The music streaming space is a fragmented mess: Bop.fm raises $2M to put it all under one roof
The still nascent streaming music market is in a state of extreme fragmentation, and with newcomers on the horizon it's only going to get worse. Consumers already have to choose among Spotify, Rdio, Deezer, Rhapsody, Beats, Amazon Prime Music, and coming soon YouTube Music Pass. And while there's some debate as to whether the market will become increasingly consolidated or if there's room for multiple victors, for now there are a slew of streaming options with often little to differentiate them in terms of function.
But while a crowded market can offer many benefits to consumers, it can create conflicts as well. For example, what happens if my friend shares an Rdio link but I use Spotify or Beats? I may load up Spotify and search for the track myself, but more likely I'll just keep scrolling through my Twitter feed looking for the next quizzticle. (Am I not human?) And if the future of music discovery is social, and many believe that it is, the industry needs a far more efficient user experience for sharing tunes.
That's where Bop.fm thinks it can help. A Y-Combinator alum referred to by some as "The Switzerland of Music," Bop pulls in streams from Spotify, Beats Music, Deezer, Rdio, Soundcloud, YouTube, iTunes, Amazon, and Google Play so users can link to or create playlists of songs on a single platform that works no matter what service you subscribe to. Today, Bop has announced a $2 million seed round from Charles River Ventures, SV Angel, Y Combinator, and others. The company has also unveiled Verified Artist pages where artists can curate and share playlists. Some of the first artists to sign up include Lil Wayne, Paul McCartney, Snoop Dogg, and Paul Simon.
Bop CEO Shehzad Daredia, who led user acquisition at Kayak, tells me that the tool functions in part through public APIs and also through partnerships with companies like Beats and Deezer. Bop has also partnered with Rap Genius to pull in lyrics when you click on a song, which is a very nice touch that hearkens back to the days of buying a physical CD and reading along as you listen.
In addition to the recent explosion of music streaming services, there are even more startups launching that, instead of offering their own streaming service (an expensive proposition from both a technological and licensing perspective), they create tools that improve discovery, monetization, or the user experience. Most of them are terrible, or at best, they offer benefits to one stakeholder (say, artists and labels) but drawbacks to others (like streaming platforms). But by expanding the reach of artists and platforms alike, Bop has found an advantageous place in the market. And with the Verified Artist pages, it's also riding the tide of human curation which led to last week's acquisitions of Songza and TastemakerX by Google and Rdio respectively.
Bop makes money by taking a small commission from the streaming services for each new subscriber it refers, thus only making money when it also increases the industry's total revenue and hence the payouts to artists. This is better than some alternative startups look to take revenue from the industry without directly increasing consumer payouts. Across the industry, there are more stakeholders and fewer barriers for artists to enter the space, and yet with all these extra mouths to feed, the total music industry revenue has been cut in half over the past decade or so. Daredia says his service's fees won't affect artist payouts.
"This money comes out of the streaming services' marketing budgets," he says.
When asked what Bop plans to do with the $2 million, Daredia says they'll be hiring developers to build out a mobile app (right now it only has a mobile web presence). The site, which is still in Beta, could also be a bit more user-friendly. When you search by artist, only the top ten most played songs appear and there's no way to search by album. I also wonder how some artists who have elected to not be on Spotify (like Drag City's stable of musicians including Joanna Newsom) feel about their content being pulled in from unofficial uploads on YouTube and presented in a streaming music environment -- though that isn't exactly Bop's problem. If Newsom cares she should take it up with YouTube.
Although it's a little rough around the edges, Bop is a rare third-party music startup that, at least once it develops a bit more, helps solve a discovery problem for artists, users, and platforms alike.