The labels try to invest and make money on the playlists whereas they are generally composed of genres less dominant on the streaming. The term artificial intelligence fascinates as much as it worries in the music market. So when news reports indicate that one of the world’s three biggest music labels, Warner Music, has “signed” Endel, producing ambient music via artificial intelligence, the negative comments tributary. In fact, Warner’s contract with the company that offers personalized background music based on sleep, location or heart rate is less engaging than it seems. “We have a distribution agreement announced in January. We have not signed them on any of our labels and they are not part of our catalog of artists, “says a source at Warner Music.
Indeed, the label does not take possession of the algorithm used by Endel, which itself is a reappropriation of compositions already created by humans. In fact, Warner will distribute 20 albums in 2019. The company will provide marketing support to the albums and will share the royalties at 50/50. Unlike a contract with a classical artist, Endel does not receive any advance and retains ownership of the recordings. The rise of ambient playlists, However, even though it is only a simple distribution agreement on platforms, such a Warner initiative is a clear sign for the market.
The company is sort of experimenting here to try to find the best way to commercialize music managed by algorithms. This, while health and wellbeing become marketing tools in the sector. As proof, Spotify recently invested in Headspace, while Warner has already taken holdings in health apps like Peloton, Weav or Aaptiv. It must be said that streaming platforms are seeing a growing attraction of the public for ambient music. Playlists become more and more contextual.
The labels thus try to invest them whereas they are generally composed of genres less dominant on the streaming like classical music or the jazz. For her, it’s a good way to make money on this more difficult catalog to sell. Some composers who used to offer their music to companies that traditionally provided royalty-free soundtracks for videos or podcasts, now use contextualized playlists as a new way of life for their creations. Warner will be able to earn money on 20 hours of music with production at very low costs, on ultra-popular lists. Other labels should follow.
Universal launched in August 2018, the playlist “Peaceful Music” on Apple Music, mixing ambient music, relaxing. The playlist had 51 tracks before moving to 113 tracks. But she included real artists like Max Richter or Ludovico Einaudi. Thanks to his agreement, with a company offering background music via the same algorithm, Warner will be able to earn much more and give fewer royalties. The race for the algorithm on the part of the labels is therefore only beginning.
