Thoughts From 51 Hours In SF: @iTunes, @Google and Angry Little Clouds
Thoughts From 51 Hours In SF: @iTunes, @Google and Angry Little Clouds

SAN FRANCISCO -- Few areas of the music app space generate as much attention as the new breed of location-aware music apps. But few feel the current stable of location-based music apps have yet fully delivered on the opportunity for one big reason: no one really knows what the opportunity is yet.

That's in the process of changing. During a freeform roundtable on location-based apps here at SFMusicTech Summit, several developers said that they are collecting a host of user data around their apps that are helping to inform the next generation of services that one day may fully deliver on the promise of the location app potential.

For instance, right now apps like Soundtracking may not be making the music industry a lot of money, but developers of the app are collecting highly valuable data on how differently the app is used in different cities. In Los Angeles, the most track tagging activity takes place in the car, as users are stuck in traffic. In New York, users are tagging songs later at night, mostly while drunk. A representative from Shazam said the company is monitoring the location of every track ever tagged on the song ID service (on average, 3 million worldwide a day).

All the scare tactics around Apples "locationgate" aside, this knowledge could have a huge impact on how the next generation of music apps are built, and monetized. Perhaps there's a way for Soundtracking to work with LA-based radio stations with Soundtracking given all this activity taking place in the car. In New York maybe there are partnerships with bars. Expect Shazam to incorporate some sort of advertising messaging to users based on what they tag, when, and where. (Already, Shazam claims to drive 300,000 track sales a day from users who select the "buy" button after identifying a song.)

This data won't only help the development of new apps, but can inform how partners like managers, artists and labels can better capitalize on them. According to Jonathan Carroll at Gowalla, simply offing fans a 10% discount off at the merch table for checking into a concert isn't enough. But what is? These are the kinds of things developers are trying to find out.

The developers in the discussion say that too often the music industry, particularly the labels, are too quick to look for an ROI rather than watching to see how fans are using the app. The money may come later.

Soundtracking's Steve Jang calls it a "social graph for music." It's still being built. Its value is as yet unknown. But the developers here anyway seem very excited about the information they're collecting, even if they don't know what to do with it yet.