A guest tries out a VR device at Fanfest during the 2018 BET Experience at Los Angeles Convention Center in Los Angeles, California. (Photo by Rich Polk/Getty Images for BET)
In early October, I posed an open call to my Twitter followers to name what they thought were the most overrated and underrated music-tech stories of the year.
A handful of polarizing topics emerged from the responses. Some users claimed Spotify was overrated because of its dominance over the current music-tech headlines, but deemed streaming overall as underrated because of its deeper impact on artists' livelihoods, particularly with the ongoing evolution of algorithmic recommendation. Likewise, while blockchain was mentioned several times as overhyped, some users argued that the disruptive implications of decentralized data and micropayments for artists could not be ignored.
The most-cited “overrated” topic by far, more than streaming or blockchain, was virtual reality.
At large, VR has already had a profound impact on sectors as diverse as filmmaking, healthcare, retail, Olympic sports training and automobile marketing—but it seems like many music professionals still aren't convinced about the tech's long-term staying power.
In replies to my tweet, users cited reasons like low monetization, rudimentary feedback tech and lack of added value on top of already-existing experiences (e.g. going to live shows in person) as the primary reasons VR still falls short of a meaningful use case for music. Several replies even compared VR to the short-lived 3DTV, in the sense of being more akin to a shiny, gimmicky object than to a truly game-changing product.
It’s important to note that what someone thinks is “overrated” depends heavily on that person’s motives, goals and values. In the case of professionals who make their living off of selling albums or concert tickets, their motivations revolve largely around revenue and exposure—and so far, VR hasn’t delivered on either.
More specifically, much of the music industry perceives an oversupply of content and distribution for VR music apps with no tangible financial return to match. There is a crowded landscape of event promoters like Live Nation and AEG, as well as content owners like Universal Music Group and Warner Music Group, that are investing heavily in VR extensions of their core products; specialist tech startups and developers like NextVR, MelodyVR, TheWaveVR, Harmonix, Magic Leap, TribeXR and Endless Riff that are building VR applications for said content owners; and platform partners like Hulu, Microsoft and Facebook's Oculus that provide distribution support for these applications.
At least from the vantage point of sales, this oversupply has vastly under-delivered on its hype. The estimated revenue from all consumer VR contentin 2017 ($853,000) was only 0.005% of global recorded music revenue that year ($17.3 billion), and just 0.008% of Live Nation's annual concert and ticketing revenue alone ($10 billion).
Comparing global revenues for the recorded music and VR industries in 2017 (shapes not to scale).CHERIE HU
Convincing stakeholders about VR is not only a dollars-and-cents problem, but also a design problem—and design is arguably inseparable from business when it comes to scaling emerging tech.
With a few exceptions (which I will discuss later in this article), the vast majority of high-profile musical VR applications released to date have not truly taken advantage of VR's unique capabilities as a technological medium. By copying and pasting existing business practices and UX assumptions into VR, these applications profess incomplete or inaccurate rhetoric around "accessibility" and "agency" that don't actually drive incremental value for fans, or for sellers.
This discrepancy can be explained using what I call the “science-fiction payphone problem.” I'll illustrate the term using a classic example: the original Blade Runner film from 1982.
In the film, Harrison Ford's character Deckard makes several calls to other characters using a "videophone," which is essentially a glorified payphone with a VHS-quality video screen glued on top. Incidentally, the film is supposed to take place in a futuristic 2019, but it makes a faulty assumption that human beings will still be using payphones as their primary form of communication by then. Indeed, we are still in 2018, and payphone usage and funding have already declined sharply around the world.
Similar missteps pervade classic science fiction: Back to the Future II also prominently featured payphones and fax machines—both of which were prevalent in society at the time the film was made, but are widely considered obsolete today.
More generally, the "science-fiction payphone problem" refers to how we often assume the continuity of our previous experiences, and subsequently bring our accumulated biases with us, when trying to predict the future.
How does this problem play out in the context of VR and music? Let's first examine the business side.
Because corporations are incentivized to preserve their core business lines, they tend to judge the viability of emerging technology using pre-existing revenue models. Today, the dominant revenue models in music and entertainment include advertising, paid subscriptions and freemium or "free-to-play." Streaming as a distribution channel continues to rise in influence, accounting for 75% of U.S. recorded-music revenue in the first half of 2018 (and 38.4% of recorded-music revenue globally in 2017).
Unfortunately, none of these above business models will work for VR at its current scale, which has perhaps left some entertainment execs disillusioned.
Advertising would fall short because VR has yet to deliver the eyeballs and impressions that brands want (although the active user base on some VR platforms is growing quickly). Free-to-play would fall short because VR doesn't have the scale to make the model's minuscule conversion rate—between 2% and 5%, by some reports—worthwhile. And with subscriptions, despite the oversupply of musical content and distribution in VR, there still isn't nearly enough content to support the long tail of discovery and keep users satisfied and engaged enough from month to month to want to pay continually for fresh content (à la Spotify and Netflix).
Because of their entrenched revenue demands, traditional music companies like record labels and concert promoters tend to think “outside the headset” when planning VR campaigns—i.e. thinking less about the content inside the VR device itself, and more about adjacent sources of income and impressions that are more familiar to established industry practices, such as online social video content and sales from merchandise and event tickets. As a result, some of the fastest-growing use cases for VR entertainment today are, ironically, tightly tethered to physical real estate: think about the dozens of branded VR/AR activations taking place at music festivals every year, or about the enduring popularity of VR cafés and other location-based VR experiences at large.
Now let's shift our lens from business to design, zooming in on the VR content itself.
The VR music applications that have gotten the most press and the most corporate backing revolve around virtually scaling the live concert experience—such that fans can feel like they have a "front-row seat," or even a special place onstage, without being at the show in person .
For example, MelodyVR, which has licensing deals with all three major labels and has worked with over 650 international artists, got its initial traction by offering VR users the opportunity to experience recordings of otherwise sold-out concerts from the comfort of their own home. A typical show in MelodyVR features several "jump spots" where viewers can situate themselves—e.g. in the back of the crowd, in the front row or right next to the artist on stage left or right. Today, the startup offers a mix of live concerts and 360º music videos, with prices ranging from $1 for an individual track to $10 for a full gig.
While MelodyVR continues to sign new artist and venue partnerships and is investing heavily in R&D, its share price on the London Stock Exchange has fallen by over 73% since its peak, from 18 pence a share on May 1, 2018 (the day it launched officially in the U.S. and U.K.) to just around 5 pence a share as of press time.
A screenshot of a concert by The Chainsmokers at the Alexandra Palace in London, U.K., as experienced through virtual reality app MelodyVR.MELODYVR
Another example of an initiative seeking to scale live experiences through VR is Oculus Venues, a new VR experience under Facebook whose first broadcast was a live concert by singer-songwriter Vance Joy, in partnership with AEG Presents. Unlike with MelodyVR, viewers in Oculus Venues are not in control of the camera angle for the event, but can toggle between solo and social viewing modes. In the social mode, one can chat in real time with other users who are watching the event, and can even see whether they share any mutual interests (as indicated through Facebook Page likes).
While applications like MelodyVR and Oculus Venues are critical early steps in setting the tone for future VR music experiences, they arguably fall short by cloning incumbent business and design practices from the "real-world" entertainment industry into a medium that has far more technological potential.
Many people in the live music sector think of VR’s greatest benefit as widening accessibility to fans. For example, MelodyVR CEO Anthony Matchett recently described the value of his company's content as helping fans reach the "unobtainable," while a live music exec once similarly told me that VR's benefit for the concert sector lies in "taking fans to a place where they normally can't be."
But in many cases, the nature of this "accessibility" still manifests itself only as passive presence, rather than as deeper, active agency. Most VR concert experiences treat the events in question as fixed, written texts to be viewed passively by the consumer. As a result, users end up participating merely by looking, rather than by doing.
In real life, concerts are far from fixed experiences, and avid concertgoers' passions (and motivations to pay up to hundreds of dollars for tickets) are rooted as much in immersion in a social, dynamic atmosphere as in the content itself. The ultimate challenge for future VR concert applications will be to give users access not just to content, but also to a convincing replication of this real-world dynamism in a virtual environment, while preserving the more communal and ritual elements of what makes shows so memorable.
There is also something to be said about whether developers should even be trying to replicate or improve already-existing experiences like live concerts in a VR setting. Even if the VR version ends up being more accessible and valuable to fans around the world, wouldn't that just be the classic case of the "science-fiction payphone problem"—trying to preserve dominant structures of revenue and engagement, rather than redefining the underlying value proposition and user behavior altogether?
In this vein, another useful framework for guiding and evaluating the designs of VR music apps can be found in Janet H. Murray's seminal book Hamlet on the Holodeck. While the book was originally published over 20 years ago, the book still provides a fresh, futuristic framework for understanding any digital technology, and many VR applications have yet to deliver meaningfully on some of Murray’s proposals.
According to Murray, there are four elements underlying any virtual and digital media format: 1) spatial, 2) participatory (i.e. inviting human interaction), 3) procedural (i.e. responding and adapting to behavior according to a set of pre-written rules) and 4) encyclopedic (i.e. capacity not only for storing high volumes of multimedia information, but also for continually generating new information and content that is immediately accessible to others).
By default, most VR music offerings are distinctly spatial—offering three-dimensional, 360º visuals that other formats cannot—but few VR applications nail down the other three characteristics of being participatory, procedural and encyclopedic.
For instance, MelodyVR is inherently spatial, and on the path to becoming encyclopedic in terms of its growing library of tracks and shows. But the application's user experience is only minimally participatory and procedural, in that one of the only ways users can "participate" is by changing the camera angles within the video for a given show; nearly nothing else changes within the VR concert experience in response to human behavior.
Having all four criteria from Murray's framework in place is arguably the base-level requirement for keeping users loyal and engaged enough to then pursue an effective monetization strategy. In fact, we can use Murray's ideas to do comprehensive evaluations of any other VR music app on the market, and evaluate strengths and weaknesses in both design choices and business models, homing in on meaningful opportunities for growth.
A few more examples below:
TheWaveVR. You may recognize the Austin-based company for their work as the official VR app for Steven Spielberg's film Ready Player One, but their core product centers around a platform that enables users to create their own social music and visual-arts experiences.
Both everyday music fans and high-profile artists like Imogen Heap have tuned in to host live virtual DJ sets (calendar here), in which users can talk with each other in real time while DJs control both the music and the surrounding 3D visuals simultaneously. TheWaveVR was also one of the earliest partners with Google's Poly API—which allows anyone to build their own 3D visuals using Google's software Tilt Brush, then import their new creations into TheWaveVR's app.
TheWaveVR's platform checks off all four of Murray's criteria: spatial (users host DJ parties in virtual 3D spaces), participatory (users can participate by creating and curating music and custom 3D visuals, while socializing with each other), procedural (music and visuals can change procedurally in real time in response to user behavior) and encyclopedic (the visual possibilities via the Google Poly integration are seemingly endless)—but, as previously stated, these are mere table stakes when it comes to sustainable monetization in VR. The startup raised a $6 million Series A round in April, with the intention to improve its tools for user-generated content as well as to expand internationally.
Using a total of nearly 1,500 individual sound samples, drawing from both new and existing music by Sigur Rós, Magic Leap developed an interactive, exploratory user experience that automatically weaves these sounds seamlessly together into loops, then visualizes them as fantastical "species" of plants, animals and other objects with which users can interact using their hands to activate the sounds. Importantly, with the Magic Leap One headset, the visual experience also molds to any solid surface surrounding the user (e.g. furniture and walls), rather than staying confined to a screen.
Screen capture of Tonándi, a mixed-reality experience created by Magic Leap and Sigur Rós.COURTESY OF MAGIC LEAP
"It's taking a technique that the band might use in a traditional audio workstation—chopping up sounds into individual elements for looping or sampling—and building it directly into the game engine,” Steve Mangiat, the Creative and Technical Lead for Tónandi at Magic Leap, told me.
The random generation of visuals and sounds in tandem is also unique in the VR/music landscape. "Three-fourths of the elements and representations you're seeing in this project are entirely generated from code," said Mike Tucker, Interactive Director at Magic Leap. "With this project, we're trying to build systems that are unique every time a user goes through them. That's different from typical games, which are the same every time."
Like TheWaveVR, Tónandi satisfies all four of Murray's requirements of being spatial (molding to a physical space in mixed reality), participatory (users have full agency in interacting with and changing their surrounding environment), procedural (the sounds and visuals respond dynamically to users' behavior) and encyclopedic (the types of sounds and visuals one can generate from a pool of 1,500 sources is also seemingly infinite).
The Magic Leap team is known for playing their cards close to their chest—the company raised $2.3 billion before even releasing its first headset to the public—and are being similarly quiet about any future Tónandi projects, in part because developing the underlying technology takes a painstaking amount of effort from both musicians and software/hardware engineers. The business model around more abstract, music-focused experiences like Tónandi will likely be predicated not just on user adoption of the Magic Leap One hedset, but also on whether the technology can become faster, cheaper and more accessible, such that a wider network of artists and developers can also participate and create their own audiovisual worlds.
Beat Saber . A rhythm game similar to Dance Dance Revolution, Tap Tap Revenge and Beat Fever, Beat Saber involves users hitting blocks corresponding to musical notes and beats using a tool resembling a lightsaber. The game became the highest-rated app on Steam within less than a week of its release, and some users have developed their own add-on modules (or "mods") that allow them to build custom songs for other users to play through.
Many of the user reviews of Beat Saber on Steam mention that playing the game is one of the most effective workouts that VR can offer—hence nailing the characteristics of being fully participatory and spatial. As a rhythm game, Beat Saber is also naturally procedural, in responding to user behavior based on a codified set of rules around hitting musical blocks in sync.
Where the game has room to grow and improve is in becoming more encyclopedic with respect to its content. As of now, the official music library within Beat Saber is relatively limited, and user mods for custom songs are unofficial, leading to potential bugs and breakdowns of these mods whenever the game developer issues an update. In addition, the game's primary business model at the moment is simply a standard download mechanism, costing $19.99 to download the game on Steam.
If and when Beat Saber's developers release an official song editor, there is a potential opportunity to generate more revenue through in-app micropayments to users who develop the best versions of songs, and/or to integrate with streaming services like YouTube and Spotify to tap into a truly encyclopedic resource of content and get musicians compensated for being featured in the game (although the underlying licensing framework would be challenging to build).
In short: the music industry is suffering from many of the same problems that other industries are facing when it comes to embracing VR. High-quality headsets are still prohibitively expensive for most consumers, and business models are too reliant on one-off activations at physical locations, rather than truly scalable and accessible tools for global populations.
But these cost- and location-based handicaps will inevitably disappear as technology improves. Music companies would do well to think sooner rather than later about how to take advantage of VR’s unique capabilities to deliver genuine added value to the end user, instead of simply replicating existing practices (and their problems). What does VR look like as a tool and a platform, not just as a passive "experience"? And to borrow from Murray, how can we take advantage of VR's uniquely participatory and encyclopedic potential to offer users a perspective on music that they truly haven't seen before?
Answering these questions might mean setting aside what has worked in the past, and rethinking the value proposition of music altogether.