Spotify: Drake-oil salesmen

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  105. Inflating inflation
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Impeccably bearded Canadian hip hop superstar Drake released a new album last week. Entitled “Scorpion”, it's so far garnered mediocre reviews for its ponderous 25-track length and saccharine production.

Despite this tepid reception, the record has smashed streaming records. So far the velvet-voiced ex-soap actor's latest has reportedly already broken the record for most US streams for one week and the most streams in one day, reaching platinum status in process.

Pretty impressive, no? Well, he did get a little help along the way from Spotify.

The freshly listed Swedish music service decided on the day of Scorpion's release to inundate its 170 million monthly active users (as of the end of last quarter) with recommendations and visual hints aiming to drive the listeners towards Drake's latest.

Just take a look at Spotify's playlist page from Scorpion's release day last Friday, via Pitchfork:

We get why Drake's face was attached to the New Music playlist, but it's harder to understand why he'd be associated with the Ambient Chill. Brian Eno, the Canadian is not.

Cue outcry from customers who felt betrayed by Spotify's indiscriminate pushing of its most popular artist, their indignation perhaps best surmised by Twitter user Spochadóir :

Aside from petty snarks at Drake's music, this episode reveals some of the inner tensions at the heart of the new media economy. In short, advertising is no longer just a rented interstitial space that breaks up content such as a television show, but a terror twilight of influencers and recommendations, where the line between paid-for and created-for has become increasingly blurred.

Take this Drake episode.

Premium Spotify users have been sold on the promise of an advertising-free platform. It's front and center in the promotional page for Premium, as depicted in this graphic from its website:

Now, Premium doesn't promise an advertising-free Spotify platform, which is evident from a quick read of its Terms & Conditions. But the pitch to prospective subscribers is clear: adverts are a distraction, you deserve an uninterrupted listening experience.

Why Spotify think this idea doesn't extend to the user experience of its product, is bizarre, to say the least.

Of further curiosity is the reasoning behind even pushing Drake's record in the first place. As far as we can tell, Spotify does not accrue higher profits from a stream of Drake's music versus the millions of other artists on the platform.

It makes sense for Netflix to push its own content over shows licensed from broadcasters, because exclusive content is a unique selling point and reduces its dependency on established incumbents. But Spotify is playing a different ballgame. The music-streaming platform is simply a vehicle for content it has no ownership over, primarily because of reported long-standing anti-competition agreements between Spotify and its major label suppliers.

Perhaps Spotify thought we couldn't have enough of a good thing. After all, Drake is popular for a reason, not least his excellent turtlenecks. However, its unabashed cheerleading of the Canadian mope-hop star may give its investors some food for thought.

One of the key drivers behind Spotify's investment thesis is its access to user data. For instance, it's mentioned several times in this bull case for the company's shares by Good Water Capital.

We should all know the logic by now: by harvesting more data about your listening habits, Spotify's algorithms can generate superior bespoke playlists, which keeps you hooked on the platform, which generates more data, which feeds the algorithms etc. etc. This a) stops users leaving the platform, as they'll have to reset their musical profile with a competitor and b) perpetually sharpens the instincts of its recommendation algo, attracting new users.

This model underpins the world's most successful platform companies, such as Google's moat to end all moats, its fabled search algorithm.

Spotify, in promoting Drake so wantonly, may have severed the implicit bargain between company and user: we're here to delight you in return for your data (and some money). As to the question of whether users are as willing to trust its recommendations now that the spell has been broken, we'll have to wait and see. Spotify might believe it won't make a tangible difference. After all, Apple's music offering recovered from surreptitiously funneling U2 onto our iTunes in 2014. A crime, some Alphavillains believe, to still be up there with the greatest corporate scandals of the modern era.

In the end, Spotify's pimping of Drake might be as simple as “this guy is popular, and by getting more popular he will help drive revenues higher”. But if that was the strategy, then perhaps the Swedish streaming service needs a rethink. After all, people use Spotify because of its convenience and promised personalisation, not because it knows better than us.

We contacted Spotify to ask about the Drake fiasco and at pixel had not yet heard back. If we do, we'll let you know.

Related Links:
Grand Theft obsolescence - FT Alphaville
Drake plans to use his alleged secret son to sell sneakers, according to Pusha-T - Vulture
The most vicious lines from Pusha-T's new Drake diss - Vulture
Big Ghost presents: the 'Take Care' review
- NSFW (if brilliant) language

  1. WeWrite-down
  2. No deal Brexit is not a hedge fund conspiracy
  3. Europe’s digital infrastructure issue
  4. Let’s give a helping hand to Andrew Yang
  5. Anatomy of a malware scam
  6. ARK Invest’s Tesla model gathers dust
  7. A delirious defence of Uber
  8. WeLiquid: Adam Neumann pockets $700m
  9. Yesterday, in efficient markets
  10. The warm fuzzy feeling of indirectly owning Tencent
  11. The best of Morgan Stanley's Adam Jonas
  12. Apple/Tesla: M&A and heartbreak
  13. Did Beyonce make $300m from Uber's IPO?
  14. Bitcoin is the 10-year Treasury of our time
  15. High resolution music is a solution looking for a problem
  16. Amazon is furious about this negative review
  17. Missing: $500bn of American savings
  18. Blockchain for Brexit: a wonderfully terrible idea
  19. The Bank of Hodlers [sic] (sigh)
  20. Behind the curtain at China Ding Yi Feng
  21. An answer to Mark Cuban's question
  22. Crumbs! It's CRYPTO: the movie!
  23. National Beverage Corp loses its fizz, and its mind
  24. Amazon won't spin-off Amazon Web Services
  25. Mensch! Dan McCrum is innocent, ok?
  26. Europe's $1 trillion tax gap
  27. Why online propaganda mobs are an investment red flag
  28. Davos has produced an amazing new guide on precisely how not to think about risk
  29. When the public relations industry does PR for itself
  30. Who wants to be crippled by student debt?
  31. The bitcoin price is wrong
  32. The warm fuzzy feeling of Goldman debt
  33. “Cryptoassets” are crashing again. Is it time to start calling them cryptoliabilities instead?
  34. Puff the tragic cryptowagon smokes out the Mumsnet demographic
  35. Don't write off the public sector
  36. Initiative Q: an elementary pyramid scheme with grandiose ideas [Update]
  37. Moral investments aren't outperforming
  38. No one is killing it in crypto (not even Woz)
  39. Too smooth: the red flag at Patisserie Valerie which was missed
  40. No, the housing crisis will not be solved by building more homes
  41. Sorry Civil, 'crypto-economics' and 'constitutions' won't save journalism
  42. 'Short-termism' isn't a thing, say Fed economists
  43. Coinbase wants to be “too big to fail”, lol
  44. Regulation and innovation don't have to be enemies
  45. Retailers get so lonely around the holidays
  46. Folli Follie: $1bn of fake sales, and what to learn from the debacle
  47. The new green evangelism
  48. Tilray, how low can it go?
  49. The ICO behind the tragic Everest stunt is now “airdropping” tokens from rockets
  50. Beware the Hindenburg Omen?
  51. The broken conversation about financial regulation
  52. The improbably profitable, loss-making Blue Prism
  53. The EM rout is not made in America
  54. Wages and growth and honestly we just give up
  55. Britain's first blockchain-enabled co-working space isn't blockchain-enabled
  56. There is a FIRE that never goes out
  57. The WeWork Garden of Eden
  58. IQE: lumpy 'Apple' sauce at the pricey Cardiff chip shop
  59. There's only so much a central bank can do alone
  60. Eight questions every first-time buyer should ask
  61. MiFID II: not all doom and gloom
  62. Tesla: getting to Q3 profitability
  63. Turkey contagion fears are overblown [Update]
  64. The chance of an inflation shock may be higher than you think
  65. Sorry Tim, the humanity is not being drained out of music
  66. Digital crop circles
  67. What could go wrong here?
  68. Sirius Minerals: money for a hole in the ground
  69. The Bank of England has a strange idea of what QE achieved
  70. One for the ladies...
  71. 'Of course, many ridiculous papers appeared'
  72. Is a change goin' to come?
  73. The capacity's not there yet (and probably never will be)
  74. Musk and Tesla are not inseparable
  75. Libraries, from Carnegie to Bezos
  76. Crypto & government: from anarchy to amity in the USA
  77. 'I'm sorry Dave, I'm afraid I cannot sanction this Series B round'
  78. RBC, through the FANG barrier
  79. Self-help to buy
  80. CFA: Chartered crypto analysts -- updated
  81. The Netflix dilemma -- updated
  82. Fujitsu's new blockchain offering: really cheap or really expensive?
  83. Nothing But the Shirt on Your Back
  84. Universities of Britain: cosying up to crypto is a bad look
  85. How to make a living in the cult of meritocracy
  86. Oh, the digital humanity
  87. Sports are not markets, predictions ain't investment
  88. Spot the difference, Steinhoff edition
  89. Larry Robbins, a cautionary tale
  90. The node to serfdom
  91. Carney is down with the crypto kids
  92. Samsonite: inventory, excess baggage, and unresolved questions
  93. It might be a long wait for “the equivalent alternative to ICOs”
  94. Don't blame it on the sunshine
  95. In corporate America, brands develop you
  96. One in ten dollars of US housing were anonymous
  97. Should AT&T worry more about its debt?
  98. Who cares if Elon is incinerating capital?
  99. Let’s not try make 'crypto chicks' a thing
  100. Tokens all the way down
  101. Eight-dimensional chess with Elon Musk
  102. A lopsided trade is a good trade, Italian inflation edition
  103. How to buy Italian fire insurance
  104. Atlas bugged
  105. Inflating inflation
  106. Crypto's most devout believers are suffering a crisis of faith
  107. Plus500: past performance is no guide to the future
  108. Noble rot in a shrinking Harbour
  109. In defence of ticket touts
  110. Please don't tell individual investors to buy leveraged loans
  111. RIB Software: the unicorn rainy-day fund
  112. Retail is not dead
  113. Did Soros really give Tesla a “vote of confidence”?
  114. At a crypto conference in New York, it feels like 2017 all over again
  115. Egregious expectations - Intelsat edition
  116. Bitcoin cash is expanding into the void
  117. Stop getting The Flintstones wrong
  118. Bond investors do not care if Argentina is solvent in 100 years
  119. Ubiquiti Networks: of cash and borrowed time
  120. “We're very disappointed in you, Spotify”
  121. 'Sex redistribution' and the means of reproduction
  122. Tesla probably needs to raise capital this year
  123. No entitlement crisis in America
  124. Free cash flow to whom?
  125. Hey crypto bros! Journalism ≠ advertising
  126. Human capital and the jobs guarantee
  127. This is a tech bubble, when's the crash?
  128. The magic of adjustments: ebitla-dee-da
  129. FUD, inglorious FUD
  130. A complex analysis reaches same conclusion as simple one: hedge funds suck
  131. The jobs guarantee and human-capital “nationalisation”
  132. These hedge fund numbers can't be right
  133. The Vomiting Camel has escaped from Bitcoin zoo
  134. Lies, damn lies, and charticles
  135. The world doesn't need more Elon Musks
  136. No, Facebook should not become a nonprofit
  137. Sell all crypto and abandon all blockchain
  138. Immutable ledgers meet European data protection
  139. Amazon is not a bubble
  140. Japan's economic miracle
  141. Have you ever meta crypto joke you didn't like?
  142. Delaware should change its rules to let the light in
  143. Who needs the labels anyway?
  144. Baby Boomers want your family to finance a larger share of their retirement
  145. No, America would not benefit from authoritarian central planning
  146. No one needs to buy Tesla
  147. How to win a debate in the cult of meritocracy
  148. Steinhoff International and the case of Pepkor Global Sourcing
  149. Sorry Jack, Bitcoin will not become the global currency
  150. The “academic’s cryptocurrency” is an elegant waste of time
  151. Cigarettes are the vice America needs
  152. Well that’s one reason to buy yen…
  153. Musicians, don't just blame the labels for your lack of dough
  154. Giving stock away to staff doesn't absolve share buybacks
  155. A penny for Macpherson’s thoughts on the nominal anchor
  156. Monopoly and its discontents
  157. A State of Mind
  158. America is not the least protectionist country in the world
  159. This is nuts, when does Netflix crash?
  160. No Bloomberg, the world's richest people did not lose $114bn...
  161. Someone is wrong on the internet, government employee pensions and passive investing edition
  162. Someone is wrong on the internet, possibly fragile
  163. Someone is wrong on the internet, consumer financial regulation edition
  164. Someone is wrong on the internet: tontine tokens [Update]
  165. Someone is wrong on the internet, road economics edition
  166. Someone is wrong on the internet, wages and the stock market edition
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