Sean Parker: Spotify attempting to finish what started at Napster

Sean Parker: Spotify attempting to finish what started at Napster

Summary: Napster's founder argues that most of the traditional limitations of the music industry are now gone, opening the door for Spotify and other digital music lockers.

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SAN FRANCISCO -- Sean Parker's interests in revolutinionzing the music industry, so to speak, are well known from his early days as a co-founder of Napster. His current efforts on this horizon are focused on Spotify.

"These historical limitations that defined the dynamics of the record business no longer any sense," said Parker, while speaking at the Web 2.0 Summit on Monday afternoon.

See also: eBay CEO: Retailers need help with mobile technologies Benioff rehashes same old social enterprise argument

Parker described Spotify as an "attempt to finish" what he started with Napster, being that it is a "dream of frictionless-free, tiered service that enables music sharing."

"We're all trying to figure out what is that next music industry," Parker admitted. "There's a whole set of things we have to figure out when moving to digital distribution."

In the physical world, you can only make so many CDs and there's only so much shelf space, Parker explained. There's also only a limited number of radio stations per market, so there's even less room to promote new artists.

Continuing on, the "traditional gate keepers of music" as Parker described them, ranging from radio stations to MTV, that were "not selecting the music that met the best needs of the public" have been replaced by the online social world.

"The dream with Spotify was ultimately to integrate Facebook and Spotify so that viral distribution could be unlocked," Parker said, asserting that that less than half of music sold today is done on CDs.

Parker offered the example of the band Foster The People, which he said came out of "virtually nowhere," and then within three months of online publicity and promotion on services like Spotify, the once-indie group is now a huge hit.

"I don't think we're ever going to get it completely right," Parker acknowledged. "The world is changing so quickly that it's very hard to get anything right for long."

Parker's aspirations to fix the media industry might not be limited to just music.

"On-demand TV is so screwed up," Parker argued.

Moving back to one of Parker's more notable time and money investments, Facebook, he had plenty of good words to say about the world's social network, but acknowledged that its problem is the "glut of information" that users have to deal with.

"There's good creepy and then there's bad creepy," Parker said, pondering if "today's creepy is tomorrow's necessity."

Parker, originally scheduled to speak later during the summit, replaced Zynga founder and CEO Mark Pincus as the opening speaker.

Pincus had been locked down for the interview a month ago, according to John Battelle, founder and chairman of Federated Media Publishing. But as of the end of last week, Pincus canceled and no explanation was revealed. Let the those IPO rumors continue.

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  • RE: Sean Parker: Spotify attempting to finish what started at Napster

    Um... can anyone notice the difference between a service which openly supported unlimited pirating of music, and a service that allows you to send friends links to the music you've legally got access to and happen to like?
    spark555
    • RE: Sean Parker: Spotify attempting to finish what started at Napster

      @spark555

      Depends how you count. Yes, legally there is a HUGE difference between the two. In practice, one must look from a historical context to see more of the similarities.

      Napster came out circa 1999, and operated until roughly late-2001. that was also right around the time that residential broadband became practical and affordable - some actually credit Napster for being a catalyst for broadband achieving critical mass. CD burners were becoming commodity hardware, and while the release of the iPod was still in the future, that didn't stop companies like Diamond Audio, Creative, or Iomega from blazing the trail.
      On the cell phone front, it was right around that time that the commercials for the Motorola V2397 featuring Carson Daly introduced us to the concept of text messaging (unless you count the text from the movie "Armageddon" that gave most viewers pause). Phones of that vintage were just figuring out how to decode polyphonic MIDI files; nothing supported MP3 in any capacity until years later. If you had mobile internet, it was on a laptop, it was really expensive, and it was 9600-baud, tops, since you still had to dial AOL.

      What Napster pioneered was the ability to have large quantities of songs available at one's fingertips without having to constantly change discs, and take custom sets of that music around without burning CDs that took 15-30 minutes a pop to burn. Similarly, it woke up a couple of people at the RIAA to say "hey, there's this new-fangled internet thingy that people are using to move around digital copies of music files...how do we make money off of that?" Granted, their first few attempts involved litigating and legislating, and it took the iTunes Music store to give them the idea of simply charging a buck a track, but eventually legal alternatives were typically worth the expense as to not deal with the mine field that file sharing software had become.

      Spotify lets users access a vast quantity of music on their mobile broadband enabled devices without doing...basically anything. One pays a bill and listens to music anywere, period. A "spiritual successor" is probably the best description available, but yes, they're more related than they are apart.

      Joey
      voyager529
  • The *AAs Are Out To Kill Any Business That Looks Too Successful

    If you build a profitable business off the back of music recordings or videos, look for the content companies to raise their rates. They have this sense of entitlement to the lion's share of any profits from any deal, if you're doing well, they see that as an affront.

    See how they're busily destroying the value of Hulu and Netflix for examples of this.
    ldo17
    • RE: Sean Parker: Spotify attempting to finish what started at Napster

      @ldo17 Except the creators of entertainment SHOULD be
      the ones that get the lion's share. The question is, can
      you operate with them as partners or not? If they get
      too greedy you get what happens with the cable
      companies, they stop carrying the channel.

      Ideally, if you have a big company do that, you bypass
      them completely and go to the music makers. The
      creators get more money, eventually, that way.

      Hulu was given licenses on the cheap to try and increase
      the market as well as eliminate potential piracy. I mean,
      who is going to bother stealing something you can get
      for free (if you watch a commercial). Netflix messed up.
      Their costs were not the reason why they raised rates.
      Once they buy the DVD, that's it. And you may have
      noticed the huge drop in prices for DVDs of late. It's
      mainly because of the fact people are able to get it
      fairly quickly w/o owning it.

      The streaming deal was a huge screw up on their part. They should have done something like 6 months free, then $2 more a month thereafter or the like, from the
      beginning.

      Prediction? Netflix will eventually become a carrier for
      the content providers, taking a piece of the pie in
      exchange for access to the customers like the cable
      companies only more ala cart.
      richard233
      • Except the creators of entertainment SHOULD be the ones that get the lion's

        @richard233 And who are the "creators" of entertainment? Is is the record and movie companies, or is it the musicians, actors and directors? Guess who get's the "lion's share"?

        The copyright system is not set up to benefit the content creators at all, only the existing distribution channels. That's why they make such a big fuss about "piracy", even as content creators are learning to prosper even more than before in the new environment.
        ldo17
    • RE: Sean Parker: Spotify attempting to finish what started at Napster

      @ldo17 Of course they want most of the money. Netflix ultimately canibalizes existing distribution channels and every person that drops Starz for Netflix means a significant loss of revenue for Starz, so OF COURSE they want more money from Netflix than their current deal offers.

      I don't know how Apple's current deals work, but at one point, i believe they got 50% of the sale! That's a remarkable amount of money and it meant that both labels and artists took a substantial cut, nevermind that it's practically destroyed the album as a medium.

      Sorry, but neither music nor video is all that expensive. If you graph music prices (and adjust for inflation), prices have done nothing but go down. Albums cost almost $10.00 in 80's money ($20+ today).
      notsofast