last rdio music screenshot

Rdio's demise begs the question: are all the pure music streaming services simply on death row? Just counting down the days until their inevitable death. Hoping the law or the game will change before their judgment day. Rdio is on its way to the streaming music cemetery to join Grooveshark and the others before it. The difference this time—it wasn't a lawsuit or a bad user interface—it was simply the bad economics of the streaming music industry.

The brass tacks (jump to):

Rdio had it all

If you ever tried Rdio, you would have noticed two things: (1) a beautiful and intuitive user interface and (2) a music recommendations system that was social at its core. Rdio was released in the late Summer of 2010, over 5 years ago. It was founded by Niklas Zennström and Janus Friis, the founders of Skype. Three years later Rdio added its music recommendations feature that delivered personalized albums, stations, and playlists. And at the beginning of 2014, Rdio finally introduced free streaming options, supported by audio advertisements, which was the model being operated with moderate success by its primary competition, Spotify.

Relative to the other similarly situated players, Rdio seemed to be more music and social focused with a superior user experience. It was unique in the sense that it gave you the ability to connect with other people that like the same music as you. Hence its unique value proposition (UVP) of the best music recommendations from people you know.

Many believed that while it was an early entrant to the streaming music space, by the time Rdio courted the free music addicts, it was too late—they were all already pleased enough with their ad-supported free streaming music service alternatives. This brings us to a big question: are streaming music services really just music distributors (i.e., a CD section at Best Buy) or are they full music platforms (i.e., where you keep your music life)? Right now, the innovation is in creating attractions to scale fast because the margins will never get better as your fixed costs of licensing music are just that—fixed. It doesn't take an economist to discover the difficulty in obtaining profitability.

What about your music collections?

Your relationship with music is different from other products. You can use music as emotional fuel. You can use music to tell your life story. You invest years in collecting, connecting, organizing and curating music as expressions of yourself. Whether it be an album collection or a playlist, the important thing is that it is your expression. They are a part of you.

Imagine you had a library in your house of all the great books that have changed your life. Now imagine that library was 15,000 books and the sections in your library were unique to you (as opposed to the Dewey Decimal System). One day a person comes into your home and says, "sorry, we are going to have to take these books back, but you can replace them all at the new book store." Some of us would probably throw the guy out of the house and guard the library with a shotgun in hand. The collection matters. How you organized the collection matters. When you are feeling down, you know exactly where to go get your smile back. On top of that, it took you 5 years to collect and organize your library to perfection!

If you are a Rdio user, you probably feel a lot like this person. Sad. Five years of hard work is up in flames. And most importantly, a piece of you will perish with your album collection, favorites, and playlists. For all the snobby album purists out there, there will be morning for the loss of a music service, social at its core, that was understated, beautiful, powerful, and easy to use with an album-centric organizational system that was topped off by perhaps the only centralized queue that actually worked intuitively in the streaming music marketplace.

In the short term while the digital music industry is going through growing pains, one thing is for certain—we need a separation of concerns: (1) your digital music vendors and (2) your digital music expression and life. Losing your hard work and emotion fuel every time a digital music vendor can't reach profit margins in an unbeatable market is unacceptable. Playlist file transfer systems need to get better and streaming music services have a duty to create a universalstructure to allow us to take our music life with us before the ship goes down in flames. This is a simple need.

Streaming music—a game only for giants

Digital music distribution has become a game only for the giants of technology and e-commerce. Apple, Google, Microsoft, and Amazon can distribute digital music as a loss leader because their profits are made elsewhere. The problem is that the innovation in streaming music services occurs outside these giants. Beats acquired by Apple. Songza acquired by Google. The list continues. While not perfect, one player that I have been using since learning of Rdio's impending death is a self made monster—Groove Music by Mircosoft.

Microsoft's newly branded service is called Groove Music, which provides streamed content, plays locally stored content, and allows you to move your stuff to it from other providers. Microsoft entered the digital music marketplace with MSN Music back in 2004 about the same time Apple started iTunes. From MSN Music, Microsoft continued music services with Zune and then finally Xbox Music. Out of Xbox Music rose Groove Music. Xbox Music, being a product perceived to be tied to Microsoft's gaming system, confused people, which lead to the need to rebrand and release it as Groove Music. This finally happened with the recent launch of Windows 10. Now its here and it appears to be here to stay.

Groove Music has a relatively simple user interface similar to Rdio and a selection of music with its Groove Music Pass that rivals the competition. With the paid plan, you can download music for offline listening on up to 5 devices. You can also include your personal collection of files stored on your local computer by simply pointing the Groove Music app to the location of the file. Simple. A few fun features of Groove Music include: (i) the ability to automatically download songs you add to Groove Music, (ii) automatically retrieve and update missing album artwork and metadata, and (iii) require sign-in before completing purchases so your kids don't go on a spending spree on your computer. Finally, a really cool aspect of Groove Music is the ability to store your local music on your OneDrive to save memory on your computer. (Negative: no curated playlists or social integration).

music playlists fun

Image by Lechon Kirb.

Put simpler

Can any pure streaming music service make a sustainable profit? Pandora? Spotify? Not yet at least. The dust has yet to settle on the death of Rdio; however, this development confirms what many have been saying all along—the only streaming music services that will survive in this environment are ones that use music is a loss leader to draw customers further into their larger ecosystems, like Prime Music for Amazon or Groove Music for Microsoft. If you were a Rdio user, while you're morning your loss:

Groove Music is a straight-forward music distribution platform. Reward its honesty with a try!Tweet: Groove Music is a straight-forward music distribution platform. Reward its honesty with a try! http://bit.ly/rdio-no-moreShare this

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