7digital boss sees mainstream music fans as "third wave" for digital

7digital chief executive Simon Cole has a bone to pick with £9.99-a-month streaming subscriptions – or, at least, with what he perceives as the music industry placing so much emphasis on that model, it may be missing opportunities elsewhere.

“8% of music consumed in the home is from streaming music services, and 92% is not”.

“I can give you three services we’ve licensed in the last six months, and none of them are £9.99-a-month. Most of the business models in our sales pipeline for the next 12 months are innovative in one way or another, and they don’t involve a simple straightforward £9.99 subscription,” he says.

“The value that the music industry needs from services remains at that level, and frankly so it should. But that’s not how you present it to the customers. We’re seeing companies come to the market with these Comes With Music-style business models, and we think that’s a significant development. We call it the third wave of digital music.”

Cole accepts that the ideal model is “human curation scaled by an algorithm”

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“They’ve got some bigger plans that will link them [the playlists] more closely to radio in terms of those personalities. People trust musicians like Robbie Williams and Alesha Dixon, and that can draw them in,” he says.

“But what we’re working on is where you can jump from one to another. Our vision at 7digital is why should you not be listening to Alesha Dixon on Radio 2, and then click that button to be taken to Alesha Dixon’s playlist, and jump off the live radio? There are some products in beta at the moment that do exactly that.”

there is fertile ground for ‘traditional’ radio to innovate too. “The great opportunity in marketing music is the coming together of radio, custom streamed music and music social network” (we added the last one).

“Since music radio was invented 60 years ago, it has been the way that most people enjoy and discover music. I don’t see that changing unless the radio industry lets it change.”

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