
Spotify's Bold AI Gamble Could Disrupt The Entire Music Industry
www.forbes.com
Spotify is developing premium-tier AI music creation tools that could transform passive listeners ... [+] into active creators while generating higher revenue streams.Adobe StockSpotify has a long history of bringing AI-powered features and functionality to users. This has helped it to grow from a startup to a household name in the face of some big competitors like Amazon, Apple and Google.When news leaked of a new Music Pro tier, a feature reports zeroed in on was the upcoming "AI-powered music tool."The Swedish company is open about its commitment to delivering new listening experiences through AI, so its natural that theres speculation this could be a step towards letting users create personalized versions of their favorite songs.Its also further evidence that platform owners are increasingly seeing AI as an opportunity to add premium-tier features that can be used to drive higher revenue.Some background: Artists, record companies and streaming service providers are currently negotiating a major shake-up of the industry with the intention of kickstarting Streaming 2.0.So, what could this mean for the platform that popularized streaming music and the future of how we listen to music?Spotify And AISpotify is a success story when it comes to engaging users with AI.From the early days, features like its New Music and Discover playlists have been built around machine-learning algorithms that match listeners with tunes.Newer features have let users create blended playlists of songs that match two users' tastes and offer suggestions for fleshing out user-generated playlists.Behind the scenes, it uses AI to automate the tagging of tracks to allow them to be categorized by content or mood.And AI insights are also used to power the Wrapped personalized annual summaries of what users have been listening to.Newer initiatives include the AI DJ launched in 2023, which uses AI-generated voice to join tracks like a radio DJ.And most recently, AI Playlists let music fans use a ChatGPT-like language interface to describe the playlists they want.I tried this one recently, asking for background music for reading Lord Of The Rings, which gave me songs that were mostly from the movie soundtrack, and Music for a road trip through mountains," which gave me a stirring mix of opera, heavy metal and video game soundtracks.This all shows that Spotify has a history of looking beyond simple recommendation engines to create AI tools focused on generating user interaction and engagement. And it doesnt look like theyre going to stop anytime soon.Personalized Music Remixes?We dont know much about Spotifys upcoming AI remix tools, but by studying their past form, we can make some educated guesses.Personalized music remixing has been something promised by advocates for AI in the future of streaming services for a while.There are some pretty big hurdles, most prominently the question of rights. Are artists and record companies happy with the idea that a million personalized remixes of their treasured IP could suddenly explode into existence?It's been speculated that this might be why Spotify isnt yet ready to publicly announce a launch date for the new premium tier service.But its a pretty enticing idea. Imagine having the tools to change tempos, reimagine songs in different genres or with different instruments, or replace vocals with entirely different ones at your fingertips.Its about offering ways for listeners to become active rather than passive consumers of music. Although much of this is speculation at the moment, I think we can expect to see Spotify and other streaming services take this direction as they build new user experiences.The Premium-Priced Future Of Music StreamingSpotify serves as a great example of a web and AI-native business with a mature AI strategy, to the point it can create entirely new tools and services for its customers.This is a significant step ahead of those stuck at the stage of simply adding chatbots to the list of ways of doing things we can already do.Perhaps the other insight we can take is that AI features are increasingly being used to differentiate between standard and premium subscription tiers.Weve seen this already, with Google adding Gemini access to its premium-tier Google One subscriptions and X (Twitter) giving paid-up users unlimited access to Grok.I think its fairly clear this will strategy will grow in popularity as AI service providers look to recoup their investment in training AI models and hiring human talent.It can be argued that Spotify has already done a lot to change the way we listen to music by popularizing legal streaming services. And it looks like it still has some new tricks up its sleeve.How will this prepare it for a future where the only certainty is that the way we consume music and other media will continue to evolve? Time will tell.
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