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The History of Streaming Music · Stuff You Should Know

• 0:01
  Speaker 1: Welcome to stuff you should know, a production of iHeartRadio.
• 0:11
  Speaker 2: Hey, and welcome to the podcast. I'm Josh and there's
• 0:13
  Speaker 2: chalk and it's just us streaming along merrily on our way, right, yeah,
• 0:21
  Speaker 2: how it goes. This is off to a terrible, terrible start.
• 0:26
  Speaker 2: Life is but a dream? Right, Yeah, but aren't they
• 0:29
  Speaker 2: talking about a stream.
• 0:30
  Speaker 3: Merrily, merrily and merrily ringer on the rosies pocket little No.
• 0:35
  Speaker 2: No, that's not it. That's about like the Black Death
• 0:39
  Speaker 2: or something.
• 0:39
  Speaker 3: Yeah, let's just move on.
• 0:41
  Speaker 2: Okay. So we're talking today about streaming music. That's why
• 0:44
  Speaker 2: I made that joke. I should make scare quotes for joke.
• 0:48
  Speaker 2: We're talking about streaming music, the history of it, and
• 0:51
  Speaker 2: I love this, Chuck, this is a great idea of yours.
• 0:53
  Speaker 2: Was this your idea? Listeners suggested idea.
• 0:56
  Speaker 3: No, this is just me. I was maybe waxing philosophic
• 0:59
  Speaker 3: about I'm wearing with somebody, and then I was like,
• 1:02
  Speaker 3: that would be kind of a fun episode.
• 1:04
  Speaker 2: Well, you were right. And one of the things I
• 1:06
  Speaker 2: love about this is this is history, like world changing
• 1:09
  Speaker 2: history that we lived through and not like as kids,
• 1:13
  Speaker 2: like this happened very much in like our adult lives.
• 1:17
  Speaker 3: You know, Oh, yeah, for sure, just a seismic shift
• 1:21
  Speaker 3: in how music was released and consumed and the finances
• 1:26
  Speaker 3: around it. And yeah, I thought it was super fascinating
• 1:30
  Speaker 3: that there was a point in history not so long
• 1:33
  Speaker 3: ago where people were spending a lot of money comparatively
• 1:37
  Speaker 3: on buying CDs and physical media until they just said,
• 1:41
  Speaker 3: you know what, I'm going to buy music anymore. I
• 1:44
  Speaker 3: want it. I want it for free, like screw all
• 1:46
  Speaker 3: those musicians and trying to make a living.
• 1:49
  Speaker 2: Yeah, pretty much. And it's not so the musicians were
• 1:53
  Speaker 2: caught in the middle. It was the labels that were
• 1:55
  Speaker 2: the greedy fat cats that pushed it too far because
• 1:59
  Speaker 2: it didn't matter whether it was the clunkiest album or
• 2:03
  Speaker 2: the best that Richard Marx had to offer, both ends
• 2:06
  Speaker 2: of the spectrum. You were paying nineteen ninety nine for
• 2:10
  Speaker 2: that thing, whether you liked it or not.
• 2:12
  Speaker 3: Was that how much they were?
• 2:14
  Speaker 2: Yes, absolutely, I don't remember being that much. Yeah, they
• 2:18
  Speaker 2: definitely were. I think they got down toward the end
• 2:21
  Speaker 2: in maybe the twelve ninety nine fifteen dollars range, that's
• 2:24
  Speaker 2: what I remember. They were very much nineteen ninety nine.
• 2:26
  Speaker 2: For a while, you paid it was like twenty bucks
• 2:28
  Speaker 2: of CD like that was a birthday present, right there?
• 2:31
  Speaker 3: One CD YAO who initially fought the big fight and
• 2:35
  Speaker 3: refused to release a record unless it was I can't
• 2:38
  Speaker 3: remember how much it was, but it was quite a
• 2:40
  Speaker 3: bit less.
• 2:42
  Speaker 2: Who Tom Petty baby Man, what a cool dude.
• 2:46
  Speaker 3: Yeah, RP.
• 2:47
  Speaker 2: So, like you said, people just kind of got tired
• 2:49
  Speaker 2: of overpaying. But at the same time, this was a
• 2:51
  Speaker 2: time where frequently albums were released where no one, even
• 2:56
  Speaker 2: the band probably thought that more than one or two
• 2:58
  Speaker 2: songs were worth The rest were just crud. What you
• 3:05
  Speaker 2: didn't get burned time and time again buying an album
• 3:08
  Speaker 2: and being like, I only like the two songs I
• 3:10
  Speaker 2: heard on the radio. Everything else on this album is terrible.
• 3:13
  Speaker 3: No, I was a little different. I wasn't a singles guy.
• 3:16
  Speaker 3: I never bought a singles that was always an album guy, right,
• 3:21
  Speaker 3: And so I would buy albums that were good and
• 3:23
  Speaker 3: not albums that had one good song.
• 3:25
  Speaker 2: But if that's that's what I'm saying, you didn't know
• 3:28
  Speaker 2: how good or bad the other songs were until you
• 3:30
  Speaker 2: got the album because you only had heard the one
• 3:34
  Speaker 2: good song on the radio. So you would hope, hope,
• 3:36
  Speaker 2: hope that the rest of the album was as good
• 3:38
  Speaker 2: as the song on the radio, and it never was.
• 3:40
  Speaker 2: There was like an avalanche of difference between the quality
• 3:44
  Speaker 2: of how good the radio song was and how bad
• 3:47
  Speaker 2: all the other songs on the album would be. That
• 3:49
  Speaker 2: was my experience, at least.
• 3:50
  Speaker 3: Well, I didn't follow as prey to it, I think
• 3:52
  Speaker 3: because and I'm not like some snob or anything, but
• 3:56
  Speaker 3: most of the albums that I would actually invest in
• 3:59
  Speaker 3: buying because you know, I had a limited amount of money,
• 4:02
  Speaker 3: we're like good, really great bands.
• 4:05
  Speaker 2: Okay, whatever, let's move on. I think we've missed one
• 4:08
  Speaker 2: of our famous stumbling blocks. I'll stick with my guns,
• 4:12
  Speaker 2: you stick with yours.
• 4:13
  Speaker 3: Well, I just didn't have the kind of dough to
• 4:14
  Speaker 3: be like, Ooh, I like that song, I'll get that album.
• 4:16
  Speaker 3: I like had to really know it was awesome.
• 4:18
  Speaker 2: I didn't either, and that's why I hated it so
• 4:21
  Speaker 2: much that I'm still upset about it today. Maybe I
• 4:24
  Speaker 2: was better at it, Yes you were. I think that's
• 4:27
  Speaker 2: ultimately the point you're driving. I'm glad you just came
• 4:29
  Speaker 2: out and say it.
• 4:31
  Speaker 3: So everything changed from the big Heyday leading up to
• 4:35
  Speaker 3: the nineteen nineties into the two thousand's when a teenager
• 4:41
  Speaker 3: from Massachusetts, a hacker named Sean Fanning, got together with
• 4:47
  Speaker 3: a finance partner named Sean Parker, who would later go
• 4:50
  Speaker 3: on to be the very famously the first president of Facebook,
• 4:55
  Speaker 3: got together and said, Hey, we got this new thing.
• 4:58
  Speaker 3: It's a file software. It's a peer to peer thing,
• 5:03
  Speaker 3: so you can get music for free, basically by trading
• 5:07
  Speaker 3: it with your friends. And initially it was just I
• 5:09
  Speaker 3: believe Sean Fanning was like, I just want to trade
• 5:11
  Speaker 3: music with my friends who live on the other side
• 5:13
  Speaker 3: of the country. Then they realized they could get investors
• 5:16
  Speaker 3: make it into a real business, and that was Napster.
• 5:20
  Speaker 2: Yeah. And one of the other things that was required
• 5:22
  Speaker 2: for this to work were CD ripping program software that
• 5:26
  Speaker 2: came out around the same time, where you could put
• 5:28
  Speaker 2: in a factory made, label produced CD and rip all
• 5:33
  Speaker 2: the music from it and turn it into MP three's.
• 5:36
  Speaker 2: As you did that time and time again, your MP
• 5:38
  Speaker 2: three collection would build up, and when you installed Napster,
• 5:42
  Speaker 2: it would find all those MP three's and then you
• 5:44
  Speaker 2: could trade them with other people like you were saying,
• 5:47
  Speaker 2: And it was such a hit, Chuck, that within two years.
• 5:52
  Speaker 2: We'll talk about Napster shutting down. It only lived for
• 5:54
  Speaker 2: two years. Originally, by the end of two years it
• 5:57
  Speaker 2: had something like fifty seven million users in.
• 6:01
  Speaker 3: Two years, Yeah, I saw eighty million.
• 6:04
  Speaker 2: That's I believe it. That it was sensational and the
• 6:08
  Speaker 2: idea that it was a teenager that not only introduced
• 6:11
  Speaker 2: this to the world but completely changed the way that
• 6:14
  Speaker 2: music is made is just satisfying but also just mind
• 6:18
  Speaker 2: boggling because things have been done a certain way for
• 6:20
  Speaker 2: so long and the labels were so in control. The
• 6:24
  Speaker 2: idea of this guy coming along, it's like the original disruption.
• 6:28
  Speaker 3: Yeah, at the peak of Napster there were twenty seven
• 6:33
  Speaker 3: billion transfers per month song transfers, So it's just incredible.
• 6:40
  Speaker 3: And this is another great stat that LVIA found at
• 6:43
  Speaker 3: one point supposedly sixty one percent of all traffic on
• 6:48
  Speaker 3: college servers were people sharing MP three's.
• 6:51
  Speaker 2: Totally by that too, man. So, like we said, musicians
• 6:55
  Speaker 2: mostly got caught in the middle of this. It was
• 6:57
  Speaker 2: the labels that were really taking the hit, and some
• 7:00
  Speaker 2: musicians are like, this is great, this is a great
• 7:02
  Speaker 2: way to spread music and awareness. Chuck d was very
• 7:05
  Speaker 2: famous a proponent of it early on, but there were
• 7:09
  Speaker 2: also the exact opposite. Some artists were like, to heck
• 7:13
  Speaker 2: with that. I think it was a famous quote from
• 7:15
  Speaker 2: Doctor dre And he ended up joining Metallica, A and
• 7:20
  Speaker 2: M Records, the RIAA and started filing suits against Napster,
• 7:24
  Speaker 2: and some of them, including the RIAA and Doctor Drake,
• 7:28
  Speaker 2: started suing Napster users, that is, their fans for pirting
• 7:34
  Speaker 2: their music, like suing them directly personally individually.
• 7:38
  Speaker 3: Yeah, they went after them under the Rico Act, the
• 7:41
  Speaker 3: Racketeering Act. Metallica was specifically seeking ten million bucks. And
• 7:48
  Speaker 3: what they didn't realize was this was, you know, this
• 7:51
  Speaker 3: was an online thing, so you could get another software
• 7:55
  Speaker 3: program like if you know. What they ended up doing
• 7:57
  Speaker 3: was they ended up getting a list of more than
• 7:59
  Speaker 3: three hundred thousand in it's like three hundred and thirty
• 8:01
  Speaker 3: something thousand who had shared Metallica's music and got Napster
• 8:07
  Speaker 3: to ban them. And what they didn't realize was that
• 8:10
  Speaker 3: all they had to do those users was get another
• 8:13
  Speaker 3: piece of software to allow them to get into Napster
• 8:16
  Speaker 3: under another name. And so it was a pretty quick workaround.
• 8:21
  Speaker 2: Yeah, and so Metallica got such a bad name for this.
• 8:24
  Speaker 2: This is such bad pr for them. And I can't
• 8:27
  Speaker 2: remember the name of their basis, their original basis or
• 8:30
  Speaker 2: there maybe their second basis. He left in protest saying
• 8:33
  Speaker 2: like this is wrong Newstead, but it was it new
• 8:37
  Speaker 2: said okay, they they were there's still today people are
• 8:42
  Speaker 2: like Metallica's who they're fans. They did not. They found
• 8:45
  Speaker 2: the names of their fans and had Napster banned them,
• 8:47
  Speaker 2: and there was a screen you would get that said,
• 8:50
  Speaker 2: at the request of Metallica, you are not allowed to
• 8:53
  Speaker 2: access Napster any longer. But they didn't sue any individual fans.
• 8:58
  Speaker 2: The ria ir AA did, and so did doctor Dre
• 9:02
  Speaker 2: And I read about one twelve year old girl, Brianna Gahara,
• 9:06
  Speaker 2: who had to pay two thousand dollars because the RIAA
• 9:11
  Speaker 2: sued her and she had to pay two grand a
• 9:14
  Speaker 2: twelve year old girl. That's what it was like. That's
• 9:16
  Speaker 2: how upset the labels were at this point.
• 9:19
  Speaker 3: Well, she probably didn't think about that when she was
• 9:21
  Speaker 3: getting two thousand dollars worth of free music.
• 9:23
  Speaker 2: Well essentially it's what they were doing. But she still
• 9:25
  Speaker 2: ended up paying like two dollars a song, which is
• 9:27
  Speaker 2: really that's outrageous. Today in twenty twenty four.
• 9:30
  Speaker 3: Yeah, it's double yeah. At least so one thing this
• 9:36
  Speaker 3: did was just you know, brought it to the news
• 9:38
  Speaker 3: and a lot of people that weren't sort of on
• 9:40
  Speaker 3: the on the front edge of that technology, we're like, oh,
• 9:45
  Speaker 3: wait a minute, there's a site where you can just
• 9:46
  Speaker 3: go get music traded. So it actually it was sort
• 9:50
  Speaker 3: of like the barbar streisand effect it ended up creating
• 9:53
  Speaker 3: more users. Napster tried to hang in there. There was
• 9:56
  Speaker 3: an attempted acquisition at one point for ninety something million
• 9:59
  Speaker 3: bucks that a judge shut down for some reason that's
• 10:04
  Speaker 3: not worth getting into. But they tried to become like
• 10:07
  Speaker 3: a legitimate player. They paid royalties, eventually about twenty six
• 10:11
  Speaker 3: million dollars of royalties. They tried different models, they tried subscriptions.
• 10:17
  Speaker 3: Nothing really worked, I think because that time. By that time,
• 10:20
  Speaker 3: there were other like I mentioned LimeWire that was the
• 10:22
  Speaker 3: one I used. I never used Napster, Kazah, frost Wire,
• 10:26
  Speaker 3: these other ones. Competitors came along, and so Napster, while
• 10:30
  Speaker 3: like completely changing the game because they were the first ones,
• 10:34
  Speaker 3: didn't end up being some big huge They couldn't get
• 10:37
  Speaker 3: some big acquisition for it.
• 10:39
  Speaker 2: No, they just like you said changed the game. But
• 10:43
  Speaker 2: one of the things that also was changed from Napster
• 10:46
  Speaker 2: in its brief two years and then its follow up
• 10:49
  Speaker 2: successors like kaza is the idea that, like, people aren't
• 10:53
  Speaker 2: going to pay yeah, fifteen or twenty dollars or even
• 10:56
  Speaker 2: twelve dollars for a CD anymore. It's not how we
• 10:58
  Speaker 2: want to do it. That's ridiculous for not doing it.
• 11:00
  Speaker 2: I would rather take my chances at getting sued by
• 11:03
  Speaker 2: the RIAA and get music for free than pay for
• 11:09
  Speaker 2: an album that I'm only going to like one song on.
• 11:11
  Speaker 2: That's what I said. And it was just the everything
• 11:15
  Speaker 2: was completely upended. And Apple came along in two thousand
• 11:18
  Speaker 2: and three and brought massive stability to this huge c change,
• 11:24
  Speaker 2: but it didn't go back to the way it was.
• 11:26
  Speaker 2: They said, we're gonna we have a model here that
• 11:29
  Speaker 2: can actually accommodate both in this new kind of environment
• 11:33
  Speaker 2: of how music is created and delivered.
• 11:35
  Speaker 3: Now, Yeah, I want to jump back a second. I
• 11:38
  Speaker 3: wonder if because I think it's a real shame that
• 11:42
  Speaker 3: you know, you know, maybe at fifteen dollars is too
• 11:44
  Speaker 3: much for a CD considering how cheap they were to produce.
• 11:48
  Speaker 3: But I think it's a real shame. People were like,
• 11:50
  Speaker 3: I want to pay zero dollars for music now, like
• 11:53
  Speaker 3: I think it should be free and screw everybody that
• 11:57
  Speaker 3: makes a living doing this under if initially, if the
• 12:01
  Speaker 3: record labels had immediately just gone down to like six '
• 12:05
  Speaker 3: ninety nine for a CD, if that would have changed
• 12:08
  Speaker 3: the game.
• 12:10
  Speaker 2: I don't know. Maybe. I think one of the things
• 12:12
  Speaker 2: that did change attitudes like that was a general public
• 12:15
  Speaker 2: awareness that was spread that the artists were being harmed
• 12:19
  Speaker 2: by this.
• 12:19
  Speaker 3: Yeah, like you're taking.
• 12:20
  Speaker 2: Music did deserve you did deserve to be compensated for
• 12:24
  Speaker 2: the music you made, like it shouldn't be free. Year
• 12:26
  Speaker 2: So it was kind of like the It was like
• 12:28
  Speaker 2: the pendulum of development, you know, but with music instead.
• 12:33
  Speaker 3: All right, so I agree you mentioned Apple and specifically
• 12:37
  Speaker 3: iTunes is what came out in two thousand and three
• 12:39
  Speaker 3: and the iPod and they started selling songs for ninety
• 12:42
  Speaker 3: nine cents. One thing we didn't mention was that if
• 12:45
  Speaker 3: you had a PC and you were on LimeWire or napster, like,
• 12:50
  Speaker 3: there was a decent chance you might get a virus.
• 12:53
  Speaker 3: They were pretty rife with viruses, so you could you
• 12:57
  Speaker 3: could avoid you could avoid that danger and you could
• 13:01
  Speaker 3: pay ninety nine cents. You can get that single song.
• 13:04
  Speaker 3: If you're if you're You, if you're Josh, and you
• 13:06
  Speaker 3: don't want to take a chance on buying a full album,
• 13:09
  Speaker 3: you could just get that single Richard Mark song it
• 13:11
  Speaker 3: don't it don't mean nothing, and you would be super excited.
• 13:14
  Speaker 2: Well that was the thing. Richard Marx is a bad
• 13:17
  Speaker 2: example because I think his two major albums both had
• 13:20
  Speaker 2: multiple hits on them. So all right, I'm just gonna
• 13:24
  Speaker 2: say it. Well, let's go with UTAs Saints. They're a
• 13:27
  Speaker 2: perfect example from roughly this era. They were I don't
• 13:32
  Speaker 2: even know where they were from, maybe British electronic.
• 13:35
  Speaker 3: I think I remember that that song, yes, because that
• 13:38
  Speaker 3: was a.
• 13:38
  Speaker 2: Song, right, it's samp something good. It sampled Kate Bush
• 13:43
  Speaker 2: and they would say like you toss Saints. Yeah, yes,
• 13:46
  Speaker 2: that song. So you bought that album. To the album,
• 13:49
  Speaker 2: you would just be like.
• 13:50
  Speaker 3: God, well that's your problem, you know, buy LP.
• 13:55
  Speaker 2: I was big time into electronic music at the time,
• 13:59
  Speaker 2: and people weren't coming out with albums like every week
• 14:02
  Speaker 2: that were you know, electronic. It was still very guitar heavy,
• 14:05
  Speaker 2: so I know you had to work with what you
• 14:07
  Speaker 2: got and frequently get burned. Sorry Utah Saints if you're
• 14:11
  Speaker 2: out there listening.
• 14:13
  Speaker 3: So, overall, statistically, from and this is a pretty staggering
• 14:18
  Speaker 3: stat from two thousand and one to twenty ten, when
• 14:22
  Speaker 3: this first started. Over that next decade, physical music sales
• 14:26
  Speaker 3: dropped sixty percent all over the world, about fourteen billion
• 14:30
  Speaker 3: dollars in revenue loss. Digital sales rose about four billion,
• 14:34
  Speaker 3: But that left a ten billion dollar annual discrepancy and
• 14:40
  Speaker 3: what the music business was bringing in.
• 14:42
  Speaker 2: Yeah. If that doesn't get it across, I don't know
• 14:45
  Speaker 2: what does.
• 14:45
  Speaker 3: Yeah.
• 14:47
  Speaker 2: So yeah, because at that point it's basically just Richard
• 14:50
  Speaker 2: Marx keeping the music labels afloat. The fact that they
• 14:53
  Speaker 2: had any money was essentially one hundred percent tributable to him.
• 14:57
  Speaker 3: Well, you know what they say, It don't mean nothing
• 14:59
  Speaker 3: until you sign it on the outed line.
• 15:00
  Speaker 2: That's right, that's what he's talking about. My man.
• 15:05
  Speaker 3: Should we take a break?
• 15:06
  Speaker 2: Yes? Okay. So while Napster was like, hey, we're into
• 15:21
  Speaker 2: file sharing, some other ones were as well. At the
• 15:24
  Speaker 2: same time, roughly an alternative model was developing, and that
• 15:28
  Speaker 2: was just streaming, right, So rather than like downloading an
• 15:32
  Speaker 2: actual MP three that you would keep on your hard drive,
• 15:34
  Speaker 2: you could burn onto CD do whatever. This was like,
• 15:37
  Speaker 2: there were like music servers. This is this is crazy.
• 15:41
  Speaker 2: To bear with me for a second. That would actually
• 15:43
  Speaker 2: you would stream the music over the internet through like
• 15:46
  Speaker 2: a player on your on your computer. Usually had to
• 15:50
  Speaker 2: download the player itself. This is before they called them apps,
• 15:54
  Speaker 2: and you could sometimes select songs and then other times
• 15:58
  Speaker 2: it was more just like an f radio station where
• 16:01
  Speaker 2: they would almost play it plates whatever, random songs that
• 16:04
  Speaker 2: you had no control over.
• 16:06
  Speaker 3: Right, well, you did have control in that you could
• 16:08
  Speaker 3: skip songs and stuff. You just couldn't pick the songs.
• 16:11
  Speaker 2: Sometimes though, you could only skip a finite number of
• 16:14
  Speaker 2: songs before it's like nope, you have to listen to
• 16:16
  Speaker 2: this CARDI one.
• 16:17
  Speaker 3: Yeah, but that was the big problem with Launch Media
• 16:19
  Speaker 3: that they probably could have gotten away with it if
• 16:21
  Speaker 3: they didn't give you the ability to skip songs, right
• 16:24
  Speaker 3: because it was a little more like radio. But because
• 16:27
  Speaker 3: they had that fast forward button, the RIAA got involved
• 16:31
  Speaker 3: again and was like, we don't like that because one
• 16:34
  Speaker 3: thing I don't think we mentioned is radio. It was
• 16:40
  Speaker 3: a way for people to listen to songs and music
• 16:42
  Speaker 3: and get turned onto new stuff.
• 16:43
  Speaker 2: It was a live transmission.
• 16:45
  Speaker 3: Yeah, but what radio also was was a free advertisement
• 16:50
  Speaker 3: for those bands. So you know, every time a song
• 16:54
  Speaker 3: gets played on the radio, that's an ad to little
• 16:57
  Speaker 3: Josh Clark, like, hey, mis Sucker, go out this album
• 17:00
  Speaker 3: if you like this.
• 17:02
  Speaker 2: Yeah, Utah Saints are great.
• 17:04
  Speaker 3: This is this disrupted everything. The fact that you could
• 17:07
  Speaker 3: skip songs. That's why the IAA got upset because you know,
• 17:11
  Speaker 3: they're like, well, this is a lot like radio, but
• 17:12
  Speaker 3: you can't skip songs of the radio. We want people
• 17:14
  Speaker 3: to hear these songs because they're little ads.
• 17:18
  Speaker 2: Right exactly. So that was a big problem. The streaming
• 17:21
  Speaker 2: services were as big a problem, maybe not as big,
• 17:24
  Speaker 2: but pretty close to the same amount of problem as
• 17:27
  Speaker 2: file sharing services were, too. They weren't like any kind
• 17:30
  Speaker 2: of solution as far as the music industry was concerned.
• 17:34
  Speaker 3: Yeah, and those were you know, like Launch Media, who
• 17:37
  Speaker 3: eventually became Yahoo Music. Those again, though, were just playing.
• 17:42
  Speaker 3: There was like a I don't know if it was
• 17:44
  Speaker 3: a real person programming, but it was as if a
• 17:46
  Speaker 3: DJ was playing music. The first legit on demand streaming
• 17:50
  Speaker 3: surface was Rhapsody in two thousand and one, which started
• 17:54
  Speaker 3: out as part of listen dot Com, was bought by
• 17:57
  Speaker 3: a company called Real Networks, and then eventually, in sort
• 18:02
  Speaker 3: of an odd twist, it bought Napster and in twenty sixteen,
• 18:06
  Speaker 3: rhapsoly was rebranded as Napster.
• 18:09
  Speaker 2: Yeah. Do you remember Real Player That was one of
• 18:11
  Speaker 2: those that software you had to download to stream music?
• 18:15
  Speaker 3: Oh? Yeah, I remember that.
• 18:16
  Speaker 2: I went and looked at old real Player skins and
• 18:18
  Speaker 2: it's just like, oh my god, those things were so ugly.
• 18:22
  Speaker 2: But they I mean, they're super. They look super two
• 18:25
  Speaker 2: thousand and five.
• 18:28
  Speaker 3: Just seeing that little LimeWire lime actually gave me some
• 18:30
  Speaker 3: feels because I was doing by the way, I was
• 18:33
  Speaker 3: doing the same thing. I'm not saying, like when I said,
• 18:36
  Speaker 3: it's a real shame that people just said I want
• 18:40
  Speaker 3: my music free, like I was doing it too at
• 18:42
  Speaker 3: the time.
• 18:43
  Speaker 2: Oh okay, well, I'm glad you said that.
• 18:45
  Speaker 3: I was part of that, that real shame.
• 18:47
  Speaker 2: You know.
• 18:47
  Speaker 3: I was like, oh, great, LimeWire, I can trade music.
• 18:50
  Speaker 3: But pretty quickly I was I mean, I kept buying
• 18:53
  Speaker 3: CDs for a while of the bands I loved, and
• 18:55
  Speaker 3: pretty quickly I was like, wait a minute, there's something
• 18:57
  Speaker 3: about this. It doesn't feel right.
• 19:00
  Speaker 2: Hey. One other thing that's occurred to me Chuck Is.
• 19:03
  Speaker 2: I'm sure somebody's like, well, yeah, CDs might be like
• 19:06
  Speaker 2: fifteen dollars a piece, but don't forget Columbia House, where
• 19:09
  Speaker 2: you get like ten of them for a penny.
• 19:11
  Speaker 3: I never did that.
• 19:13
  Speaker 2: You didn't. Did I ever tell you my Columbia House story?
• 19:15
  Speaker 3: You did, But I think people need to hear it
• 19:17
  Speaker 3: if they haven't heard it. Okay, so told me last
• 19:21
  Speaker 3: week at a Cubs game. Was it just that recent?
• 19:24
  Speaker 2: Huh? And I got to work on my memory. I
• 19:29
  Speaker 2: need some prevag in. So like you would send off
• 19:33
  Speaker 2: for those of you who don't know, you would send
• 19:34
  Speaker 2: like literally you tape a penny to a postcard and
• 19:37
  Speaker 2: send it into Columbia House and you could you could
• 19:39
  Speaker 2: check like what albums you wanted them to send you,
• 19:41
  Speaker 2: and like magic, they would send you those ten albums
• 19:44
  Speaker 2: for a penny, But then you were automatically signed up
• 19:46
  Speaker 2: for their subscription service and they would send you albums
• 19:49
  Speaker 2: that you didn't want it like two times the price.
• 19:53
  Speaker 2: So it really wasn't a good deal unless you could
• 19:55
  Speaker 2: get out of it with just those first ten albums.
• 19:59
  Speaker 2: And I did exact factly that because when they sent
• 20:02
  Speaker 2: me the first first handful of records that I didn't want.
• 20:06
  Speaker 2: I sent them back with a letter explaining that I
• 20:09
  Speaker 2: was twelve years old when I entered into this contract.
• 20:12
  Speaker 2: There's nowhere in the United States that it's legal for
• 20:14
  Speaker 2: a twelve year old to enter into a contract, So
• 20:16
  Speaker 2: please stop sending me albums. And they did.
• 20:20
  Speaker 3: I love it. Very precocious kid.
• 20:23
  Speaker 2: Thanks. I like that story. So I was a little bastard.
• 20:27
  Speaker 3: Yeah, you mean like the rapper.
• 20:30
  Speaker 2: No, that's old Dirty Bastard, right.
• 20:32
  Speaker 3: I was thinking Low Wayne and Old Dirty Bastard got together.
• 20:35
  Speaker 2: Right, little Bastard. That's my new rap name.
• 20:39
  Speaker 3: Not tepid t all right. So Panta Pandora, not pantorra
• 20:44
  Speaker 3: Pandora came along in two thousand and five. It began
• 20:48
  Speaker 3: as Savage Beast Technologies, and they were founded on this
• 20:53
  Speaker 3: idea of the algorithm to recommend songs to where it
• 20:57
  Speaker 3: would curate like this is Chuck's station. And the way
• 21:01
  Speaker 3: they did this was through something called the Music Genome Project,
• 21:05
  Speaker 3: which I remember just thinking it was the coolest idea
• 21:08
  Speaker 3: and thing ever back then, and it was a cool thing.
• 21:11
  Speaker 2: It was.
• 21:12
  Speaker 3: It was basically that they would analyze four hundred and
• 21:15
  Speaker 3: fifty unique attributes of every song that exists from you know,
• 21:20
  Speaker 3: as simple as like what genre is it to like
• 21:22
  Speaker 3: how nasally somebody's voice was.
• 21:24
  Speaker 2: Wow.
• 21:25
  Speaker 3: Then they would evaluate it on a scale of one
• 21:27
  Speaker 3: to five with half increments, and the end result would
• 21:30
  Speaker 3: be the songs you know, quote unquote DNA. Initially, they
• 21:34
  Speaker 3: had a musicologist that did this by ear in the
• 21:37
  Speaker 3: hand and it took like fifteen to thirty minutes a song.
• 21:40
  Speaker 3: Eventually AI took over, but it was that was the
• 21:43
  Speaker 3: big attraction for Pandora was like this super cool project
• 21:48
  Speaker 3: where they're categorizing music so specifically that it will start
• 21:52
  Speaker 3: to learn what you like and you can curate your
• 21:55
  Speaker 3: own radio station.
• 21:56
  Speaker 2: That's nuts. I never heard of that music genome project before.
• 22:00
  Speaker 3: Oh really, it was sort of all the rage at
• 22:03
  Speaker 3: the time.
• 22:04
  Speaker 2: Pretty groundbreaking. I mean, I'm taking it this is in
• 22:06
  Speaker 2: the early two thousands.
• 22:08
  Speaker 3: I mean it was when Pandora started. That was sort
• 22:10
  Speaker 3: of the basis of how they worked.
• 22:11
  Speaker 2: Wow.
• 22:12
  Speaker 3: So yeah, two thousand and five.
• 22:13
  Speaker 2: Okay, So Pandora also started to try a subscription model.
• 22:18
  Speaker 2: Were they the first They may.
• 22:20
  Speaker 3: Have been, Well, I think Naster tried it but it
• 22:22
  Speaker 3: didn't work.
• 22:23
  Speaker 2: Okay, So Pandora was the first I guess that was
• 22:26
  Speaker 2: successful at it. It was I think three dollars a
• 22:30
  Speaker 2: month for streaming music with no advertising, which sounds like
• 22:34
  Speaker 2: a deal, But there are only like ten songs on
• 22:36
  Speaker 2: the internet at the time it's it did, and they
• 22:40
  Speaker 2: tried like ten hour free trials kind of like those
• 22:43
  Speaker 2: AOL sample discs. Yeah, but only one. They only had
• 22:47
  Speaker 2: like a one percent conversion rate.
• 22:49
  Speaker 3: Yeah.
• 22:49
  Speaker 2: And one of the reasons why I think that doesn't
• 22:52
  Speaker 2: get mentioned very often is that we're talking this is
• 22:55
  Speaker 2: like the mid oughts two thousand and five. People were
• 23:00
  Speaker 2: not at all comfortable with giving their credit card information
• 23:03
  Speaker 2: out over the internet. Yeah, and that's the only way
• 23:06
  Speaker 2: you could buy.
• 23:07
  Speaker 3: Back then, Yeah, when it just seemed like the most
• 23:09
  Speaker 3: like top secret thing you could even have as a
• 23:12
  Speaker 3: part of your life, right.
• 23:13
  Speaker 2: Yeah. So I really truly think that that was one
• 23:16
  Speaker 2: of the reasons why this got a slow start. People
• 23:18
  Speaker 2: were just so comfortable with paying for things using their
• 23:21
  Speaker 2: credit card over the internet. And that's I mean, how
• 23:23
  Speaker 2: else you're gonna build some but you're gonna send them
• 23:25
  Speaker 2: a physical bill for your online streaming service.
• 23:28
  Speaker 3: You get a letter from a twelve year old after that.
• 23:31
  Speaker 2: Yeah, exactly imagine Pandora getting checks mailed to them every month.
• 23:35
  Speaker 2: That'd be hilarious. But I mean, I guess that's what
• 23:37
  Speaker 2: you'd have to do to get business going.
• 23:39
  Speaker 3: Yeah, I think you're totally right. Those early days of
• 23:41
  Speaker 3: e commerce, I think a lot of us had some
• 23:43
  Speaker 3: trepidation about entering those digits online, you.
• 23:45
  Speaker 2: Know, Yeah, and it might become it might be is
• 23:48
  Speaker 2: a confirmation bias where I, like, I was like that,
• 23:52
  Speaker 2: so I just assume other people were as well. But
• 23:55
  Speaker 2: most of the people I knew were not comfortable giving
• 23:57
  Speaker 2: out their credit card info at that time.
• 23:59
  Speaker 3: No, I think you're right on the money, no bias whatsoever.
• 24:03
  Speaker 3: You're just right cool.
• 24:08
  Speaker 2: So Congress got involved, actually in the United States at least,
• 24:11
  Speaker 2: and they came up with the Copyright Royalty and Distribution
• 24:14
  Speaker 2: Reform Act of two thousand and four. That's how disruptive
• 24:18
  Speaker 2: napster was. Yeah, in four years, Congress had passed an
• 24:20
  Speaker 2: act essentially trying to help smooth this over. I'm sure
• 24:24
  Speaker 2: it was largely in the favor of the labels, but
• 24:27
  Speaker 2: it set up the US Copyright Royalty Board where these
• 24:32
  Speaker 2: these software companies and streamers would come and take claims
• 24:37
  Speaker 2: or be taken to this board by music labels to
• 24:40
  Speaker 2: figure out who owed who what.
• 24:41
  Speaker 3: Right, Yeah, which was a big, you know, through a
• 24:45
  Speaker 3: big wrench in the plans of a lot of these
• 24:47
  Speaker 3: companies that were just emerging. I think the ones that
• 24:49
  Speaker 3: were sort of smaller gave up pretty quickly because it
• 24:53
  Speaker 3: was such a legal quagmire. Like Yahue Music wasn't even
• 24:58
  Speaker 3: you know, a smallish one. They shut themselves down.
• 25:01
  Speaker 2: Yeah for sure. So again Apple kind of rides to
• 25:06
  Speaker 2: the rescue. And in two thousand and seven they introduced
• 25:10
  Speaker 2: the iPhone. Because I don't know if we said it
• 25:12
  Speaker 2: or not. Before the iPhone came along, if you wanted
• 25:14
  Speaker 2: to listen to downloaded music anywhere away from your PC,
• 25:19
  Speaker 2: you had to buy an iPod or one of it's
• 25:22
  Speaker 2: also ran competitors like Zoom or something like that, but
• 25:25
  Speaker 2: you had to have like a physical device to listen to.
• 25:28
  Speaker 2: When the iPhone came out, it was like throw all
• 25:31
  Speaker 2: that crowd away. Now you can not only listen to
• 25:35
  Speaker 2: your MP three's that you're buying off the iTunes store,
• 25:37
  Speaker 2: you can listen to streaming music. You can do everything
• 25:40
  Speaker 2: you can on the internet, you can do on your iPhone.
• 25:43
  Speaker 2: So it provided a super stable, safe platform, not at
• 25:47
  Speaker 2: all skanky. You weren't going to get viruses or anything
• 25:51
  Speaker 2: like that from downloading apps from the App store. And
• 25:54
  Speaker 2: Pandora actually saw the writing on the wall very early,
• 25:58
  Speaker 2: and they had an app like I think the next
• 26:00
  Speaker 2: year that was available for the iPhone that was a
• 26:04
  Speaker 2: Pandora streaming app. And I think the first year, within
• 26:08
  Speaker 2: nine months that the app that the App store came out,
• 26:12
  Speaker 2: the Pandora app was on almost a quarter of all
• 26:15
  Speaker 2: iPhones in the world.
• 26:16
  Speaker 3: Yeah, this also brought back funny memories of this is
• 26:21
  Speaker 3: kind of like when we were getting going with the
• 26:24
  Speaker 3: TV show.
• 26:25
  Speaker 2: Ish really at those twenty thirteen.
• 26:29
  Speaker 3: Well, I'm just talking about no, no, no, I'm not saying
• 26:31
  Speaker 3: the launch of the iPhone. I'm saying the apps being
• 26:36
  Speaker 3: like the end all be all. Like I remember very
• 26:38
  Speaker 3: specifically in some of those TV meetings some of the
• 26:42
  Speaker 3: guys on staff, like all they could talk about was
• 26:44
  Speaker 3: apps and look at this new app and it does this,
• 26:47
  Speaker 3: and it does this cool thing, and it does this
• 26:48
  Speaker 3: cool weird thing, and it was just app, apps, apps,
• 26:51
  Speaker 3: And it's just funny to look back how that is
• 26:53
  Speaker 3: at least changed for me. I mean, maybe people still
• 26:55
  Speaker 3: use all kinds of funky apps, but almost every app
• 26:58
  Speaker 3: I have is utilitarian and serve some kind of like
• 27:03
  Speaker 3: function for doing something right.
• 27:05
  Speaker 2: But if you wanted to razzle dazzle a C suite
• 27:08
  Speaker 2: executive who is like ten years older than you at
• 27:10
  Speaker 2: the time, all you had to do is even let
• 27:12
  Speaker 2: them know you were thinking in terms of apps, and
• 27:15
  Speaker 2: they would just automatically promote you. I totally remember that time.
• 27:19
  Speaker 2: We've survived a lot of weird times, haven't we.
• 27:21
  Speaker 3: Hey we have, including the great stuff you should know.
• 27:24
  Speaker 3: Fire of eight.
• 27:26
  Speaker 2: Yeah, right, death of Richard Marx.
• 27:29
  Speaker 3: Oh he didn't die, did he.
• 27:31
  Speaker 2: No? Okay, that was a terrible joke. I'm sorry, Richard Mark, Sorry,
• 27:37
  Speaker 2: Utah Saints, Sorry Richard Mars Right.
• 27:40
  Speaker 3: Uh so we have to talk about Spotify. Should we
• 27:44
  Speaker 3: do that or take a break?
• 27:45
  Speaker 2: First, let's talk about Spotify, all right?
• 27:50
  Speaker 3: Spotify comes along. They changed the game. Pandora was still
• 27:54
  Speaker 3: trying to be you know, kind of like radio in
• 27:57
  Speaker 3: a way. Spotify was like, know, we're really going to
• 28:01
  Speaker 3: be on demand and this is kind of what everyone's
• 28:06
  Speaker 3: been waiting for. It was a company out of Stockholm, Sweden,
• 28:09
  Speaker 3: very famous for swedeness, for encouraging and supporting their tech industries.
• 28:14
  Speaker 3: That's why there's somebody coming out of there. But they
• 28:17
  Speaker 3: launched in two thousand and six, and then I think
• 28:21
  Speaker 3: Weighted had to wait until twenty eleven to launch in
• 28:24
  Speaker 3: the US because they had to you know, they were
• 28:28
  Speaker 3: I guess smart enough early on to pre negotiate with
• 28:30
  Speaker 3: record labels and kind of get all that settled, so
• 28:34
  Speaker 3: they weren't just dragged into court right away.
• 28:36
  Speaker 2: Right so early in their early years, even when they
• 28:38
  Speaker 2: were just available in Europe, in Western Europe, they had
• 28:42
  Speaker 2: ten million users and at one point six of them
• 28:45
  Speaker 2: were already paying users. Right So before this thing even
• 28:48
  Speaker 2: hit the US, it was valued at a billion dollar
• 28:51
  Speaker 2: Spotify was, and when it hit the US, it it
• 28:54
  Speaker 2: just reached this incredibly massive level. One of the things
• 29:00
  Speaker 2: that Spotify did, I think today there they're at like
• 29:03
  Speaker 2: six hundred and fifteen million active users something crazy like that.
• 29:08
  Speaker 2: But one of the ways that they managed to kind
• 29:11
  Speaker 2: of come in and be like, hey, peace everybody, was
• 29:14
  Speaker 2: that they really paid royalties to the artists and the
• 29:18
  Speaker 2: labels or whoever owned the copyright of that song. They
• 29:22
  Speaker 2: paid like seventy percent of their revenues went to pay royalties,
• 29:27
  Speaker 2: and so they have been losing money every year since
• 29:31
  Speaker 2: at least twenty eleven, probably back when they debuted in
• 29:34
  Speaker 2: two thousand and six and I think twenty twenty three. No,
• 29:39
  Speaker 2: the first two couriers of twenty twenty four, yes, they
• 29:44
  Speaker 2: they made record profits, and because they lost money every
• 29:48
  Speaker 2: year up until then, a record profit for them could
• 29:50
  Speaker 2: have been one dollar. But they finally turned profitable essentially,
• 29:54
  Speaker 2: and they're saying, like, now we're going to be profitable,
• 29:57
  Speaker 2: profitable from here on out. One of the criticisms they
• 29:59
  Speaker 2: took is that they became profitable by going through massive
• 30:02
  Speaker 2: rounds of layoffs and jacking up the price of their subscriptions.
• 30:06
  Speaker 2: But the point about to know about Spotify is they
• 30:10
  Speaker 2: created a new standard by saying we're going to actually
• 30:12
  Speaker 2: pay real royalties to the people who own this music.
• 30:16
  Speaker 3: Oh for sure. So I think we take that break.
• 30:19
  Speaker 1: Now, Okay, we'll be right back, all right.
• 30:33
  Speaker 3: So twenty fifteen, a little several new players came on
• 30:38
  Speaker 3: the scene. Title you might have heard a lot about
• 30:41
  Speaker 3: at the time, all capitals TIDL. This was an artist
• 30:45
  Speaker 3: owned alternative kind of like you know, United artists and
• 30:49
  Speaker 3: movies back in the day. Like musicians actually got together
• 30:54
  Speaker 3: under the guidance of jay Z to buy a company.
• 30:59
  Speaker 3: Initially it was an Norway based company called a SPIRO
• 31:03
  Speaker 3: that we're developing. It stood for wireless music player but
• 31:07
  Speaker 3: the WIMP and it was higher bit rates, supposedly better
• 31:12
  Speaker 3: quality and also like real human editors making music recommendations.
• 31:18
  Speaker 3: So jay Z gets on board. He's like, man, we
• 31:20
  Speaker 3: can't call it whimp in the United States. It's not
• 31:24
  Speaker 3: tough at all. So they changed it to title, right.
• 31:27
  Speaker 2: I read an interesting article. Also, big ups to Olivia
• 31:30
  Speaker 2: for helping us with this one. But she found an
• 31:32
  Speaker 2: article from Loud and Quiet dot com written by Stuart
• 31:36
  Speaker 2: Stubbs called five years on a very silly launch of
• 31:38
  Speaker 2: Title and if you like, just kind of laughing a
• 31:42
  Speaker 2: little bit at the misfortune of super egotistical, wealthy people
• 31:47
  Speaker 2: like that article a lot. Yeah, he just slams like
• 31:50
  Speaker 2: this launch and I haven't seen it because I can't
• 31:53
  Speaker 2: bear to watch it based on his description of how
• 31:56
  Speaker 2: awkward it is. But apparently it was one of the
• 31:59
  Speaker 2: most awkward star studded events ever held.
• 32:02
  Speaker 3: Yeah, I've seen it. It was awkward. It was just
• 32:05
  Speaker 3: I don't know, man, Sometimes companies just screw it all up,
• 32:08
  Speaker 3: you know, right.
• 32:10
  Speaker 2: I think one of the big screw ups was to
• 32:12
  Speaker 2: basically tell the audience not to clap for anything, which
• 32:14
  Speaker 2: I'm sure was a decision because you don't want it
• 32:19
  Speaker 2: to seem like these stars showed up so that they
• 32:20
  Speaker 2: could be applauded for everything they said. Yeah, but instead
• 32:23
  Speaker 2: it made it super awkward and quiet. From what Stuart
• 32:27
  Speaker 2: Stubb says, it is.
• 32:29
  Speaker 3: Very weird for Madonna to walk out on stage and
• 32:32
  Speaker 3: be met with silence. It was slightly surreal.
• 32:35
  Speaker 1: Yeah.
• 32:36
  Speaker 3: So Titles Deal was another company obviously because they were
• 32:40
  Speaker 3: artists that wanted to pay through pretty well and musicians
• 32:45
  Speaker 3: got a seventy five royalty on each song. It wasn't
• 32:49
  Speaker 3: too long after that they were being sued for underpayment
• 32:54
  Speaker 3: and it ended up not being a financial success as
• 32:58
  Speaker 3: a company, right. A bit of a mess, it seemed like.
• 33:02
  Speaker 2: But it got bailed out by Jack Dorsey, the co
• 33:05
  Speaker 2: founder of Twitter. He was leading a company called Block Inc.
• 33:09
  Speaker 2: And in twenty twenty one he used Block Inc funds
• 33:13
  Speaker 2: to buy an eighty six percent share in Title for
• 33:17
  Speaker 2: three hundred million dollars. Yeah, and essentially the shareholders in
• 33:23
  Speaker 2: Block sued. They sued Jack Dorsey for this because they're like,
• 33:26
  Speaker 2: you did this as a favorite to jay Z. You
• 33:28
  Speaker 2: can't do that to us. This is a terrible deal.
• 33:32
  Speaker 2: And they actually had the lawsuit dismissed.
• 33:35
  Speaker 3: Yeah, I think. I mean, if you want to compare,
• 33:37
  Speaker 3: I believe that jay Z, what did they pay like
• 33:39
  Speaker 3: fifty something million?
• 33:40
  Speaker 2: Everybody chipped in fifty six million?
• 33:42
  Speaker 3: Yeah, okay, so then flipped it for three hundred to
• 33:45
  Speaker 3: his friend.
• 33:47
  Speaker 2: But really it was probably worth half of the original
• 33:51
  Speaker 2: price by this time because it was not a success
• 33:54
  Speaker 2: at all, and even still today, I saw it has
• 33:56
  Speaker 2: about five million users, it says, but that that's even
• 33:59
  Speaker 2: disputed by people outside the company. And like I said that,
• 34:04
  Speaker 2: judge dismissed the case against Jack Dorsey and he said
• 34:08
  Speaker 2: that that there's nothing legally wrong in approving it, even
• 34:11
  Speaker 2: though it was quote a terrible business decision.
• 34:14
  Speaker 3: Yeah, man, that's pretty funny.
• 34:17
  Speaker 2: I was so mad.
• 34:19
  Speaker 3: Oh yeah, I wonder if you've snuck up behind jay
• 34:21
  Speaker 3: Z and looked at his phone what he's playing.
• 34:23
  Speaker 2: With the real player he's ogreat I.
• 34:27
  Speaker 3: Did look up that logo, by the way, and it
• 34:28
  Speaker 3: was a wave of nostalgia. Might another one that came
• 34:33
  Speaker 3: out in twenty fifteen. You might have seen Neil Young
• 34:36
  Speaker 3: screaming at people on your television set right around then.
• 34:40
  Speaker 3: It was Pono that was his this is actual device.
• 34:43
  Speaker 3: It was a player, the Pono player, and it was
• 34:46
  Speaker 3: a crowdfunded campaign that raised about ten million bucks. And
• 34:49
  Speaker 3: the whole pitch here was from Neil Young, especially was
• 34:53
  Speaker 3: MP three's are garbage and that compression stinks and this
• 34:59
  Speaker 3: is all the night. Like Neil Young was much more
• 35:01
  Speaker 3: critical and probably cussed a lot more, but he's like,
• 35:04
  Speaker 3: the quality here is better, and this is the way
• 35:07
  Speaker 3: music should be listening. It's a travesty how we're listening
• 35:09
  Speaker 3: to music these days. And that company, I mean, I
• 35:13
  Speaker 3: guess Neil Young failed to realize it. By and large,
• 35:15
  Speaker 3: most people don't care about the quality to that level.
• 35:18
  Speaker 2: Yeah, a lot of people just can't detect it. It's
• 35:20
  Speaker 2: not even that they don't care, it's that once you
• 35:23
  Speaker 2: get to a certain bit rate measured in kilobytes per second,
• 35:26
  Speaker 2: that's how much how many bits are being transferred per second.
• 35:30
  Speaker 2: So obviously the more bits transferred, the more of the
• 35:32
  Speaker 2: song that's captured, the better the sound quality. Somewhere outside
• 35:37
  Speaker 2: of two hundred and fifty six kilobytes a second. When
• 35:40
  Speaker 2: you start going over that, people generally can't tell the difference,
• 35:44
  Speaker 2: especially if you're just using like earbuds or something like that.
• 35:47
  Speaker 2: You know, we're just playing it through the speaker of
• 35:48
  Speaker 2: your iPhone.
• 35:49
  Speaker 3: Especially, Yeah, oh god, do people do that?
• 35:54
  Speaker 2: Very obnoxious people do.
• 35:55
  Speaker 3: Yes, A CD, just for comparison, is a little over
• 35:59
  Speaker 3: fourteen high hundred kilobits per second. And you said two
• 36:03
  Speaker 3: fifty six is where people can't tell much of a difference.
• 36:07
  Speaker 3: That's like, that's like people with a good ear they say,
• 36:10
  Speaker 3: if you're around ninety to one hundred and you're not
• 36:13
  Speaker 3: the most discerning listener and you're not playing, you know,
• 36:16
  Speaker 3: through something great, then you probably won't be able to
• 36:18
  Speaker 3: tell the difference.
• 36:19
  Speaker 2: Right. But again, if you're Neil Young, yes you're really
• 36:23
  Speaker 2: upset about this, but it's a course. He really missed
• 36:26
  Speaker 2: the mark by assuming that everybody felt this way about it.
• 36:30
  Speaker 2: And yeah, I mean you can you can get just
• 36:33
  Speaker 2: great quality of music from a fairly compressed rate. Yeah,
• 36:37
  Speaker 2: I agree.
• 36:38
  Speaker 3: Twenty fifteen also, and this kind of surprised me. It
• 36:41
  Speaker 3: felt like it had been around longer. But that's when
• 36:42
  Speaker 3: Apple Music, not iTunes, but the Apple Music streaming finally
• 36:47
  Speaker 3: was launched surprisingly late to the game, supposedly because Steve
• 36:52
  Speaker 3: Jobs didn't like the idea. So Apple and Amazon, who
• 36:59
  Speaker 3: had been selling MP three's just like Apple had, they
• 37:01
  Speaker 3: launched about a year later. So they're both giants that
• 37:05
  Speaker 3: were kind of late to the streaming game.
• 37:07
  Speaker 2: Yeah, Apparently Steve Jobs thought that it was basically piracy
• 37:11
  Speaker 2: to make people rent music rather than own it, and
• 37:13
  Speaker 2: that people didn't want to rent music, they wanted to
• 37:15
  Speaker 2: own it, so therefore subscription streaming services were basically just
• 37:19
  Speaker 2: taking advantage of their users. And he kind of said,
• 37:23
  Speaker 2: if you pay one hundred dollars a year to listen
• 37:25
  Speaker 2: to your favorite song over ten years, you paid one
• 37:28
  Speaker 2: thousand dollars to listen to that song and you don't
• 37:30
  Speaker 2: even own it, rather than just buying it once for
• 37:33
  Speaker 2: a dollar or something like that. And he makes a
• 37:35
  Speaker 2: good point, but he's also leaving out all the other
• 37:38
  Speaker 2: music that you've listened to over that ten year period.
• 37:42
  Speaker 2: It's a weird way to put it. Yeah, it's a
• 37:44
  Speaker 2: little disingenuous, but he was very much opposed to it,
• 37:47
  Speaker 2: and Apple was not about to get into the streaming
• 37:49
  Speaker 2: game while he was alive.
• 37:50
  Speaker 3: He's like, if you're wealthy like me, you'll pay for
• 37:53
  Speaker 3: a different streaming subscription for every song you want to
• 37:56
  Speaker 3: hear exactly, just to make it fair.
• 37:59
  Speaker 2: And that's madness.
• 38:01
  Speaker 3: Pandora, we should Mention was bought by Sirius XM and
• 38:05
  Speaker 3: twenty nineteen, and we should, you know, talk a little
• 38:09
  Speaker 3: bit about how the finances worked today, because it was,
• 38:13
  Speaker 3: you know, there was a bit of a things have
• 38:15
  Speaker 3: regulated just a bit. You know, things really went in
• 38:18
  Speaker 3: the tank. I think that the twenty fourteen was that
• 38:23
  Speaker 3: the lowest point in dollars for the music industry. They've
• 38:28
  Speaker 3: come back now. In twenty twenty two, revenues hit twenty
• 38:31
  Speaker 3: six point two billion, which is about a twenty five
• 38:34
  Speaker 3: percent drop compared to when CDs died. But that's a
• 38:37
  Speaker 3: seventy percent increase from where they were in twenty fourteen.
• 38:41
  Speaker 2: Yeah, I mean that's a that is a low point
• 38:44
  Speaker 2: for sure.
• 38:45
  Speaker 3: Yeah. So they've sort of course corrected enough to where
• 38:49
  Speaker 3: I think they're like, hey, it'll never be the heyday
• 38:50
  Speaker 3: of CDs again, right, but not every Like people are
• 38:54
  Speaker 3: actually paying for music now with these subscriptions.
• 38:57
  Speaker 2: Yeah, And it does turn out that Steve Jobs will
• 39:00
  Speaker 2: absolutely wrong. People are generally totally cool with renting their
• 39:03
  Speaker 2: music through subscription services. I think eighty four percent of
• 39:07
  Speaker 2: music revenue comes from paid subscriptions. Yeah that's a I mean,
• 39:11
  Speaker 2: that's significant. And one two thousand and ninth study found
• 39:14
  Speaker 2: that piracy had dropped because of the affordability of legal
• 39:18
  Speaker 2: ways of consuming media, not because of enforcement, not the
• 39:22
  Speaker 2: threat of being sued by Metallica, but just the fact
• 39:25
  Speaker 2: that it was easier and by this time people got
• 39:29
  Speaker 2: used to putting their credit card info on the internet.
• 39:33
  Speaker 3: The threat of Lars Ulrich's coming into your room and
• 39:36
  Speaker 3: speaking to you for twenty minutes. Yeah, that's enough right
• 39:39
  Speaker 3: there for sure. As far as what they pay, I mean,
• 39:43
  Speaker 3: Spotify's the biggest dog in the market. They have about
• 39:46
  Speaker 3: thirty percent of the streaming market and like you said,
• 39:49
  Speaker 3: more than six hundred million active users. But these royalties,
• 39:53
  Speaker 3: Title pays the most at one point three cents, Apple's
• 39:57
  Speaker 3: point seven, YouTube music point seven. Spotify pays point four
• 40:01
  Speaker 3: cents per stream, same as Amazon and then Pandora's down
• 40:05
  Speaker 3: to point one. You're obviously making a lot more money
• 40:09
  Speaker 3: off of Spotify because they're the biggest player, so it's
• 40:12
  Speaker 3: less per stream. But as an artist, if you're a
• 40:15
  Speaker 3: hit on Spotify, then there's a lot of money to
• 40:17
  Speaker 3: be made.
• 40:18
  Speaker 2: Right Yeah. I think Spotify paid over nine billion dollars
• 40:23
  Speaker 2: in royalties in twenty twenty three, three times more than
• 40:27
  Speaker 2: they paid six years earlier. And there've been studies about
• 40:31
  Speaker 2: how much money is actually made by the artists. There's
• 40:35
  Speaker 2: sixty six thousand artists that make ten grand or more
• 40:38
  Speaker 2: a year on the platform through music sharing, eleven thousand
• 40:42
  Speaker 2: of them make more than one hundred thousand dollars a year,
• 40:46
  Speaker 2: and then twelve hundred of them make a million plus.
• 40:49
  Speaker 2: And of course most of the twelve hundred are names
• 40:51
  Speaker 2: that you've heard of that are already making tons of
• 40:54
  Speaker 2: money anyway. But you know, toward the lower end of
• 40:57
  Speaker 2: that scale, there are indie artists that never in their
• 41:00
  Speaker 2: life would have made a million dollars in a record
• 41:02
  Speaker 2: label deal that are now like making producing, sharing their
• 41:07
  Speaker 2: own music, running their own social media, and they're making
• 41:11
  Speaker 2: a million dollars a year more from their music, which
• 41:15
  Speaker 2: is That's one of the ways that this completely changed
• 41:19
  Speaker 2: the game, not just in taking money away from the
• 41:21
  Speaker 2: music labels, but also in making it easier for independent
• 41:26
  Speaker 2: artists to just exist without the music labels.
• 41:29
  Speaker 3: Yeah, yeah, for sure, I got a couple of things
• 41:33
  Speaker 3: for you here on that line, our beloved Pavement that
• 41:37
  Speaker 3: we both love. Sure Harness Your Hopes was a B side,
• 41:41
  Speaker 3: kind of throwaway song, not throw away, but a B
• 41:44
  Speaker 3: side from nineteen ninety six. It never made it onto
• 41:46
  Speaker 3: their album. It went viral on TikTok last year. You
• 41:50
  Speaker 3: know about all this, right, No, so the song goes
• 41:53
  Speaker 3: viral on TikTok for some reason. And like huge Pavement
• 42:00
  Speaker 3: for eight song from nineteen ninety six got one hundred
• 42:02
  Speaker 3: and forty eight million streams on Spotify. Wow, which, if
• 42:06
  Speaker 3: the math is right, close to six hundred thousand dollars
• 42:10
  Speaker 3: just from Spotify from a you know, B side from
• 42:14
  Speaker 3: nineteen ninety six.
• 42:15
  Speaker 2: That's awesome.
• 42:16
  Speaker 3: That's amazing. So that kind of stuff can happen, which
• 42:19
  Speaker 3: is great. And then I looked up I was curious
• 42:22
  Speaker 3: who the most stream like, the most streamed song ever
• 42:25
  Speaker 3: on Spotify is. My guess would have been a Taylor
• 42:28
  Speaker 3: Swift song. Believe it or not. Taylor Swift has the
• 42:31
  Speaker 3: her highest charting Spotify as far as number of streams
• 42:34
  Speaker 3: go is the forty second highest. What is it?
• 42:38
  Speaker 2: Just so she has so many songs that that it
• 42:41
  Speaker 2: counts for her streams, I guess because she has tens
• 42:45
  Speaker 2: of billions of streams.
• 42:46
  Speaker 3: No, that's for a song like one specific song.
• 42:49
  Speaker 2: Oh oh, I see you're saying in dollar amounts and royalties.
• 42:53
  Speaker 3: No, no, no, in streams like her. Her Her most streamed
• 42:56
  Speaker 3: song is Cruel Cruel Summer, and that is number forty
• 42:59
  Speaker 3: two on the list.
• 43:01
  Speaker 2: First of all, that's Banana rama. And secondly, I think
• 43:03
  Speaker 2: my point still stands. She just has so many songs
• 43:08
  Speaker 2: and variations of her songs that when you put it
• 43:11
  Speaker 2: all together, she has like thirty eight billion streams a
• 43:15
  Speaker 2: year of Spotify. Yeah.
• 43:17
  Speaker 3: Yeah, that's for her whole catalog, which is incredible.
• 43:19
  Speaker 2: So who's number one? That she's way down at forty two.
• 43:23
  Speaker 3: The weekend, which one his song Blinding Lights Wow, is
• 43:28
  Speaker 3: the most downloaded song on Spotify And I did I
• 43:33
  Speaker 3: think it was. I can't remember. I think it was
• 43:35
  Speaker 3: like four or five billion streams. And I did some math,
• 43:40
  Speaker 3: and I may not be right, but if I did
• 43:41
  Speaker 3: my math right, it looks like that that dude has
• 43:44
  Speaker 3: made more than one hundred million dollars on that song
• 43:47
  Speaker 3: off of Spotify.
• 43:48
  Speaker 2: That's just off of Spotify, right, Yeah, that's not including
• 43:51
  Speaker 2: like YouTube music, Amazon music sales of the actual MP
• 43:55
  Speaker 2: three year album.
• 43:56
  Speaker 3: How many ways can I say? Only Spotify.
• 44:00
  Speaker 2: In hindsight, even that doesn't quite make sense. I'm not like, ah,
• 44:03
  Speaker 2: that makes sense. It's funny how the internet can do that.
• 44:07
  Speaker 2: I would have guessed Gongam style, but that's a little
• 44:10
  Speaker 2: little dated, I guess.
• 44:12
  Speaker 3: I just like, if that math is right, that's that's incredible.
• 44:15
  Speaker 2: Yeah, for sure. But that's the kind of money you
• 44:17
  Speaker 2: can make off that. I saw Drake made like three
• 44:19
  Speaker 2: hundred million dollars off of Spotify in a year recently.
• 44:24
  Speaker 2: So yeah, and if you're again, indie bands are now
• 44:27
  Speaker 2: at the table. They can do this all themselves. They
• 44:31
  Speaker 2: can just split it among themselves as bandmates. And you know,
• 44:35
  Speaker 2: if you just hit it just right, you can go
• 44:38
  Speaker 2: viral like that Pavement song did and really make it
• 44:42
  Speaker 2: not just money wise, but your career. You can expose
• 44:44
  Speaker 2: yourself to so many people virtually on social media or
• 44:48
  Speaker 2: streaming music, is what I mean. But also there's an
• 44:54
  Speaker 2: other side to it as well, because record executives haven't
• 44:58
  Speaker 2: gone anywhere. There's still plenty of them, and so when
• 45:01
  Speaker 2: you do have a contract with the label. They'll very
• 45:05
  Speaker 2: frequently be like, hey, this song has to have an
• 45:08
  Speaker 2: amazing hook that's no more than ten seconds long because
• 45:11
  Speaker 2: we want to get it viral on TikTok. Go make
• 45:14
  Speaker 2: a viral video on TikTok. Essentially is what they're saying,
• 45:17
  Speaker 2: and so that's shaping how artists are making music, and
• 45:20
  Speaker 2: a lot of them are not happy about that.
• 45:22
  Speaker 3: Yeah, it's also reshaped, you know, the sort of the
• 45:25
  Speaker 3: album era is kind of dead. I mean, there's still
• 45:28
  Speaker 3: plenty of albums and still plenty of artists doing that,
• 45:31
  Speaker 3: but it's almost, like Livia points out, it almost is
• 45:34
  Speaker 3: like going back to the days of the forty fives
• 45:36
  Speaker 3: in the nineteen fifties where it was you know, these
• 45:40
  Speaker 3: singles are being released and that's interesting. I know that.
• 45:45
  Speaker 3: You know, one thing we should mention is that there
• 45:48
  Speaker 3: is they're trying to get it pushed through now the
• 45:50
  Speaker 3: Living Wage for Musicians Act through the house, where they're
• 45:54
  Speaker 3: basically saying, hey, minimum royalty should be a penny per stream. Like,
• 45:59
  Speaker 3: I know, you make a lot more on Spotify because
• 46:01
  Speaker 3: it's the biggest player, but they're paying four cents and
• 46:05
  Speaker 3: like if everyone paid a cent, that would be a
• 46:07
  Speaker 3: huge difference.
• 46:09
  Speaker 2: Yeah, and if you're like I totally agree with that,
• 46:11
  Speaker 2: you can go to Actionnetwork dot org and look for
• 46:14
  Speaker 2: Living Wage for Musicians ACT. This morning, they only needed
• 46:18
  Speaker 2: four hundred and thirty two more signatures to reach their goal,
• 46:21
  Speaker 2: so apparently it automatically becomes law at twelve thousand signatures.
• 46:26
  Speaker 2: If I'm not mistaken, nice work.
• 46:28
  Speaker 3: I'm glad you put that out there.
• 46:31
  Speaker 2: I am mistaken by the way. But yeah, there was
• 46:34
  Speaker 2: one other thing I wanted to point out to the
• 46:36
  Speaker 2: way that it's evolved. Because there's not a huge gamble
• 46:40
  Speaker 2: in making music like there was when you have a
• 46:43
  Speaker 2: whole production going on in a label and you're actually
• 46:46
  Speaker 2: physically producing the albums. There's way more availability and potential
• 46:52
  Speaker 2: for artists to explore genre bending, genre fusing all sorts
• 46:57
  Speaker 2: of gambly risky new types of music that they would
• 47:01
  Speaker 2: never be able to try if they had like a
• 47:03
  Speaker 2: major album or a major major label contract and that
• 47:08
  Speaker 2: label was not willing to take those risks. So that's
• 47:10
  Speaker 2: another way that shaped it positively.
• 47:12
  Speaker 3: Yeah, I mean, you and me could get together and
• 47:14
  Speaker 3: put out a song and get it out there and streaming,
• 47:17
  Speaker 3: like we could do that.
• 47:20
  Speaker 2: Okay, what should we do? Should we call ourselves pendulum
• 47:23
  Speaker 2: of development? And we're gonna play Both of us are
• 47:27
  Speaker 2: going to play the mandolin, but neither of us know
• 47:29
  Speaker 2: how to play the mandolin? Is the hook?
• 47:32
  Speaker 3: Well, who's our slide whistle player? Jerry? Okay, sure, we're
• 47:38
  Speaker 3: gonna cut her in on this.
• 47:41
  Speaker 2: Well, no, I mean, but she can still be the
• 47:42
  Speaker 2: slide whistle player. Oh okay, great, you got anything else?
• 47:47
  Speaker 3: I got nothing else. This is a fun little trip
• 47:49
  Speaker 3: down memory lane.
• 47:50
  Speaker 2: Yeah, it was agreed. Good choice, And that's it. Everybody
• 47:55
  Speaker 2: for streaming music, which means, of course it's time for
• 47:58
  Speaker 2: listener mail.
• 48:01
  Speaker 3: Yeah, I'm gonna say this is we're sort of correcting
• 48:03
  Speaker 3: our omission of our Minecraft episode when we couldn't think
• 48:09
  Speaker 3: of the kid's name.
• 48:10
  Speaker 2: Oh, Kober.
• 48:11
  Speaker 3: It was a kid in the audience, and we could
• 48:13
  Speaker 3: remember his name. So we got a letter from Boden's mom.
• 48:16
  Speaker 3: Oh hey, guys, my son. Boden was the kid who
• 48:20
  Speaker 3: asked about Minecraft at the Medford show. He was the
• 48:22
  Speaker 3: one with the glasses who also made the joke about
• 48:25
  Speaker 3: being a retired factory worker.
• 48:27
  Speaker 2: Was so great.
• 48:29
  Speaker 3: That'll make sense if you've seen this show. He didn't
• 48:31
  Speaker 3: ask about mobs, and in fairness, there were probably ten
• 48:34
  Speaker 3: other kids after him who also asked about Minecraft. I
• 48:37
  Speaker 3: don't think that's true, so I'm not sure if he's
• 48:39
  Speaker 3: the one you're thinking of. Well, he was, Sarah, but
• 48:42
  Speaker 3: she says regardless, I'm pretty sure he considers this to
• 48:45
  Speaker 3: be his greatest contribution to humanity to date.
• 48:49
  Speaker 2: Man, that kid is so cool.
• 48:51
  Speaker 3: Sincerely thanks from a very grateful parent. And that is
• 48:54
  Speaker 3: from Sarah, so big. Thanks Boden. Yeah, and I'm glad
• 48:57
  Speaker 3: we could get your name out there.
• 48:58
  Speaker 2: Yeah, thanks a lot. Boden, was a great idea and
• 49:00
  Speaker 2: we appreciate your mom writing in. That was Sarah.
• 49:04
  Speaker 3: Yes, awesome.
• 49:05
  Speaker 2: Well, if you want to be like Boden and Sarah,
• 49:08
  Speaker 2: come to one of our shows and suggest an episode.
• 49:12
  Speaker 2: You can also just make it easier on yourself and
• 49:14
  Speaker 2: send it via email, Wrap it up, spank it on
• 49:17
  Speaker 2: the Minecraft, and send it off to Stuff podcast at
• 49:19
  Speaker 2: iHeartRadio dot com.
• 49:23
  Speaker 3: Stuff you Should Know is a production of iHeartRadio. For
• 49:26
  Speaker 3: more podcasts my heart Radio, visit the iHeartRadio app, Apple Podcasts,
• 49:31
  Speaker 3: or wherever you listen to your favorite shows.