To understand why Apple bought Beats, you need to understand Lady Gaga

“Headphone sales? Music streaming service? Wearables? Music label deals? None of the current Beats products look as a credible reason for a deal of that size. Something much bigger is going on,” Michael Vakulenko writes for VisionMobile. “It is not about what Beats is today, but about what Beats can become in the future.”

“To understand what Beats can become we need to understand Lady Gaga first. Lady-Gaga-the-business-model,” Vakulenko writes. “Troy Carter, who discovered Gaga and was her manager till November 2013 being widely credited for much of her business strategy sums it up nicely in his interview to FastCompany: ‘It was more about building a platform on top of music — because music, we realized, sells everything but music.'”

“Jimmy Iovine sees the opportunity in changing the game and ‘building a communication between a fan and an artist.’ In other words Beats Music is not yet another streaming service designed to sell music, but a platform for artists to build businesses and ‘sell everything but music’ as Troy Carter says,” Vakulenko writes. “In essence, Beats aims to become Uber of music by aggregating demand, connecting listeners to artists and empowering the artists to build thriving business on top of the platform. Much like Uber, which promises to end the era of poorly paid cab drivers. Or like Apple App Store, which connects users with app developers allowing them to build business on top of the platform. Pandora, Spotify, Play Music and Amazon that are all designed to sell music, will have very hard time to compete against a platform for building businesses on top of music.”

Read more in the full article – it’s from late May (we just saw it now) and just as valid today and highly recommendedhere.

[Thanks to MacDailyNews Reader “Dialtone” for the heads up.]

22 Comments

    1. Critics of the Beats acquisition are, I think, missing the point by affecting a purist attitude toward the technology business, forgetting that vital businesses evolve in the direction of opportunity, not remain in a well-defined trench that eventually becomes their grave.

      Apple will forever be like Bob Dylan, a rare artist in charge of his own destiny: changing over time according to internal creative forces, unsympathetic to cries of anguish from fanatical devotees who themselves are incapable of change.

  1. 1. Social media is a key ingredient. I’m noticing many up and comming artists (mainly singer/song writer) performing on live webcam type sites/apps lately. This is a great way to connect with fans and build brand.

    2. Beats should allow links to be sent. The link landing page would be an artist’s promotion page within Beats and include one play of the “linked” song/video and samples of other material. I do not want to link to YouTube any longer.

    3. The link could also forward the user to a live web chat jam session as explained in #1. The artists would promote link on Facebook and Twitter.

    1. I just saw my first such on FB this morning. A singer/songwriter in front of a webcam for a Guitar Center (I think it was) competition. I wish I could give him some feedback, such as “lose the OU t-shirt – don’t let the ‘listener’ form an opinion based on anything but the music” and “cut the intro in half – it isn’t really part of the song you are ‘selling'”, but it was good. Not gonna be a hit, but it shows potential, and with some work, he could make it.

      I like the way you are thinking.

    1. As I understand it, the *fare* (“pay” or revenue) might be quite high, but once business expenses are taken out (gas, license, maintenance, etc) cabbies don’t actually make a lot of profit.

      Found out yesterday that a cab license/plate in my city costs $400,000, so the cost is divided between several drivers. If I personally had that kind of money, I sure as hell wouldn’t be driving a cab.

  2. If that Jimmy Iovine and Dr. Dre genius minds are behind the crappy U2 promotion, then surely Apple is on the right track. They only blew $500 million for bad publicity as opposed to blowing billions in acquiring Beats Music something for these type of head scratching punditry: “a platform on top of music — because music, we realized, sells everything but music.”
    Seriously!

    Please, someone bring back Scott Forstall before this ship sinks in its own clueless weight of smug arrogance.

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