Embracing Virtual Reality Could Enable Streaming Services To Finally Move Forward [Cortney Harding]

Rhapsody's recent announcement that it plans to launch a VR app is raising some interesting questions about how VR tech will influence the future of streaming services, and if they'll be able to successfully bring it to a more mainstream audience.

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Guest post by Cortney Harding

A few days ago, streaming service Rhapsody announced it was launching a VR app, with the initial content consisting mostly of performances shot at SXSW. The quality of the performances is fairly solid, and while the requirement that all videos be downloaded before being played means that live-streaming shows in the app is still not possible, it’s certainly a pleasant diversion and value add to be able to watch some shows and see what new artists might be like live.

But while this venture feels like a fun experiment, it also leads to much bigger questions — namely, is embracing VR the future of music streaming services? And if services get into the VR game, what does that mean for artists who planned on building and monetizing their own VR content? Can streaming help bring VR to the masses, just like it brought, well, streaming to the masses?

There have been several calls for streaming services to expand their content offerings beyond music, and to this point, a handful have listened and diversified. Tidal, Apple Music, and Spotify have all announced the launch of original programming, and all feature video in some capacity or another. Spotify also features clips from shows like the Tonight Show and the Daily Show, although the value add in this case remains unclear, as most of the same clips are widely available elsewhere. But in an age where the vast majority of streaming services feature the same catalog and price point, video allows them to differentiate without going down the annoying road of exclusive album premieres, a strategy than seems to backfire when you look at the numbers of illegal downloads that generally accompany each gated release.

While consumers have demonstrated a general unwillingness to join multiple music streaming services, they are more likely to belong to multiple video-streaming services. If there is enough different content, and enough of that content is compelling enough to users, then they’ll shell out for video. This is where streaming services can win with VR — if each has enough unique and interesting experiences, then it will make sense for users to pay up.

Of course, getting artists to create that much content and put it inside a streaming service will be tricky, to say the least. An initial investment in recording equipment could bring costs down for artists who wanted to record and distribute concerts in VR — today, it’s still an expensive proposition, although costs are falling. Your average indie band or venue is unlikely to be able to record and distribute a show in VR, and streaming services could open up this opportunity for the masses. The problem comes when those experiences have to live inside the streaming service — artists won’t be able to charge extra fees to watch them. For newer artists, this could work out anyway; if someone finds you on Spotify’s “Discover in VR” playlist, decides you’re worth seeing live, and shells out for tickets the next time you’re in town, that could be a positive. But for bigger artists whose live concerts could be pay-per-view events, this would almost surely represent a loss. And if we’ve learned one thing in the last few years, it’s that services without mainstream content have a very hard time scaling.

And all of this presupposes that other services won’t jump into the world of VR and music, either. There’s nothing stopping Netflix or Hulu from launching their own VR verticals that include music, or MTV adding it to its recent spate of pivots back to the nineties. They’re already relaunching Unplugged; why not relaunch it in VR as well for good measure? Even these options offer an incomplete picture of what the future could look like — I’d put money on a decent number of smart people being hard at work on the Netflix of VR as I write this.

Let’s suppose none of the events outlined above happen, and the lane is wide open for existing streaming services to jump into VR. These services have already done an admirable job bringing what was arguably a new technology to a more mainstream audience, and while streaming numbers certainly don’t indicate everyone is using them, a growing number of people are. Of course, listening to music on a portable device via headphones is something people have been comfortable with for decades, while strapping a thing to your head and pretending to be a concert is still very new and has a higher learning and adoption curve — but so did the old Sony Walkman, back in the day (which incidentally also required you to strap something to your head.) If streaming services were to partner with headset manufacturers and get the technology to all of their subscribers, it could do wonders for the adoption rates of VR.

Despite some potential downsides, it’s worth it for streaming services to follow in Rhapsody’s footsteps and at least start building out VR programs. The technology is ascendant and new enough where an experiment makes sense, and if it doesn’t work, it can be chalked up to an interesting learning experience. VR content will almost certainly move toward the mainstream, and streaming services should act in favor of being too early rather than having to play catch-up. Owning ears is great, but owning eyes and ears is where things start to get very interesting.

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