotify pays the record label a fraction of a cent. How could the record label ever make as much money as if you paid 99 cents for the song download? To break even, you’d have to listen to the same song at least 99 times plus.

In a recent study by the Wall Street Journal, data showed that one major record company makes more per year, on average, from paying customers of streaming services (like Spotify) than from the average customer who buys downloads or CDs. How could that be, when almost no one is going to listen to the same song 100 times? Well, think about your life over the last five or ten years. For your most favorite songs, you probably listened to them a lot. And the data shows that’s true. In the Wall Street Journal study, it took 34 months for (anonymous) one indie rock album to make more money from streaming than from sales. Another album, by a male rapper, broke even in four months. And what happens after the breakeven point? People keep streaming their favorite songs, and revenue continues to climb. But album sales only keep going down.

The biggest exception was with pop acts, which tend to rely on lots of advance marketing and get almost all of their sales in the early days. Under the new streaming model, those acts almost all lose money–because they don’t have the kind of staying power where listeners keep listening to them for years. The study concludes that the nature of musical creativity will change:

The lesson for record companies and artists appears to be: making disposable hits may once have been a viable business, but new technology could demand tunes built to last.

On this day, Christmas Eve, I can’t help but think that Christmas songs will do well in the new model, because people listen to them over and over again, year after year.

‘Tis the Season for Creativity

Here in the United States, it is our special holiday season when we celebrate Christmas and the New Year. And there is beauty and joy all around. In these last few weeks, I’ve seen an incredible outpouring of everyday creativity:

  • Visiting a local shrine, I toured a room filled with Christmas trees that had each been decorated by a different nonprofit organization. They were being auctioned to raise money for charity. The decorations were exceptionally creative!
  • On YouTube last week, with my 9-year-old son, I discovered an entirely new domain of creativity: Christmas house decorations where the lights are synchronized to a particular popular song. Check out this display, set to the song “Gangnam Style“.
  • My wife and I have received several extremely creative holiday letters, which describe another family’s events, vacations, and successes over the past year. Many of these are produced as “newsletters” with professional-quality layout and design. (Check out this one on Pinterest.)
  • In my local town center of Belleville Illinois, we recently had a Gingerbread House competition. The winners are displayed in storefront windows facing Main Street. Check out this awesome best in show winner.

I love the holiday season, with its wonderful outpouring of human creativity. It demonstrates that each one of us has the potential to make wonderful things. Many of my blog posts are about the famous creators: Jackson Pollock, Albert Einstein, Steve Jobs. But I deeply believe that creativity is something that we all share.

This is my holiday wish: May you find joy in the beauty of human creativity, on display everywhere this holiday season. And may you continue to find wonderful creativity in 2013.

The Creation of Christmas

The Christmas holiday that we celebrate today was created through an emergent, collaborative, distributed process. The same process that generates almost all radical innovation.

Christmas wasn’t widely celebrated in the United States until the late 19th century. The reason is that most U.S. Christians were Protestants and many of them associated Christmas with pagan rituals (like the Christmas tree and the yule log), and worse, they associated it with the raucous practice of “wassailing”: roving bands of adults who went from door to door, singing in the expectation of getting a drink of alcoholic punch from the host. If they didn’t get any punch, they often vandalized the house–think of trick or treat for drunks.

The first step towards bringing Christmas back into the mainstream of American life was Charles Dickens’ 1843 A Christmas Carol. In 1863, cartoonist Thomas Nast first sketched Santa Claus as a fat, jolly man. In Europe, Father Christmas and St. Nicholas were dramatically different from today’s Santa. In England, Father Christmas did not give gifts; in many other European countries, it was the Christ Child delivered gifts to the young.

Santa Claus was a collective cultural creation, in response to the tension between commercialism and domestic family love. In the 19th century, U.S. parents made toys for their children, but as families moved off the farm and into cities to take jobs in factories, they didn’t have time to make toys themselves. At the same time, a toy industry emerged in the U.S., with all of the commercialism and marketing associated with it. Parents started buying presents for their children, but felt vaguely guilty about it. The solution? A new myth: all of the toys were lovingly hand made by happy elves at the North Pole.

There’s a lot more to the story, and it’s not hard to find on the Internet or in books by historians. It’s a process of social emergence over time, of collective creative responses to changes in the U.S. family, society, and culture. The innovative process of social emergence over time is what I describe in my 2007 book Group Genius if you’d like to see more examples of the same historical process of social emergence in action.

Merry Christmas and a Happy New Year!