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Streaming Music Grows Up

Stocks in this article: P

AUSTIN (TheStreet) -- Almost since its inception, the streaming music space has been rife with disagreements over technology, over man vs. machine approaches and over subscription vs. free models.

But in sign of a maturing sector, SXSW presentations and interviews this week -- with representatives of Beats MusicSpotify, Echo Nest and Pandora  (P) -- have shown those differences are melting away, forming a single set of problems and solutions that all the players are addressing.  In panel discussions on issues like the necessity of including a human component in the presentation of music to an audience, or the way streaming music is changing local music markets into one international bazaar, the big problems facing streaming music companies sounded remarkably the same from one company to the next.

In particular, the future of the sector will involve a greater sophistication of existing algorithms, a trend toward putting a human face on the music presentation process and sweeping data collection to better target individuals on an increasingly local level but on an increasingly international scale.

In a panel provocatively titled, "Man Vs. Machine: The Curation Dilemma," panelists seemed to agree both about the "dilemma" and its solution: humans need humans at the controls, helping guide and refine the music selection process for listeners in various ways, both in the deep background data collection and on the front end, as celebrities making recommendations for instance. Ian Rogers, CEO of Beats Music, referred to this as "curation by trusted sources."

When faced with the option of what to listen to, users can choose from any of millions or hundreds of millions of songs, depending on the service. Using algorithms is important to help them make sense of their choices. But if the recommendation is purely mechanistic, it's less helpful than if it comes from a specific person.

As Rogers put it in an separate interview, "As human beings we actually really value the cultural currency of music, who recommended you something -- it's impossible to separate the recommendation from who recommended it. Music is never without cultural context."

"I don't think an algorithm can ever give you that," he added.

While Beats Music is a subscription-only service, Rogers also wasn't ruling out a free, ad-driven component at some point in the future.

Beats launched as a spinoff from Dr. Dre's Beats Electronics only six weeks ago with much fanfare. The company builds its service partly on user data and song data it inherited from Mog, the music service purchased by Beats in 2012 that served as the foundation for Beats Music. But what Rogers and his company choose to emphasize -- both in the user interface and in its marketing -- is the human component, the celebrities and music personalities choosing the playlists and making recommendations.

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