Live streaming has exploded since the pandemic took hold, says Will Page. The question, he adds, is how live streaming and live shows will co-exist in future.
Did you ever imagine reading a book on economics named after Tarzan, the fictional character who swings from vines in the dense jungle, crosses treacherous rivers and fights lions?
Will Page, former Chief Economist at Spotify, the audio streaming and media services provider that gives access to millions of songs, is out with his first book titled Tarzan Economics: Eight Principles for Pivoting through Disruption (2021). It has been published by Simon & Schuster.
According to the author, who is now a Visiting Fellow at the London School of Economics and Fellow of the Royal Society of Arts, “…if the vine we are holding onto is withering, we should have the confidence to reach out for a new one and embrace future opportunities.”
Excerpts from an exclusive interview with the author:
Q: As an economist who studies disruption, what insights have you gained during the COVID-19 pandemic?
A: COVID-19 has accelerated change that was already in place. The question is: How much of that sticks? Music, as a microcosm for everything else, can help get us to an answer. Take live streaming, which has exploded on sites like Twitch, Facebook and YouTube since the pandemic took hold. All those advancements are not going to go away when live music returns. The question is: How will they co-exist? That same question is being asked by so many other organisations and institutions right now. Disruption doesn't give us time to think about the answer. We have to let go of the old vine and reach out for the new.
Q: To what extent has your academic training helped you deal with uncertainty?
A: My academic training helped me question my academic discipline. So much of what is taught in economics today is treated as a given. I was the kid in the classroom with his hand raised, always asking questions about these 'givens'. For example, are we dealing with risk or uncertainty? The former you can calculate and produce an answer that brings broad agreement; the latter you cannot and is more like a mystery where the conclusion will not necessarily provide consensus. It's the ability, the confidence, to step back from the challenges we face and reframe the problem that I hope my book gives your readers.
Q: How did Tarzan enter your theoretical framework?
A: I first heard the term in Norway almost 15 years ago, when the music industry was holding onto the old vine for its life – believing consumers would willingly go back to purchasing CDs and downloads and stop accessing music from illegal P2P sites. That was never going to happen. That old vine was going to let go of you. This visualization of ‘Tarzan Economics’ of knowing when to let go of the old vine and when to reach out to the new is what this book is all about, giving you confidence to know when it's time to go.
I owe the term to a technologist, Jim Griffin, who was responsible for the first digital music file distributed on the internet ('Head First', by Aerosmith, 1995) and has been in the trench warfare of digital disruption ever since. Tarzan Economics inspired me to establish the economic foundations for the music industry to let go of the old vine of ownership.
Q: What are some of the key ideas that you want readers to take away from your book?
A: Principles that are perennial and future proofed that help you get it right more often and wrong less often. Take 'Make or Buy' (Chapter Four), for instance. We always have done and always will be making make or buy decisions, regardless of digital disruption or the pandemic. We're always asking: When should we go it alone and when should we cede control to an intermediary? I'd like this chapter to be referred to in years to come as a way of assembling the pros and cons of each option. What I've noticed is that with so many creator tools out there enabling people to go it alone, it's only those who do who actually realise the benefits of them. Take journalism – if you lost your job working for a newspaper, now you might go to Substack and (a) have more freedom and (b) make more money. This is what we're dealing with now - Tarzan Economics is everywhere!
Q: Of the eight principles, which one is most essential for thriving in a data-driven environment?
A: Big Data, Big Mistakes. We need to apply some long forgotten common sense to our hunger for big data. We need to curb our tendency to commit quantification bias and think only about the metrics we can measure and disregard anything we can't. We need to remind ourselves of the value of listening to the customer as opposed to seeing what that customer has plotted on a data-driven dashboard. I'm really worried about 'quantification bias' as it leaves so much behind. What matters most is being measured least.
Q: Could you talk a little about what growth and recovery mean to you in the context of the attention economy, a concept that you introduce in the book?
A: We all know that attention is scarce. It can be binary – either you have it or you don't – but also stackable with many forms of attention competing at once. If you can make more productive use of attention, your product stands to win. Why wait three minutes for a song to conclude, when TikTok can get you hooked in 30 seconds? If you go back to the browser wars of Yahoo and Google, Yahoo wanted you to spend as much time as possible using their browser whereas Google wanted you to spend the least time possible. Google optimised for attention productivity, and we all know who won that war.
Q: If you were working at Spotify right now, what would you do differently? How does it compare with Gaana, JioSaavn, Amazon Music, YouTube and other players that offer streaming in India?
A: I'd focus on languages. Curation in India needs to accommodate (ideally) 11 languages. I'd also focus on education – the willingness to pay for music is low, but for education it's high. Could we bundle music subscription into the cost of education? Bundling in India is a huge opportunity.Q: How has the shift from selling CDs to monetizing streaming changed the nature of listening and the kind of music that is being produced? I would love your insights on India in particular.
A: It's travelling like never before, and for Indian musicians this is a great thing. Before Spotify launched in India, we used to ask: ‘Could we break an Indian act outside of India?’ Why? Because we had the data on where Indian content was being consumed by city – so perhaps Vancouver was resonating with a particular Indian act, and there's a large Indian diaspora in Vancouver and across Canada. Can we promote to that audience? Media has been sleeping on the diaspora opportunity for decades, especially in Europe which doesn't even have a single market for media goods. Now if India can wake up to this first, grab onto this new vine the fastest, trust me, Indian music could explode. We're talking box office!
Q: What makes people pay for music in contexts where piracy ensures ease of access?
Author Will Page.
A: People pay for convenience, and Spotify is way more convenient than stealing music. They also pay for option value. The fact that 60 million songs are there is an insurance premium, even if you only listen to 60 of them. Finally, they pay for network effects. The more people who use a paid streaming service, the more value that service brings, thanks to sharing and recommendations. If you don't compete for convenience, you’re toast.
Q: When music piracy is equated with theft, does that overlook economic inequalities?
A: I've done considerable work on this, especially around pricing where I developed a pricing formula which asked what share of disposable income Western companies are asking Indian consumers to pay for media content. It was staggeringly high. Getting local pricing right is obviously crucial; if you get it wrong, piracy is Plan B.
Also, going beyond music, how much does the piracy depend on the price of data? When data costs fell in India, YouTube exploded so you can see right there how the success of media businesses is dependent on the networks they use.
Networks in India are getting better, faster, more robust. That means the media they carry will scale even faster. These are exciting times. India is the most exciting country in the world. The potential is there for India to leap-frog decades of legacy systems and build a whole new landscape for media commerce in 24 months. The time is now.
Q: I am curious to hear about your writing process. Your dedication page indicates that much of it was written beside a swimming pool. How did that help?A:
I think best when I swim, and I swam lots during the writing of the book. I had some very helpful swimming pool attendants. They would write my ideas down as I did my laps in a 30-metre pool. I gave them a whiteboard, red pen, and a lifetime Spotify account to say thanks. At the end of every session, I'd dry myself off and then photograph my notes and then write them up. I got fit, and got the manuscript done – all in one. Our local pool here in Kentish Town deserves a special shout out. That said, my crawl is still awful – still dragging my legs and not kicking hard enough.