As the music industry moves forward, revenue streams are expanding into territories we would never have imagined. The live show can now be streamed over the internet, music fans can listen to any song they want with streaming services like Spotify, lifestyle companies like Red Bull and Converse are getting into the record label business, and new publishing opportunities are popping up everyday.
One industry that just keeps growing is the gaming industry, and its presenting more and more opportunities for musicians. Rock Band and Guitar Hero really started the ball going for customizable game music, and since then, many platforms have been integrating in their own streaming or local music players. This definitely presents a great way forward for music. Integration with Spotify could mean more paying customers, and in-game purchases could evolve to include music packages. I really think this segment of the music industry is wide open for innovation.
Steam, which passed its tenth birthday last year, operates as both an online marketplace and a media hub for video game players worldwide, keeping their game libraries in a central location and storing game information and their purchases in the cloud. Similar to iTunes with music, Steam makes money the same way, taking a 30% cut of purchases. That structure keeps Steam’s marketplace a click away and Valve’s brand ever-present. While most video games are too complex to be played without having their files stored on a local device, Steam users are able to install the client on a new computer and bring their software with them, along with save game files and similar information. As of last October, Valve put the number of Steam accounts at over 65 million.
As it stands now, Steam Music simply allows its users to listen to tracks from their local digital libraries while simultaneously playing video games — as long as they are in “Big Picture Mode,” a user interface designed to mimic the living room-based functionality of the Xbox and PlayStation’s operating systems. But what if the service integrated a streaming service like Spotify? The result could be a boon for that streaming service as well as music rightsholders; recent revenue gains in Norway’s music industry have been directly attributable to streaming services’ pervasive scale in that country, accounting for 65.3% of recorded music revenues and driving industry-wide growth.
But there are strong indications that Spotify could eventually arrive on Steam. Martin Benjamins, one of two people behind the website SteamDB, a website — unaffiliated with Valve or Steam — dedicated solely to investigating the underlying code of Steam and its attendant programs, found something interesting inside Steam’s guts. “Valve has already done quite a bit of work on Spotify integration in the Steam client, and appear to be using… Spotify’s official API for [placing] Spotify functionality into third party applications.” If you need a translation: Steam is already testing integration with Spotify into Steam Music. Benjamins says that it appears as if Spotify Premium users would be able to utilize the feature.” It’s important to note that, while such digital sleuthing is a worthwhile exercise, unreleased or unactivated code doesn’t mean that a feature will see the light of day.
Valve declined to comment on upcoming or requested features, and Spotify did not respond to a request for comment at press time.
Steam Music’s beta page does state that “we see an opportunity to broaden Steam as an entertainment platform, which includes music alongside games and other forms of media.” The company has taken significant steps to this end recently, developing SteamOS which allows users to all but replace their gaming consoles with a home-built computer intended to be always connected to the living room television, as well as Steam Machines, a prefab console intended to serve the same purpose.
Neither Xbox or the Playstation have a Spotify app available on their platforms, each preferring to push its own products — Sony’s paid Music Unlimited and Microsoft’s Xbox Music., which, like Spotify, offers a free and paid tiers.
As far as their plans to sell music, the company says, alluringly, on its site that “Steam currently offers a number of game soundtracks for sale. Your feedback will help guide where we take things next.” It’s also emblematic of a company well-respected by its customers, largely on how closely it listens to user feedback.
A quick glance at the Steam users online at the time of this writing showed 6.5 million — about 500,000 more than currently pay for a Spotify subscription. If 10% of Steam’s 65 million-strong user base subscribed to Spotify as a result of a trial or bundle deal, it would raise Spotify’s paid subscriber base by over 100%. Playing with games may just mean serious business for music.”
What do you think? Do video games present a huge opportunity for the music industry?