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Warner Music Group Tries to "Moneyball" the Music Game with Shazam

Big data business strategies continue to creep into the music industry. Earlier this month, The New York Times reported that Lyor Cohen's company 300 will help Twitter Music mine their vast amounts of data for useful information. Yesterday, Warner Music Group announced a partnership with popular name-that-tune application Shazam. Even though it’s a one-trick app, Shazam has quietly become one of the biggest players in the music industry. It is used over 10,000 times a minute around the world and drives $300 million in iTunes purchases, making them one of Apple's biggest affiliate partners. Warner hopes to tap Shazam’s song-detection data to identify trending, unsigned bands, which they in turn will recruit for a Shazam-branded label.

This move toward data-driven A&R is reminiscent of the Moneyball revolution that swept over baseball in the earl 2000s, when Oakland A’s general manager Billy Beane took up his famous crusade against baseball’s talent scouts. Whereas old school scouts recruited players based on intuition, Beane vouched for a numbers-driven system that found value in players where others didn’t. (He focused, for example, on a player’s on-base percentage instead of prettier stats like home runs and RBI’s.) By partnering with Shazam, Warner is looking to lock down its own inside line on undervalued talent using metrics nobody else is paying attention to. That being said, the old way of doing things won’t completely disappear. “While data and crowd-sourced analyses will never be a substitute for the expertise and instincts of our A&R professionals, we do believe the information we obtain for this new label will provide very useful signals that will bolster our ability to find the stars of tomorrow,” says Warner COO Rob in a recent press release for the collaboration. Looks like A&Rs should pick up a SXSW Interactive badge this year, too.

As this partnership plays out, it will be interesting to see how the "Shazam-branded" label takes shape. Warner will have access to a pool of listening data nobody else has, but how they will use it is still to be determined. How much stock will they put in a band that is trending data-wise, but that a veteran A&R might deem to be unmarketable? And is creating a label full of misfit bands who are popular by the numbers but share no cohesive "vibe" an efficient way to market bands? Using Shazam as an ingestion point for undervalued talent seems like a great idea, but building a label is just as much an exercise in creative branding than metrics savvy. Last year's data can't wholly predict next year's tastes.

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Warner Music Group Tries to "Moneyball" the Music Game with Shazam