GETTING SNEAKY DOWN UNDER: As reported in the attached Engadget link, Spotify is launching a new standalone app called Stations which provides a free, radio-style online listening experience. This may sound just like Pandora’s core product, because well, it is. In an attempt to compete for the non-subscriber streaming listener Spotify is testing the copycat service in Australia right now. Ironically Stations’ own description says . . . “finding the right thing to play can feel like a challenge. With Stations, you can listen immediately, and switching stations is simple and seamless — no searching or typing needed.” That seems like some ironic double-speak from the streamer whose primary business model is on-demand playlists. So why go through the trouble to create a whole new app instead of making it a product option the way Pandora does? For the answer just follow the money. Right now all of Spotify’s sub listening is covered under more expense label-direct licensing agreements. But online radio listening, without on-demand or playlisting, can be covered under certain countries’ compulsory royalty decrees. And the per song compulsory royalties average less than half the label direct rates. Right now only three countries have the compulsory setup – the United States, New Zealand, and . . . wait for it . . . Australia. So while this may be billed a cool new app in the test phase, it might actually be a way for Spotify to game the royalties system and pay less for content. Sneaky move, mate!
SATELLITE OVER THE INTERNET? Over the last several years SiriusXM has been like the slow and steady tortoise in the audio race. You don’t hear as much about them while the broadcasters, streamers, and labels battle it out, but they quietly grow their subscription base and revenue every quarter. Now that may change. On yesterday’s earnings call CEO Jim Meyer offered a glimpse into the future of Sirius, as summarized in the attached Inside Radio link. The headline is that Sirius intends to expand into the connected home via the internet. That’s right – internet delivery of satellite content into the growing connected home market via a Sirius app. It’s an unusual move, but it could be a brilliant one. Over 90% of Sirius listening happens in the car, so the connected home is a huge untapped opportunity for them. And as we know, music listening on in-home IoT connected devices is the hottest thing in audio right now. Worth keeping an eye on.
YOU DON’T KNOW DILLY DILLY: Finally today, I want to give you a funny albeit surprising example of the power of sonic symbols. It’s the story behind the term-of-the-moment “Dilly Dilly!”, which you’ve undoubtedly seen in Bud Light’s current TV ads. How the phrase came to be is explained in the attached Seattle Times link. The power of the phrase, and its surprising viral amplification, has caught even the creators at Wieden + Kennedy off guard. That’s because the term was thrown in by chance at the end of the creative process, and literally means nothing more than “hear, hear”. So why has it become so popular that you’re starting to see Starbucks baristas donning Dilly Dilly tees? Because it’s crossed over from being a phrase and is now a sonic symbol. It’s sort of like the que for a joke you’re in on, even though there isn’t really a joke or a punch line. By breaking through the cultural zeitgeist with a sonic symbol Bud Light has captured marketing lightening in a bottle. It reminds me of their Frogs “Bud-Weis-Er” creative from Super Bowl XXIX in 1995. Fortunately for us, goofy medieval Dilly Dilly scenes are funnier than three CGI frogs making weird noises.
Have a Dilly Dilly Thursday guys!
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