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  • Writer's pictureEric Doades

Music in a Post-Stream Era

This week, We’re bringing you one of our favorite experiences of the 2023 Music Tectonics Conference: a fireside chat with Tatiana Cirisano of MIDiA Research.

We called it Music in a Post-stream Era: a Fireside Chat, but the fire was the Santa Monica sun and the chat was on a beautiful rooftop.

As the discussion unravels, we delve into the future of the music industry, shedding light on platforms like Twitch and YouTube's pivotal roles, and the . urgent need to better monetize consumer creation, while acknowledging the industry's highly competitive nature. Explore the industry's expansion, considering fascinating prospects such as derivative content, AI-trained tracks, and branded gear.

We examine how streaming models are reshaping the types of music creators and how AI is rapidly instigating changes in the music industry. Keep listening to hear the gems Tatiana dropped and if you missed out on this year's event.

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Episode Transcript

Machine transcribed

0:00:12 - Dmitri

Hey, hey, welcome back to music Tectonics, where we go beneath the surface of music and tech. I'm your host, Dmitri Vietze, founder and CEO of Rock Paper Scissors, the PR firm that specializes in music innovation and music technology. We are still thinking about all the insights and connections forged at the 2023 Music Tectonics conference. My takeaway this year was all about community. The startups that showed up were further along than ever before. Founders are tackling some of the toughest problems in music and building some of the most innovative solutions, and they have so much energy. You should have been there, but if you were not, you'll love today's episode and also check out our last two episodes for more key takeaways. This week, I'm bringing you one of my favorite experiences of the 2023 Music Tectonics conference a fireside chat I had with Tatiana Cirisano of MIDiA Research. We called it Music in a Post-stream Era a fireside chat, but the fire was the Santa Monica sun and the chat was on a beautiful rooftop. Keep listening to hear the gems Tatiana dropped and if you missed out on this year's event, you got to join us next year. Enjoy.

Tatiana is an award winning music industry analyst, consultant and journalist based in Brooklyn. She began her career at Billboard where, over five years, she wrote cover stories on influential influential artists like Taiman, paula and Travis Scott, as well as features exploring key topics like band camps, impact on the music industry and the booming business of TikTok influencers. Now, at MIDiA Research, she identifies the risks and opportunities in the rapidly changing music market for a client base of leading global entertainment and tech companies. Her key focus areas include the creator economy, fandom and music tech. If you're not reading her stuff, you should be reading her stuff. Welcome Tatiana Cirassano, MIDiA Research. Back in the sun. Last time Tatiana had black and she was like whoa I didn't know just how sunny it was.

0:02:13 - Tatiana

We're really yin and yang here. There we are.

0:02:17 - Dmitri

So awesome. So, for those of you who came to the pre conference online, we had Mark Mulligan, managing partner of MIDiA Research, do a keynote. He also was our opening keynote in 2019, the year of the fires and did an amazing conversation there, kind of really set the tone for all. The Mark keeps setting the tone for music tech tonics every time and during the pre conference he told us that the post streaming era the post streaming era is already upon us, and he said that it was a combination of AI, the creator economy and fandom, which was really interesting. I think. I'm curious from your perspective what are the signs that the focus of music listening is no longer simply streaming?

0:03:03 - Tatiana

Yeah, so I think one of the reasons that we've kind of been calling it the post streaming era is because all of the past shifts are kind of like new eras in the music industry have been tied to format shifts right Vinyl CDs, streaming. But I think we're at a point where we're not going to see a new format right, unless chips are implanted in our brains at some point, which maybe. But what's really happening now is the shifts are in consumer behavior and how they're engaging with music. So we do think we're kind of in this new era of the music industry from that and there's a couple of kind of interrelated trends happening there.

I think the most obvious one is just how much music is hitting streaming services, the vast increase in creators, which means it's just getting harder, because of how consumption is fragmenting, to kind of build these mass audiences around superstars, which is, of course, what the traditional record business is all about.

And it's putting so much strain on the streaming business model too, which is you know I know we'll probably talk about Spotify kind of leading these platforms to actually change their business models. But what's happening with artists and their behavior is they're having to go to all these other places to try and shift their focus to building and monetizing core fan bases, and they can't really do that on streaming, so they're going to social and all these other spaces. And so I guess the other thing about this post-streaming era is, even though consumption is still happening mainly on streaming platforms, the fandom and the culture is happening elsewhere, most prominently, I think, on social these days. And then the other dominant effect of that is we're seeing just the continued blurring of the line between consumer and creator right, where more and more it's fans are actually not just creating with music but creating music, and of course, that changes everything about how we market and monetize music.

0:04:58 - Dmitri

Yeah, I'm glad you brought that up, because it seems like you know. One question is that comes up with this kind of tidal wave of creators, new tools for creating music? Is it competition for the traditional recording industry, for traditional artists, whatever that means? I don't know Traditional changes every six months, right, like what is a traditional artist or a traditional label? But you know what I mean, like the kind of stuff that you listen to as part of your identity, as part of your going out for a party turning on the radio. You know, I don't know what, you know all those things, but I mean, is it really true that fans will be creating music? Thank you as much as they're listening. Will everybody be doing that?

0:05:38 - Tatiana

I mean, I think it's going to take some time. This isn't a shift that we're thinking will happen tomorrow or even next year, but over the next couple of years we do think we'll get to a point where the kind of natural next step of this evolution of music and social media kind of intersecting is that maybe you're not just adding your favorite song to your next TikTok post or whatever is the next social platform, but you're also remixing the stems or speeding it up or slowing it down or adding your own vocal or switching the vocal, and that's all happening within the same app. And the reason we're so keen on this is that has really happened with a lot of other art forms or creative forms already. Right, instagram mainstreamed photography, for better, for worse, by giving the average person really powerful tools to create photos and to share them with other people. And then TikTok did the same thing with videography. And what's happening with music is it's taken a while to get here, because music is really hard to simplify into a phone screen or onto a social platform. But of course, what's coming in to simplify that is AI. And now you have all these tools where the average person can play around with the stems of a song or even create their own new song.

So we do think that's accelerating that shift of music's sort of Instagram moment is what we call it, but I think it will take time.

And to your point about the competition that is, the biggest question for me is I think we're already at a point where consumer creations are starting to become not just additive marketing and promotion for songs, but they're actually starting to compete for people's time.

But I do think that ultimately, these types of tools for fans will unlock more creation than actual consumption. So I don't know that. I think the thing that fans like about this is the process itself of playing around with this music. I don't know that they're actually and sharing it. I don't know that they're actually wanting to go and listen to those songs afterwards. And one of the analogies for that is if you look at sped up songs, right, the music industry has responded to the trend on TikTok by going and releasing those versions on Spotify, but the streams aren't that high compared to the uses on social media. That's really what it's for is for people to play on social, not for them to consume. So I think there's going to be more creating happening, but I don't know if it's going to be actually that much consumption of that.

0:08:07 - Dmitri

Right, it's not like you're seeing Instagram reels and TikToks on Netflix and Hulu. It's sort of like. In a sense, it's kind of like that and that makes me maybe flip it on its head again and say, well, if it's creating a different type of experience, is it actually competing? I know Mark and you guys at MIDiA like to talk about attention and how much time people are spending, and that actually, I think, was his first keynote. It really was kind of about we were. He talked about how entertainment and media entities were not just competing with each other, but they were competing with sleep. And then the dude from Netflix said and we're actually winning, you're sleeping less, you're consuming more content and can confirm yeah.

But then, like a year later, mark was saying something along the lines of there's literally no more time. He's like now we were competing with window gazing, like just spacing out, and nobody does that anymore as well. So in a way it's like are you competing for time, maybe, but maybe also you're just filling other time, or it's a different way of doing stuff. I mean, I think it's interesting what you say. Yeah, people are interested in creating, but nobody really listens to it the way they listen to music.

0:09:19 - Tatiana

So maybe it's a new category or something like that, but it still has to be taking time away from something else, which is maybe their consumption of music on streaming. No, it's homework, it's definitely homework.

0:09:28 - Dmitri

It's homework and chores and doing work for your employers.

0:09:33 - Tatiana

This is why I think it's all the more important that we need to start thinking about how to better monetize this or take advantage of this opportunity as artists and as rights holders, because, like I was saying, this isn't just about marketing and promotion anymore. It's becoming another thing that people are spending a lot of time on, and I think that opens up these opportunities for things like selling as an artist, selling your StemPacks on social to your fans, or what Grimes is doing with Elf Tech is fascinating, where fans are able to play around with her vocal, and then there's the option to release it professionally, at which point she's taking a share of the royalties. So I think we need to start thinking more about what monetization looks like yeah, I got you.

0:10:14 - Dmitri

So you're saying they may be spending more time on creation, but if artists can capture the imagination and spirit and time that they're using for creation by monetizing something that maybe costs more than a fraction of a penny of a stream, then it's still related to the traditional artists.

0:10:33 - Tatiana

And you're seeing, I mean social platforms are starting to try and charge subscriptions now. This has been like a thing over the past couple of weeks and they're starting to shift from paying users to create with all those creator funds to actually charging them to create, right. But maybe that is where it goes with music is. Maybe there's a premium tier of TikTok that lets you play around with music on it or whatever it is. Or maybe you buy things you know $0.99 for a STEM pack within the app and it's an in-app purchase or something. I don't know. These are just ideas. No-transcript.

0:11:11 - Dmitri

All right, we'll probably come back to some of that, but this week you kind of alluded to this, that Spotify kind of there was news that they're changing their model related to a threshold, and maybe first, if anyone missed the news, because it literally came out during Music Tech Tonics what exactly was the deal? Did you catch it?

0:11:29 - Tatiana

Yeah. So, by the way, credit to Mark Mulligan, who broke this news on our company blog while he was on vacation, which is the most Mark Mulligan thing to ever happen.

0:11:37 - Dmitri

Which is the reason he's not here.

0:11:39 - Tatiana

He really did want to be here, but anyway, but what Spotify seems to have done I mean, the details are still not really fully public, I don't think they've actually announced anything, but it seems to be that they're creating a minimum threshold for the streams that you have to garner on a song before it can start collecting royalties. And so what happens from that is these hundreds of thousands of long tail artists that were individually making pennies on their songs, all of that added up, which is a substantial sum, gets put back into the royalty pot and goes to the artists that are past that minimum threshold. And it's a really complex thing because on the one hand, I think sorry, you probably had a question.

0:12:16 - Dmitri

Go for it.

0:12:18 - Tatiana

I think that the threshold actually makes a bit of sense and it's something that Twitch does this or I think YouTube does this, other platforms do this and I've actually written about it in blogs as a potential option. That does make some sense, but it's also a very calculated move to take the increasing market share that independence are making up and just make it disappear and look like it's going back into the bigger labels and the bigger artists. So it's a complicated thing. I'm disappointed that the stuff that has been tested out with Deezer that had to do with measuring fandom and factoring that into royalties has seemed to have been forgotten about a little bit. I hope that that gets picked up again. But yeah, that's my understanding of the deal thus far and my top of mind thoughts on it, but I'm still kind of ruminating.

0:13:10 - Dmitri

So it feels kind of related to something I wanted to ask about. Regardless. We were talking about this kind of tidal wave of creation and this longstanding kind of industry and artists, even touring artists, et cetera, now that everyone's making music basically, or can be. And I'm curious what you think about the record label Sorry, the record industry being threatened by this, and how should labels and even streaming services be thinking about this new music creator economy?

0:13:39 - Tatiana

I mean, all this talk about fixing the streaming business model is kind of just leading to pushing money around in the same pot rather than actually growing the pie, which I know is something that you've talked about before. So I think we really need to be thinking more about how to actually grow that pie, and that's where all these conversations about monetizing and fandom better come in. That's where I'm starting to think about how do we monetize consumer creation? I think it's competitive unless we're able to figure out how to engage more with it, how to monetize it, how to turn it into a product. So I think much more needs to be done than just shift around the money in this streaming royalty pod.

0:14:24 - Dmitri

Right, and it's funny when you think about this competitive aspect to it you've got. Maybe it starts with derivative content in a way, which maybe I mean shit that goes back right, like DJs have been spinning other people's stuff and then remixing it and then sampling people's stuff. That's all derivative, and maybe before there was a business model. I mean, now you have things like Tracklib, where you can pay for samples, and you have ways to monetize the original creators in a DJ set, things like that, and in the PROS too. And but you have, you know, artists on Beatstars that might be selling beats for 20 bucks or 100 bucks instead of fractions of pennies I don't know if it adds up the same way. Or you have, like you mentioned, grimes, who's gonna take a cut on every one of those AI tracks trained on their songs. Isn't that a net positive for artists?

0:15:17 - Tatiana

I think it is, I hope it is and I think, if you have, I think, with especially, how much AI is lowering the barrier to entry, to getting into music making, I think we can increasingly expect artists to have a bigger portion of their fan base, be making music themselves or engaging with music themselves, whether it's casually on social media or as a hobbyist or as a passion project or whatever it is, and then we can have the music industry maybe down the line, not tomorrow again, not next year, but down the line.

Start to look maybe more like the sports industry, where you're selling sneakers and cleats and basketballs to tons, millions of people who are doing this recreationally or training or in their you know, in their leagues or high school, whatever it is. So you can start to kind of have more things that you can market to your fans, whether it's branded gear or STEM packs like we've been talking about, or things like that. So I think in the end it will be a net positive for artists and you think about, like this example with Grimes, she's essentially able to collaborate with an endless amount of people and be driving the royalties from that back to back to her. So I think it does end up in that positive.

0:16:33 - Dmitri

Yeah, I mean, I guess if you think about it as competition for the record industry, that's kind of like one one lens to look at it's competition for the old record industry, but we need to be innovating anyways.

Right. And then that makes me I mean, some of you have heard me say this either on the podcast or some of the sessions where I just jumped up even though I was on the panel and talk about opening up. Are we opening up a new aisle in the grocery store as opposed to trying to cram more stuff on the same shelf? And, you know, is it that a new category can coexist with this kind of music that we listen to now?

0:17:07 - Tatiana

I love your analogies always.

I think it is a new aisle in the grocery store, and the other thing that that I think about a lot is I think that there, as much as this is like unsettling to a lot of artists and a lot of a lot of rights holders, I think it's actually could be exciting to a lot of artists, on the other hand, to be finally making money from and engaging with fans around the music itself, not these other things. You know. I think artists have been kind of pressured to earn and engage with fans in all these spaces that aren't the actual music, and I think there are artists, like maybe Grimes in this example, who would much rather share their vocal model with their fans and earn revenue from that than create a Get Ready With Me video or like whatever they need to do to like, build their social presence or these other places that they're having to engage with fans on.

0:18:03 - Dmitri

So, yeah, I'm glad you brought that up because there's been a lot of conversation about super fans in the industry as well, and I don't know, when I first started hearing that term or that concept I was thinking like Beetlemania. If you've ever seen those old videos with these girls losing their shit over these British guys showing up in America, that to me is like crying, like dying, like breaking down and stuff, and I think that's still. You know there may be some Swifties who do that as well, but I mean, by some accounts you think that super fans are saving the music industry and I'm curious what you think. Is that true?

0:18:41 - Tatiana

Well, it's funny. It's all kind of it sounds funny and a bit ironic because you're like, well, if we haven't been focusing on fans this whole time, like what are we doing? But I do think that you know, the streaming era, however inadvertently, has taught consumers to be a bit more passive about their music listening. It's taught them to focus their listening and their fandom around songs and it's a lot harder to get them to make the jump to the artist and their larger catalog. So, and streaming is again monetizing everyone the same, everyone's $9.99 a month, whether you're a super fan or not. So I think that there is this need to, you know, re-extract those super fans and sort of cater to them a bit more. And I think there's widespread agreement with that from the music industry. But there's a lot of nuance to how you go about that, because if we've been teaching consumers to be a bit more passive in their listening for the past decade, we can't expect these first experiments in fan monetization to just like automatically, like be a huge success. What comes to mind, like that people are expecting is, like you know, that Simpsons me, and where he's like holding the money with like a fistful of cash, with like a determined look in his eye. Yeah, you see it. So far that's kind of, I think, what the record industry is imagining, but I think it's going to take a bit more to like recultivate those fan bases that haven't been getting as much attention in the past couple of years, and I think there's also more attention that needs to be paid to what fandom even means today and what fans actually want, because I've noticed some interesting stuff in the data that was unexpected. Like I've had this conversation with a couple of you here that we did a survey recently where we were asking consumers what they'd be willing to pay for essentially out of, like an artist direct subscription, and maybe five years ago, the things that would drive them to pay would be behind the scenes content and access to the artist Q&A is things like that. But those things actually fall at the bottom of the list today.

Because, yeah, we had this conversation, because, probably because you know, this stuff is ubiquitous in the social media era. Like, all artists are going on Instagram live and posting all this stuff online and it's no longer seen as valuable from fans. So what they actually want is early and exclusive access to tickets, music and merchandise. So they just want to get what everybody else has early, because that's what's rare and scarce and therefore valuable today. So I think it's really exciting that the music industry is agreeing. Okay, we need to focus more on super fans, because this is something, by the way, that Mark has been screaming from the rooftops for like 10 years and he's very excited about this too. But I think we need to be very careful about how we go about that and not rush to monetize something that we haven't really spent time cultivating.

0:21:27 - Dmitri

I think part of my issue with it is that I don't feel like a super fan, like my whole life is dedicated to music. I grew up playing music, I love listening to music and I don't feel like a super fan, like I don't you know, like I've had team members who want to be backstage at a show and I'm like I don't want to be backstage, that's fucking gross. I want to be like in the center dancing, or if it's a quiet venue like right there, where I can hear it really well and just really I want to be a fan of the music. I don't want to be a fan of the person, necessarily. And so how do those people fit in? I mean, do we fit in?

0:22:01 - Tatiana

You touched on something so important, which is part of what I'm saying about better understanding fans is there's so many different types of super fans I had this conversation earlier this week about I think some of them are here about artist fans versus music fans, where you have some people that are super fans of one artist but all they do is listen to that artist and not even as much as they're spending time, you know, obsessing with an artist talking about them buying their merchandise, watching all their content, like they're just obsessed with that artist and the music is actually secondary, whereas for the music fan, which I fit more into, that is I just I'm driven by discovery more than I am by like loving one particular artist, like I love, just like finding new music all the time and listening to lots of things.

That's very, very different and you monetize that differently because that means I'm a valuable streaming consumer but I'm not that valuable of like an artist super fan merchandise consumer. So there's a lot of nuance to it.

0:22:56 - Dmitri

Cool, that's interesting. Last year you introduced this concept of a casual creator here at the Music Tech Silence conference and I'm thinking about, like, if you think about what you just described as maybe a spectrum I don't know what the X variable and the Y variable is, from super fan to whatever that other music fan you call it we also talk about maybe it's crate niggers, the discovery people or whatever. I don't know what the X and Y variables are like how many artists versus how much listening time or something else, or how much money spent versus how much time listening. I don't really know. But the casual music creator almost seems like they could exist on that same spectrum, or they bring it to another dimension or something like that, and you almost could think of them on a spectrum with independent artists. And there's been so much conversation in the music industry about independent artists and I'm curious why has there been so much conversation about the independent artists and how do they relate to that casual creator?

0:23:56 - Tatiana

Well, I think that the spectrum is getting wider, so like to back up a little bit. I think of course, there's been so much interest in the independent side because the artists the self-releasing artists' sector we consistently see as the fastest growing of creators at Midea. But what we're seeing is within that category. So these are artists who are self-releasing their music through a distributor like TuneCoreCD Baby straight onto streaming services. What we see is that there's many different types of creators within that in terms of what their aspirations are. So you might have heard me talk about this before if you've seen me at MusicBiz or something. So sorry if this is a repeat, but we looked at kind of the aspirations of the artists that fall into that sector in one of our creator surveys and we found that actually the creators are pretty evenly divided between being passionate about music and trying to pursue a full-time career and those who are passionate about music but not trying to pursue a full-time career. And these are still the self-releasing artist category. These aren't hobbyists, these are people who are releasing onto streaming, who are on Spotify, and 35% of them aren't trying to pursue a full-time career. Yet because of that, because they don't rely on music for income. They're actually willing to spend more annually on music-making tools, on gear. They're still willing to spend on marketing because they still want their music to be heard, even if they don't care about making money off of it.

And if you want to think about wait a minute, what is that category? It's probably a lot of you. It's the person who is DJing on the side as a passion project and loves it and is marketing themselves, but it's not their main source of income and I find that actually that's a lot of people that work in the music industry. But how this all kind of relates to what we've been talking about and the casual music creator is. You know, I think the creator tools and services industry has always been built around and the label model has always been built around like what creators are earning, whereas now it's also about what they're spending, because you have all these folks who are loving to make music as a passion project but not earning income from it, but still want to spend on it, and there's just this broadening spectrum of types of creators and aspirations and et cetera. So, yeah, that was a lot, but that's how I would answer that that's great.

0:26:17 - Dmitri

We have like two more questions in three more minutes. Where does AI fit into this conversation? We had lots of conversation about it. It's kind of the topic of the moment. We're not a flavor of the month conference, so we didn't make it all about AI, but we definitely needed to talk about it. So we had a couple of panels and lots of great demos on it too. I think everyone's kind of grappling with what it means and obviously AI is a very broad category. We have people who are doing data analysis and monetization, optimization and so forth, and also creation and stuff. But where do you think this fits into the conversation?

0:26:48 - Tatiana

I mean it's really underlying at all. It's really what's driving and accelerating all of these trends, which kind of speaks to a point that's been made that this isn't necessarily that new, like AI has been with us for a long time. A lot of artists have been creating with AI for years and years, and so it's really more so accelerating pre-existing trends, I think, than necessarily creating that many new ones. Like you have more people making music. That adds to the streaming platforms being oversaturated and the streaming model kind of breaking under that pressure. That adds to fragmentation and artists not being able to build mass audiences as easily anymore. It's more about the niches and those core fanbases. It's what's driving the consumer creation trend that we're talking about. I think it really is just like that. It's what's underlying everything that we're talking about.

0:27:37 - Dmitri

Yeah, Okay. My last question how will music sound in this post-streaming era?

0:27:42 - Tatiana

I love that question so much.

I mean, I guess that kind of relates to AI too, because I think what I am always thinking about with this is, like you know that Marshall McLuhan quote. It's like the medium is the message. That is like put that on my tombstone which is basically, you know the format that something is delivered in changes, how it's perceived, and the way that I kind of apply that here is, every time there's new technology or you know a new format shift, it's asking yourself what does that incentivize? How does that change the behaviors? And I think that with streaming, as an artist you're incentivized to sound like everyone else, because that's what gets you put next on the playlist or on the algorithmic session. You know, if you sound like Drake, you're more likely to come up next in the Drake radio station or whatever it is.

My friend and colleague, Dan Runsey of Trappital wrote a really good article about this, saying Drake has succeeded. No offense to Drake, but he's succeeded because he's consistently good rather than being occasionally great, and consistently good is rewarded in the streaming economy, not being occasionally great. So anyway, all that is to say like we've ended up with in the streaming era, what you're incentivized is to kind of just sound like everybody else. But I wonder if AI will be the thing to absolutely flip that on its head, because if you sound like everybody else, it's that much easier for someone to go into a generator and say, make an AI Drake track, which, of course, is exactly what we saw.

So I wonder if artists in this new era will be more pushed to be constantly reinventing themselves and be creating things that sound like nobody else. That's also kind of like my hope, I guess. And then I think the thing I would leave you with on that is I think we're reaching the end of static music, where everything leads up to the release of a song and then it's the finished product and that's the end of the story. I think, increasingly, when you release a song, it's just the beginning of its life, and what you're really releasing are the building blocks for other people to play with. And yes, that's scary, and I'm not here to tell you how I feel emotionally about any of this. I'm here to tell you what the trends are showing and how we can adjust based on it. But I think that's kind of the future of music is fluidity.

0:30:06 - Dmitri

Wow, that was great, Tatiana Cirisano. You always bring it. Amitri MIDiA Research great to have you at Music Tech Tonics every time. Thanks for listening to Music Tech Tonics and, while you're there, look for the latest about our annual conference and sign up for our newsletter to get updates. Everything we do explores the seismic shifts that shake up music and technology, the way the Earth's tectonic plates cause quakes and make mountains. Connect with Music Tech Tonics on Twitter, Instagram and LinkedIn. That's my favorite platform. Connect with me, Dmitri Vietze, if you can spell it, We'll be back again next week, if not sooner.

Music Tectonics at NAMM 2023

Let us know what you think! Tweet @MusicTectonics, find us on LinkedIn, Facebook and Instagram, or connect with podcast host Dmitri Vietze on LinkedIn, Twitter, and Facebook.

The Music Tectonics podcast goes beneath the surface of the music industry to explore how technology is changing the way business gets done. Weekly episodes include interviews with music tech movers & shakers, deep dives into seismic shifts, and more.


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