Return Of The Gatekeeper

Making content available on-demand was supposed to put the consumer in charge. Armed with “personalization” tools and backed by social media filtering the viewer/listener/reader would be king, usurping the power of traditional gatekeepers.

But a funny thing is happening on the way to the throne: consumers increasingly are inviting gatekeepers back into the realm, albeit not necessarily the same ones they had overthrown.

guard-buckhm-palace-shst_w_755Speaking at MIDEM this week, MIDiA analyst Mark Mulligan reported that “The percentage of people who make their own playlists on streaming has dropped by 10 percentage points in just one year,” said Mulligan. “The main playlists which people are using are the playlists which are being pushed to them,” by the streaming services, or in some cases by record labels.

Citing data provided by Spotify, Mulligan noted that in December 2014, Spotify’s Today’s Top Hits playlist had 2.3 million followers and generated 35.4 million streams per month. By April 2016 it had grown to 7.8 million followers and was generating more than 120 million streams a month.

Much of that growth can be attributed to Echo Nest, the music data startup Spotify acquired in 2014, which now powers Spotify’s playlists algorithm. Not all curated playlists are generated by algorithms, however.

Apple Music has relied on human-curated playlists since it acquired Beats Music and this week began recruiting big-name fashion designers, starting with Alexander Wang, to create curated playlists for fashion-lovers.

According to Mulligan, curated playlists are having a significant impact on consumer behavior.

“In the earlier days of streaming it was possible to talk about it as an almost autonomous force propelled by its own momentum. Change brought by streaming was the manifestation of user behaviour and technology, with business practices racing to keep up. Now though the picture is changing, Mulligan wrote in a white paper distributed at MIDEM.  “The rapidly growing power base of curated playlists means that many behavioural and market shifts are now being actively shaped and influenced by the playlist curators. Cross border discovery is one such example.”

Using data provided by Spotify, Mulligan mapped the international trajectory of the electronic music track  “Goodbye (feat. Lyse)”, by the French artist Feder, to its appearance on various playlists. 2016-06-09 16-38-24

The strength of that effect puts a lot of power in the hands of the list makers.

Curation has also played a role in the growth of video on-demand platforms, to equally powerful effect. Netflix, the largest such platform globally, offers a heavily curated experience, whether most users notice it or not. While it offers thousands of programs on demand, and users can create their own ques (i.e. playlists), the content they’re exposed to is largely a function of Netflix’s recommendation algorithm.

It’s virtually impossible to browse through Netflix’s entire catalog, or to search it by genre or keyword to do your own, serendipitous discovery. While it may feel as if there is “always something to watch on Netflix,” what you actually watch is largely under Netflix’s control.

Like Spotify’s Today’s Hot Hits and Discover Weekly playlists, Netflix’s curation has greatly shaped consumer behavior, introducing entirely new habits like bingeing, which helps keep users engaged with Netflix-provided content, and by extension with Netflix.

Just this week, in fact, Netflix provided its own illustration of the range of Netflix-induced behaviors with the release of its “binge scale.”

Netflix binge scale

Amazon Instant Video started out with a more user-driven interface than Netflix, but as it’s catalog of titles has expanded, including its catalog of original series, it’s user interface has also grown more heavily curated.

One important difference between the influence of playlists in the music and video industries is that rights owners in the music business have begun to figure out how to use the tools of curation for their own purposes.

Here’s how Mulligan described the role of Feder’s record label in nurturing the playlist-driven success of “Goodbye”:

Though French, ‘Goodbye’s growth story started in the Netherlands, where following its addition to the Hot Hits NL playlist, plays quickly spike and paved the way for a succession of other country specific spikes. Next came a steady accession in Germany via Topsify lists, which became the single largest component of Feder’s success and ultimately saw Germany deliver 41% of all streams during the period. During the prolonged Germany peak ‘Googbye’ was also featured on the global playlist ‘Today’s Top Hits’ which drove an immediate spike in US streams which in turn dropped off just as quickly once it dropped out of the playlist. US streams were thus driven by a global playlist while Germany and Netherlands were driven by local lists…

The longer term, bell curve streaming spike in German listening is the single biggest part of ‘Goodbye’s streaming success. It was driven by prolonged placement in a number of Topsify playlists. Topsify is run by Warner Music, which just happens to be Feder’s record label. What took place is a ‘full stack’ A&R/promotion/monetisation label strategy. One that set out to make a French act a global breakout.

In contrast, video rights owners, for the most part, have not yet figured out how to use the tools of curation in on-demand platforms to their advantage, leaving power largely in the hands of the platforms themselves.

It’s the same reason movie and TV studios have fought so hard against the FCC’s proposal to “unlock” the cable set-top box and allow third parties to create their own pay-TV user experiences. While the proposal deals largely with the delivery of linear (i.e. non-on demand) porgramming, the studios are deeply fearful of losing control — technologically and contractually — over how their content is curated for consumers, particularly if it were to end up being intermingled with on-demand content.

Gatekeepers haven’t gone away. They’re just working a different gate. And they can still decide who gets in.