There’s an old saw among established technology companies that says innovation happens elsewhere, that big ideas can come from small, unexpected places.
The best way to tap into that potential, according to this view, is to throw open the gates and let all developers build products on top of your existing, proprietary technology. Make it easy for developers, and good things are bound to happen.
That, at least, has been the ethos behind the steady stream of music-related application software interfaces, or APIs. Last month, two companies, Gracenote and MediaNet, quietly added their APIs into the mix.
The Gracenote API gives developers access to the company’s rich trove of metadata around 100 million tracks, as well as its music identification technology. MediaNet’s Startup Sandbox API lets developers play around with the company’s full suite of automated tools – ranging from Internet radio streaming and download sales to credit card processing and financial reporting.
The result? Anyone can now build a full-on digital music service without having to hire a lawyer or raise a dime of venture capital. All developers have to do is click to agree to the API’s legal terms, which typically don’t call for any money to be exchanged until the developers commercialize whatever they end up building.
This lowers the bar for developers to innovate around music, which is crucial if the industry is to find its way out of the doldrums.
“The rate of innovation has dried up in recent years,” said Mark Mulligan, principal analyst and founder of Midia, a digital strategy and consulting firm. “There’s a crisis of innovation around music. There needs to be more innovation to drive further competition.”
“What’s interesting now is that there is this whole ecosystem of APIs out there that makes it possible for you to stitch together your own music service,” said Paul Lamere, director of developer platform at The Echo Nest, whose own API offers artist data and a playlist generator, among other things. “You can get local concert listings from Songkick, lyrics from Lyricfind, photos from Getty Images, artist bios from Gracenote and personalized recommendations from The Echo Nest.”
What about all those lengthy negotiations with labels for licenses? Spotify, Rdio, Deezer and MediaNet have that covered, too. Developers can plug in any number of services into their software without having to meet with a single label executive.
That’s what Ian Gilman did last year when he and a friend created a mash-up of Rdio and Last.fm to create LetsFathom.com, a music discovery site that tries to digitally replicate the experience of digging through stacks of records and having a clerk walk through the connections between various albums. Another application, Setlist -- created last June by a tiny Canadian developer Mediumrare Inc. -- merges Rdio and Songkick, to match songs with upcoming local shows. And Stream That Song, which uses Gracenote’s API to identify songs and plays the tracks using Deezer, was created by a single developer in about four hours.
So what’s to prevent a flood of me-too music services from entering the market now that the barriers to entry are so low? Very little. A search on iTunes for “Internet radio” returned a list of 399 apps, many offering the similar features. Even the novel products struggle to find an audience. Gilman, the Seattle developer who created Fathom, acknowledged that his music discovery site has seen little traffic and remained itself undiscovered. Another challenge is that few if any of these new services are making money. Most are free to use and have no advertising or other means of generating revenue.
Does that mean the API approach is worthless? Hardly, said Frank Johnson, the CEO of MediaNet.
“You’re seeing a lot of promising niche services that are narrowly focused on genres or demographics,” Johnson said. “There’s also a lot more activity globally, so countries that haven’t participated in digital music before are starting to come in.”
In addition, companies also benefit from the ability to fine-tune their product based on the feedback of independent developers, said Ty Roberts, Gracenote’s chief technology officer.
“The more people who are playing with APIs, the more potential solutions you have for whatever problem it is you’re trying to tackle,” Roberts said. “To the extent that these guys come up with a $100 million business, they can come back and work with us.”