A Music Ally Primer Music and in 2017 1 Introduction

When agreed to pay $2bn for for it; and which devices will emerge as the virtual reality startup VR in March most popular way to get that content to 2014, it was the start of a new wave of the audience of music fans. investment in a technology that stretched back decades: virtual reality. Not everyone is a VR evangelist. There are plenty of sceptics the industry Since then, we have seen Samsung, questioning whether this technology will , Sony and HTC launch their own ever become mainstream, pointing to VR headsets, while Facebook and lower-than-expected sales of the current YouTube have upped their commitment to wave of headsets, and older cycles of 360-degree and VR content; prominent hype and disappointment with VR. firms in the TV, filmmaking and gaming worlds have entered the market; and We hope this primer will help you form China’s big tech companies have made your own opinions. Music Ally has put their first VR bets. together some data on the current state of the VR market; explored the main And music? The music industry is headsets that are on sale; profiled some of increasingly excited about the potential of the music-focused VR startups; and virtual reality too. Since the start of 2016, examined some of the VR music when Music Ally published our first VR experiences that have launched since the primer, we have seen lots of activity from beginning of 2016. We have also outlined labels, artists and startups. Many of them our thoughts on how music companies think VR has considerable potential, even and artists can experiment in this new if they aren’t sure quite what that will look medium, finding partnerships and learning like; whether people will be willing to pay lessons without wasting their money.

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Early sales of the current generation Market Data and of VR headsets have been slower Forecasts than expected, but don’t despair yet

Are current sales of VR headsets around VR before those headsets went on disappointing, or were the analyst sale in 2016 has turned to fretfulness, and expectations for those sales overblown? in some cases disillusionment. What’s Music Ally’s view: a little of both. What’s really going on in the market? Here are undeniable is that some of the hype some stats showing its current status.

2 Headset sales so far said in late February that it had sold 915k PlayStation VRs since that device’s launch In February 2017, research firm SuperData in October 2016. published its estimates for VR headset SuperData appears to have not counted sales in 2016, claiming that 6.3m were viewers in its research, shipped that year. It also suggested that though. Google announced in January Samsung’s Gear VR headset accounted 2016 that 5m Cardboard viewers had for 71.4% of those shipments: 4.5m units. shipped, then in February 2017 updated It claimed that Sony had shipped 0.8m that figure to 10m, which suggests that PlayStation VR headsets; with 0.4m HTC they may have at least matched the Gear Vive shipments, nearly 0.3m for Google’s VR’s shipments in 2016, taking the total Daydream View, and more than 0.2m for market closer to 11m units that year. Facebook’s . These figures are certainly below the The few official stats we have appear to expectations of some analysts. Juniper back up SuperData’s analysis. In January Research suggested in November 2016 2017, Samsung announced that it had that 16.8m mobile VR headsets – those shipped more than 5m Gear VRs since its designed to be used with , original launch in 2015. Meanwhile, Sony like the Gear VR, Daydream View and

3 Google Cardboard – would ship in 2016 alone.

Others had been more restrained with their predictions. In April 2016, IDC claimed that 9.6m VR headsets would ship in 2016, including 2m shipments for “tethered” headsets like the combine this with robust shipments of Oculus Rift, HTC Vive and PlayStation VR. screenless viewers from Samsung and IDC also left Google Cardboard out of its other vendors launching later this year, you predictions for the market. start to see the beginning of a reasonable installed base for content creators to Meanwhile, at the end of 2016 Canalys target,” he said. predicted 2m VR headset shipments for the year, but it left both the Gear VR and From the gloom camp, in December 2016, Cardboard out of its numbers. Edison Research published a report warning that the market had seen “HTC’s Analyst hopes and gloom Vive, Oculus Rift and Samsung’s Gear VR all undershoot expectations with no When looking at the VR space in 2016, immediate improvement on the horizon”. analysts ranged from ‘it’s still early days’ Analyst Richard Windsor was blunt. “VR is caution to gloom. “The VR market has clearly not ready for the prime time and barely begun, and Canalys believes it will there remains a lot of work to do before take several years to ramp up,” said volumes will really take off,” he said. “We analyst Jason Low. “There are do not see this happening in 2017 encouraging signs of consumer adoption meaning that the outlook for next year and positive customer satisfaction, remains pretty grim.” however, especially among gamers.”

IDC’s Tom Mainelli offered a similar view in Plans to buy... or not April 2016, when talking about his One challenge for the VR industry is company’s prediction for 2m shipments of persuading people that they should buy a tethered VR headsets. “When you

4 headset in the first place. In October 2016, research firm Strategy Analytics surveyed Brits on how likely they were to do that. Just 3% said they would.

Another firm, Newzoo, interviewed people across 12 analysed figures published by digital countries in North America and Europe to games store Steam, which tracks usage of find out their buying intentions. games released for the HTC Vive and Oculus Rift. “We see that 11% of the online population (aged 10-65) intend to buy a VR product in “The number of new HTC Vive owners on the next six months,” it reported. Steam grew only 0.3 percent in July and “Interestingly, 7% of this group, or 4.4 was flat in August,” claimed the report. million people, are non-gamers. This proves the technology’s appeal and reach “The Oculus Rift headset from the is already extending beyond gaming.” Facebook subsidiary saw similar stagnation of 0.3 percent in July and 0.1 More encouragingly, a US study published percent in August. At this point, only 0.18 by Nielsen in October 2016 based on a percent of Steam users own the Vive and survey of 8,000 Americans found that only 0.10 percent own the Rift.” around 24% of 18-54 year-olds were ‘more likely’ to buy a VR headset in the next year. This was particularly notable because those two months were the first without The key will be reaching beyond the early supply constraints for either device. adopters of this generation of VR. In September 2016, tech site VentureBeat

5 Funding and investment According to investment site Index by TNW, in the first quarter of 2017 alone There may be debate about how popular there has been nearly $80m of institutional VR headsets are, but there is no doubt funding in VR startups – a figure that does about the investment dollars flowing into not include seed rounds where the total this industry. In January 2017, research was undisclosed. Facebook, Samsung and firm Greenlight Insights claimed that there HTC have all announced funds for was $1.8bn of investment in VR and AR promising VR startups, meanwhile. () combined in 2016, for All this funding comes off the hopes that example. there will be a thriving market for VR The number of funding deals increasing by content in the years ahead. Research firm 30%, and the average deal size by 58%. IHS Markit predicts that consumer More than 85% of the deals were seed or spending on VR entertainment will grow Series A rounds, representing the relative more than tenfold from $310m in 2016 to youth of the market. Although the caveat $3.3bn by 2020, at which point it expects here is that $793.5m of that total was a there to be 81 million people who own a single round of funding for one AR VR headset. However, the company told company, , in February 2016. Music Ally that it expects 86% of that $3.3bn of spending to be on games,

6 leaving only around $462m for other types of VR content, including music.

Separately, Deloitte predicted that VR would enjoy its “first billion dollar year” in 2016, but with $700m from hardware sales, leaving $300m from content – a near-match for IHS Markit’s prediction. Deloitte, too, expected the majority of The video theme also came through in content revenues to come from games. Samsung’s announcement in January 2017 that Gear VR owners had watched SuperData has been notably bullish with more than 10m hours of 360-degree video its VR content predictions. It claims that using their devices: although with 5m VR consumer and services will headsets shipped so far, that’s an average grow from $300m in 2016 to $19.9bn in of just two hours per user. 2020: overtaking revenues from VR hardware for the first time that year. There are some warning signs over the propensity to pay for VR experiences. In Early usage data November 2016, Juniper Research claimed that more than 95% of apps for It is still very early days in terms of mobile VR headsets are downloaded for understanding the activity of VR users, but free. That’s as much a reflection of the a few data points have crept out. app market’s dynamics as on VR, but the company warned that In February 2017, Google said that people low-quality free apps could be damaging. using Daydream-ready smartphones and headsets were watching about 40 minutes Many consumers are likely to try the of content a week, but that “well over” platform because the hardware is relatively 50% of that activity was YouTube videos. cheap, and then turn away because of Unsurprising, given the small number of low-quality free content,” said analyst Daydream apps so far, and the fact that James Moar. YouTube has a growing catalogue of 360-degree and VR videos.

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Five hardware platforms are Hardware Focus generating most of the VR activity from developers in 2017

2016 was a big year for new VR hardware, Google’s Daydream View and the latest thanks to the release of several ‘tethered’ iteration of Samsung’s Gear VR. These are headsets – Oculus Rift, HTC Vive and not just hardware plays though: all have PlayStation VR – as well as the debut of their own apps and content ecosystems, new models in the mobile-VR sector: and increasingly content investment too.

8 Oculus Rift

Oculus VR kicked off the current wave of codenamed ‘Santa Cruz’ with an VR excitement when it raised $2.5m on embedded computing module, ensuring it crowdfunding website Kickstarter in 2012. is neither tied to a PC nor requires a One $2bn acquisition and two smartphone to be inserted. development kits later, its first commercial model went on sale in 2016. Facebook and Oculus have invested in content, with claiming Priced at just under $600, the Rift required that it has made $250m available so far, a powerful PC at launch, with ‘Oculus and the same amount to follow. Oculus VR Ready’ computers starting at $1,499. also has its Story Studios subsidiary Since then, the company has reworked its working on animated films, winning an technology to work with less powerful Emmy award in 2016 for the film ‘Henry’. PCs, although it doesn’t support Macs. Recent changes at Oculus VR include Facebook and Oculus VR have not said splitting the company into two groups: one how many Rifts have been sold so far, focused on PC and the other on mobile although research firms claim it’s in the low VR. Facebook also appointed former hundreds of thousands. 2016 was a tough Google and executive Hugo Barra year for Oculus VR in other ways too: a as its VP of Virtual Reality in January, to lawsuit over trade secrets from games firm lead its efforts in VR. ZeniMax Media ended with a $500m judgement in that company’s favour. Oculus also recently knocked $100 off the price of a Rift, and also off its separate Oculus VR is not just about the tethered controllers, meaning that the Rift headset. It also supplies the combined cost is now less than $600. technology used for Samsung’s Gear VR, Facebook has also been working hard on including its app store. Meanwhile, developing social features – focusing Facebook CEO has initially on the Gear VR – and the ReactVR shown off a standalone headset web framework for virtual reality.

9 HTC Vive

Taiwanese consumer electronics company Venture Capital Alliance network of tech HTC is best known in the west for its firms and VCs. smartphones, but the company got into the VR market in early 2016 with its Vive Viveport is also the brand for HTC’s own headset. It was the result of a partnership app store for VR experiences. While Steam with Valve, the games firm behind the is the main portal for Vive games, Viveport Steam digital store. has a focus on art, creativity tools, design, education, fashion, music, sports, travel Vive was the most expensive VR headset and video among other categories. when it launched at $799. HTC has not released official sales figures but reports in HTC is also one of the companies moving August suggested sales of 140k units, fastest to test the idea of ‘VR Arcades’ – while research firm SuperData claims that amusement arcades focusing on VR grew to 400k by the end of 2016. hardware and experiences.

Like Facebook and Oculus VR, HTC has It has created a Viveport Arcade sub-brand been investing in content and its to open these venues, with the first being development community. In February Viveland in , which has more than 2017, its inaugural Viveport Developer 120 titles available for visitors to play. Awards (VDAs) gave away $500k worth of At launch, HTC executive Rikard Steiber cash and prizes to talented developers. promised that “Viveport Arcade will HTC has also invested in startups – $5m in represent a more than $100 million market VR games firm Steel Wool Studios in opportunity for VR developers in the next August 2016 for example – while its Vive X two years”. accelerator program launched with a first cohort of 33 startups in July 2016. It’s backed by a $100m investment fund from HTC, which is also involved in the VR

10 PlayStation VR

Sony Computer Entertainment’s venture rivals, the Oculus Rift and HTC Vive, into virtual reality began as Project combined. Morpheus: a prototype VR headset designed to work with its PlayStation 4 Games and apps are available for the console. In September 2015, as it moved PlayStation VR through Sony’s existing closer to launch, Sony rebranded it as PlayStation Store ecosystem. PlayStation VR. Unsurprisingly, the emphasis has been on games so far, with Resident Evil 7 winning The theory was to target the (then) 36 particular praise. Some music games have million PS4 owners – this figure reached also been released for the headset: rhythm 50 million by the end of 2016 – with a game Infinite has won critical acclaim, headset that would run games and apps while there is also a PS VR game based on available for the console. Japanese avatar-singer Hatsune Miku.

PlayStation VR launched in October 2016 PlayStation VR is also benefitting from the for $399 – a lower price than rivals, relationship between Sony Computer especially when you consider that it was Entertainment and Sony Music, with targeting people who already owned the experiences available for artists including necessary games console. Kygo and Joshua Bell.

Of the ‘tethered’ VR headsets, PlayStation VR has been the most popular with consumers. Sony said in February that it had sold more than 915k units of the device since launch, and was on course to beat its target of 1m by April 2017. Analysts have suggested that the PlayStation VR has outsold its two closest

11 Samsung Gear VR

While Gear VR is Samsung’s single VR more than 50 million people, so the Gear headset brand, there have been several VR has a large customer base to draw on. models, as the company has improved the specs and features each time. The device The Gear VR is also becoming an is a partnership with Oculus VR, which important testbed for Facebook and provides the tech and app store. Oculus VR’s experiments in social VR. In March 2017, they announced the ability to The Gear VR has always worked solely watch 360-degree videos with friends with Samsung’s own smartphones. It has using the headset, as well as an initiative proved to be the most popular called Oculus Events. (non-Cardboard) VR headset in the market, reaching the milestone of 5m sales by That will act as a guide to live, streamable January 2017, having originally launched in events available through the Gear VR December 2014 for developers. “from multiplayer games and tournaments to tech talks and trivia”. As and when the The device has benefitted from its status necessary apps launch, live music as a smartphone accessory, with some concerts could be part of that too. telcos choosing to bundle it in for free when people buy or upgrade to a new In February 2017, Samsung showed off Galaxy smartphone. Even standalone, its the latest version of the Gear VR, adding a $79.99 price makes it one of the most wireless controller to better compete with affordable ways to buy a VR headset. Google’s Daydream View. The following month, the company unveiled a content Samsung has been the biggest service called Samsung VR, and an app of smartphone maker for some time now, the same name. At launch, it included shipping 77.5m handsets in the fourth more than 8,000 videos and 2,000 quarter of 2016 alone according to IDC. “premium experiences” to show off the Just as the PlayStation VR benefits from Gear VR’s capabilities. its association with a console owned by

12 Google Daydream

Google Daydream is actually Google’s Cardboard in favour of a comfortable second-generation virtual-reality platform. fabric-focused design. Undercutting The first was Google Cardboard, which Samsung’s Gear VR by $20, it went on launched in 2014 as a way for smartphone sale in November. Alongside it came a new owners to fold together Cardboard YouTube VR app, which rounded up 360 headsets that used their phones as and VR videos on Google’s service, as well processor and screen combined. as showing regular videos on a virtual movie screen within the app. By May 2015, more than 1m Cardboard headsets had shipped, rising to 5m by In January, Google opened up Daydream January 2016, and 10m by March 2017 – to a wider range of developers. However, at which point, Cardboard-compatible in its early days, the platform has been apps had been downloaded more than heavily focused on YouTube. In February 160m times, with 30 of those apps 2017, Google said that “people using reaching more than 1m downloads. Daydream-ready smartphones and headsets are watching about 40 minutes a In May 2016, Google announced the week, with more than 100 apps now successor to Cardboard: Daydream VR. It available for the platform. But “well over” was VR features in the upcoming Android 50% of content consumption on N software, with buy-in at launch of the Daydream is YouTube videos. likes of HBO, Netflix, , the New York Times, CNN, the NBA and Lionsgate. Google has secured support from the likes of Sky and the NFL, which launched a The first smartphones to include dedicated VR app for Daydream in Daydream support were Google’s own November 2016. On the music front, it’s handsets, and they were unveiled in likely to be an early port of call for many October 2016 alongside the first Daydream developers – as well as being a useful headset. Also a Google product, it was the device for YouTube 360 videos. $79 Daydream View, which eschewed

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Music VR Startups From 360-degree live footage to interactive experiences, there are a number of music-focused VR firms

Investment site AngelList has a number of startups with music as either of more than 1,300 virtual reality startups, their focus, or one of their core areas. We adding 58 new firms in February 2017 have profiled eight of the most interesting alone. Those figures cover all aspects of ones, as well as mini-profiles of other VR, but there is a small but growing startups worth watching in this space.

14 Inception www.inceptionvr.com

Israeli startup Inception is exploring a range of VR and 360-degree content, including music, but also other arts, tourism and fitness.

The company’s app is available for iPhone and Android, as well as Samsung’s Gear VR headset, Oculus Rift and HTC Vive, with PlayStation VR support on the way.

The free app provides access to various Keshet, which devised the original version experiences, but music is one of its key of drama Homeland. verticals. They include interviews with For now, Inception’s app and content are British artists Ed Harcourt and Mystery free, although the company is keen to Jets, giving fans a tour of their studios work with brands, who could provide a while talking about their music. stable revenue stream to help fund its Inception also hosts a 360-degree music original content. video for electropop artist Kyla La Grange, Inception’s launch of VR city guides in and has worked with dance brand Boiler January 2017 also showed how the Room on VR formats too. company sees music sitting alongside Inception is drawing on knowledge from other kinds of VR content – and thus the music, TV and tech industries alike. perhaps bringing the featured artists to an Music-focused digital video firm audience beyond their core fanbases. LoveLive’s CEO Richard Cohen is on Inception’s board of direcors, while its head of content Ran Telem previously worked at Israeli TV production firm

15 Mbryonic www.mbryonic.com

UK-based Mbryonic has set itself up as a VR content creator for clients in the marketing, entertainment and arts worlds, and while music is one of its main areas, it also has its eyes focused on brands.

“We feel that there is a bridge missing between brand strategy and VR makers. listen to and watch their music, as well as You rarely get purpose and form,” claims interacting with instruments. its website. “We understand the medium, what works and what doesn’t.” It has also created a product for turning old music videos into 360-degree VR Mbryonic has released a ‘Showcase’ app experiences – essentially playing a 2D about its technology for Google Cardboard video in a 3D environment that reacts to a headsets, but when founder Tom Szirtes music. Viewers can trigger DJ-like effects pitched the company at the NY:LON and interact with the environment. Connect conference in January, he talked more about the music potential for VR. The company isn’t afraid of ambitious ideas either. “Why go to the expense of “It allows you to immerse yourself in the staging a gig… when you could stage an world of the artist… and an opportunity to entirely virtual gig. Imagine going to see a create new revenue streams that rock band on top of a mountain with audiences will be perhaps willing to pay fire-breathing dragons overhead… or a for,” said Szirtes. dance club where the walls are pulsating,” He explained that Mbryonic has created a said Szirtes. “These are the kinds of toolset to help artists create their own VR experiences that VR can offer.” worlds, for fans to wander around and

16 MelodyVR www.melodyvr.com

British startup MelodyVR has been building up a large catalogue of live performances shot for VR, ahead of the commercial launch of its app in 2017.

The app launched in closed beta at the end of 2016 for a small group of testers using Samsung’s Gear VR headset. It Music Group. It followed that with a offers a selection of performances, with deal in March viewers able to choose from several 2017. MelodyVR is looking beyond archive positions in the venue, and then look performances too: for example, the ability around them in 360 degrees. to stream gigs live in VR. At launch, MelodyVR plans to use an “When physical tickets sell out, we can iTunes-style a la carte pricing model: for switch to a digital ticket with limitless example, charging 99p to buy one capacity: so no more four-minute sellouts performance, or £10 to buy the entire for Adele’s shows at Wembley,” COO concert – the exact pricing has yet to be Steven Hancock said at the FastForward finalised. It’s also possible that MelodyVR conference in February 2017. “If a million will try a different model, charging for time people want to attend that show in spent within the app so that its users can real-time, as it’s happening”. explore the full catalogue. MelodyVR has been a public company MelodyVR has been one of the most active since before its launch. Its parent company startups when it comes to working with EVR Holdings is listed on the UK’s AIM labels, managers and venues. It has filmed Exchange, and in November 2016, the performances from more than 500 artists, company raised £3.4m through a new and in December signed its first placing of shares. major-label licensing deal with Warner

17 NextVR www.nextvr.com

Like a number of other VR content startups, NextVR’s focus is on live events in both music and sport. On the latter count, its partners have included broadcasters Fox Sports and NBC Sports, as well as HBO / Golden Boy.

NextVR was also one of the first VR firms that Music Ally found working with November 2015, with the Madison Square musicians. In December 2014, it filmed a Garden Company joining Comcast Coldplay gig and made it available through Ventures and Time Warner Investments as Samsung’s Gear VR headset – one of the a backer. In August 2016, it followed that first pieces of music content available for with an $80m round involving several that device. Chinese investors as well as Japanese firm SoftBank. In May 2016, NextVR announced a high-profile partnership with Live Nation, In recent months, the headlines around with plans to stream hundreds of music NextVR have been more about its sports concerts in VR. In September 2016, the offering – partnerships with US sporting pair brought bank Citi into the deal, as part bodies the NFL and NBA were strong of its existing Backstage with Citi initiative. signs of progress in an industry that might The plans were to make the music content be more lucrative in the long-term. But we – by then pared down to an initial run of 10 remain keen to see how the Live Nation concerts – available through a Live Nation partnership evolves. channel within NextVR’s app.

NextVR is also one of the biggest-funded startups in the VR ecosystem, having raised a $30.5m Series A round in

18 TheWaveVR www.thewavevr.com

As one of the first dedicated music/VR startups to get funding and talk about its plans, TheWaveVR has often been bracketed alongside MelodyVR. However, while the latter’s launch catalogue is focused on live performances, TheWaveVR’s plans are more about reinventing videos and stage visuals for audiences of headset-wearers. and mobile social-music app firm Zya. He “TheWave creates a VR venue where explained the theory behind TheWaveVR. artists can perform live music by simply “Our platform is a social platform really. importing their tracks, customising the Most of my team’s background is the visuals of the venue, and sharing virtual video game industry, and what inspires us shows,” explained the company in August is interaction,” he said. 2016. “Fans can attend via most major VR head mounted displays, interact with “The performer is mixing their music live performers, socialise with friends, dance, on-stage, in a set of 3D interfaces. Then paint and more.” the audience is interacting with one another, dancing – shaking their virtual In August 2016, TheWaveVR raised $2.5m booty, and painting with light... The venue of seed funding from investors including is a giant, 3D music visualiser, responding KPCB Edge, the seed-focused offshoot to the amplitude, frequency and other from big VC firm Kleiner Perkins. parameters to create different shapes, That month, Music Ally interviewed CEO colours and light.” Adam Arrigo, whose background included roles at Rock Band developer

19 VRTIFY www.vrtify.com

US startup VRTIFY bills itself as “the world’s first virtual and music service provider”, setting its sights squarely on the music industry. However, that also includes integrations with some of the industry’s biggest existing service providers: Spotify, Deezer, Pandora and SoundCloud. It is early days, and for now, this is as VRTIFY’s current product is a free app, much an experiment about how a VR app available on Android and iOS. It came out can serve as a visualiser add-on for as a public beta in early 2017, with plans existing streaming services – a feature that to make it available for the full range of VR arguably those services will add to their headsets – Oculus Rift, HTC Vive and own offerings if and when VR goes PlayStation VR included. mainstream.

The app gets people to sign in to their Still, VRTIFY is keen to explore how this streaming account of choice, then listen to technology can develop. “Immersive music “in unique filmed and virtual technologies aren't mainstream, but we all environments that complement their see how quickly they're evolving,” its chief mood, from a relaxing beach cabana to a marketing officer Marcus Behrendt told the thrilling flaming volcano”. BBC in January. “It will soon represent a very important income for the music However, VRTIFY will also make exclusive industry because it is changing how fans live performances available that it’s shot are consuming music.” for VR, with Coldplay and Die Antwoord featured when the app launched.

20 VRLIVE www.vrlive.com

US company VRLIVE describes itself as a “virtual reality production and entertainment network”, making content for Oculus Rift, HTC Vive, Samsung Gear VR and Google Cardboard.

Like other startups profiled in this primer, it has explored sports (a VR experience for the Indianapolis 500 race) and brands (a partnership with Hyundai around the Super Avenged Sevenfold, DNCE and Shawn Bowl) but music is its biggest content Mendes. category so far. VRLIVE has also been one of the most VRLIVE has produced VR content based active VR startups around partnerships on performances by U2, Coldplay, Demi with music festivals. It has shot and Lovato, Steve Aoki and 5 Seconds of distributed VR footage for the Electronic Summer, as well as working with Daisy Carnival and Austin’s Levitation iHeartRadio around its annual awards. festival, with the latter selling $20 virtual tickets for the event – selling 1,000 in four The company really came to the music days after announcing the plans. industry’s attention, though, in October 2016, when it was the technology partner VRLIVE has also worked with Samsung for Universal Music Group’s launch of an and Red Bull around music events. app called VRTGO.

Also profiled later in this primer, VRTGO has been offering a range of 360 videos and experiences for UMG artists, including

21 Within www.with.in

Within started life as a company called VRSE, founded by interactive filmmaker Chris Milk. In fact, there were two companies: one was an app and distribution platform for VR content, and the other was a production studio.

Milk’s background in innovative music Rdio. However, Within’s focus is wider videos carried through into VRSE. For than music: it has worked on wildlife and example, it worked with Apple on a news documentaries; a VR experience for 360-degree video for U2 in October 2015, TV drama Mr Robot; and then a similar project for Muse. Sundance-garlanded short film ‘Notes on Blindness’. Andrew Huang from VRSE.works, the production firm, also directed the Milk is a persuasive advocate for the 360-degree video for Björk’s ‘Stonemilker’, potential of VR. “I believe that virtual reality which was released as an app. marks an inflection point,” he wrote in June 2016. “That this is much more than In June 2016, VRSE rebranded as Within the latest gizmo or fad, but rather the alongside a $12.7m funding round, with genesis of a fundamentally new Live Nation and WME among an investor technology platform – one that will change group that also included Vice Media, how we communicate, connect, and tell Legendary Pictures, 21st Century Fox, stories. VR is just its first manifestation.” Andreessen Horowitz and Raine Ventures.

Besides Milk’s background, Within has other links with the music industry. Its chief operating officer Drew Larner had previously been CEO of streaming service

22 Other Music VR Startups to Watch

Endless Riff However, Kudu’s focus across all of those www.endlessriff.com may be more about advertising: it claims to have developed “the world’s first VR New York-based startup Endless Riff is an ad-server that will work across various early-stage company, but its profile on devices and platforms, with the targeting investment site AngelList hints at its and analytics that brands would expect. ambitions. The company is planning to make money “Endless Riff is a virtual music festival. We from subscriptions, white-label use a networked social virtual reality partnerships, revenue shares and platform to allow music fans to distribution. Another music link comes co-consume, socially bond, and through co-founder Hernan Portugal, who communicate more often around live, is also CEO of GoMusic, a startup recorded, and self-captured music distributing HD videos of concerts. content,” it explains. NOYS “Whether it be virtualized existing, former, www.noysvr.com or new virtual “venues”, live music can be curated and experienced with friends like German startup NOYS flew onto Music never before.” Count us intrigued. Ally’s radar in December 2016, when it was the jury winner at the Music WorX Day Kudu VR conference’s startups pitching session. www.kuduvr.us NOYS presents its technology as an artist San Francisco-based Kudu VR is another and fan-friendly alternative to playlists, company that includes music among a that gets listeners more immersed in wider list of sectors – in this case including music. Its product will be a sports, real-estate, tourism and medical. through which fans can watch artists performing live, using their VR headsets.

23 The company’s plan was to launch the app Angeles-based startup Red Pill VR, which in a preview version for the Samsung Gear hints at its ambitions beyond simply VR headset. During demos, it has also shooting concerts for 360-degree viewing. shown how product placement and advertising can fit in to its virtual gigs, “Red Pill VR is bringing together top hinting at its potential business model. engineers, producers and artists to build THE platform for the creation and Parallel distribution of music experiences in VR,” www.parallel-experience.com claims its site.

Denver-based Parallel is exploring the area “With over 2 years of R&D in the fields of of live-streaming concerts in VR, among signal processing, computer graphics and other sectors. “The days of ‘sold out’ machine learning, we have developed notices, sitting in the nosebleed seats or state of the art technologies to enable having to miss an event for any reason are mind-bending, fully interactive, social, over,” suggests its pitch on investment site photorealistic music-driven experiences AngelList. “For the first time, artists can that will change the way we understand reach unlimited audiences and promoters and interact with this universal language.” can sell tickets to an unlimited capacity Samo crowd.” www.samovr.com A similar line of argument has been made by MelodyVR, although it’s still early days We first encountered Samo in October in terms of gauging how much music fans 2016, when Wired profiled the US startup will be willing to pay for these virtual as part of a bigger feature about virtual tickets. Parallel says its website will launch reality and the music industry. It described in early 2017, with a focus stretching “from Samo as “a pipeline for all things VR concerts to classrooms”. music” – virtual reality’s equivalent of a digital distributor for music, taking in VR Red Pill VR and 360-degree content and distributing it www.redpillvr.com to platforms like Jaunt, Oculus, Steam, Facebook and YouTube. “Interactive, presence VR is the future of VR,” claims the website for Los

24 Since then, the company appears to have The company says it plans to make money honed its pitch into something different. through a mixture of freemium, “Samo collaborates with music artists to subscription and advertising. It’s also create ground breaking experiences for selling a $39.95 ‘Premium Viewer’ headset brands who are daring enough to that’s compatible with the Google innovate,” explains its website. Cardboard system.

Examples of its work so far include ‘Drugs Splash (VR Experience) for emerging artist Eden, www.splashapp.co which has been watched more than 570k times on YouTube. The involvement of Splash isn’t a music VR startup as such, music manager Scooter Braun’s SB but it’s an app that could have implications Projects in the video hints at the potential for the music industry if it catches on with for more artist partnerships ahead. fans. This is one of the first apps focusing on user-generated VR content. Spaceout.VR www.spaceoutvr.com Initially available for iPhone, it invites people to shoot their own 360-degree New York-based startup Spaceout.VR’s videos and then share them with friends, app includes music, but also gaming and both within the Splash app itself, and social elements. “Spaceout.VR integrates through other social apps and networks. entertainment, gaming and The videos (or, inevitably, “splashes”) can communications into one awesome VR also be viewed with a Cardboard headset app,” as its listing on the iOS and Android for the full wraparound experience. app stores puts it. Splash won top prize in the VR category at That means more of a community feel, a startups contest during SXSW 2016, and with users encouraged to log in to their has continued to develop since, with own personal space, then play games and Seedcamp chipping in to its $2.5m seed socialise with friends. The music comes funding round. from a SoundCloud integration – one of the first such uses of a streaming API that we’ve seen with virtual reality.

25 Teleporter It has worked with music-industry clients www.teleporter.tv including Universal Music, XL Recordings and Ultra Music, as well as Rolling Stone. Turkish startup Teleporter is another firm aiming to bring live experiences to VR, and “We're bringing live music to the Virtual focusing on music concerts and sporting Reality space, integrating the most realistic events in particular. elements of light, 3D sound, 360 video capture together within VR environments It offers the technology to help partners to give remote spectators a realistic sense film and stream events live, as well as of what it's like to participate in large developing white-label mobile apps to concerts and public events,” explains deliver the streams to viewers. Those apps co-founder Mahtab Ghamsari’s profile on are designed to work with mobile VR LinkedIn. headsets, while Teleporter’s platform will also include social features: “See your friends as 3D avatars with voice communication and body tracking features,” as its website explains.

Teleporter was a finalist in the VR category in SXSW 2017’s Accelerator Pitch Event, bringing its technology to a wider audience ahead of its commercial launch.

VRSUS www.vrsus.co.uk

London startup VRSUS is a VR production agency, but music is one of its key verticals alongside fashion. The company handles 360-degree audio and video production, as well as full VR and mobile app development.

26 5

What have artists and labels been Case Studies doing with VR? Here are some examples from 2016 and 2017

There is a growing catalogue of musical but our aim is to provide a snapshot of VR experiences. Here, we’ve gathered (in activity in the industry. See our last primer reverse-chronological order) some of the – downloadable here – for previous case most prominent examples from the last 15 studies: from Squarepusher and Björk to months: the quality and ambition varies, The Who and Megadeth.

27 Mar Mar 2017 2017

The Chainsmokers Machinedrum

The Chainsmokers are another artist that Ninja Tune has been one of the most has benefited from Sony Music’s desire enthusiastic labels in terms of to explore VR beyond just 360-degree experimenting with VR. A project for artist performance videos. Machinedrum in March 2017 was its latest exploration of the technology’s In March 2017 at SXSW, Sony showed off potential for music. an experience for the PlayStation VR headset based on the dance duo’s song Created around the ‘Ocean of Thought’ ‘Paris’, with fans able to interact with the track from Machinedrum’s last album, it’s mix of the song itself. a collaboration with Finnish designer Antti Jäderholm, using the WebVR standard to This is part of a bigger initiative called ensure it’s usable from desktop and ‘Lost In Music’ though, which had its mobile browsers as well as VR headsets. coming-out party in Los Angeles in January 2017. Sony described it as “part Pitched as “a magic carpet ride through immersive theatre, part music festival, the unconscious mind” it involves part crazy warehouse rave”, with visitors wandering across an alien landscape, donning PS VR headsets for a with real-time graphics (which is why it’s Chainsmokers-soundtracked journey not available as a 360-degree video on through the seasons. platforms like YouTube).

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28 Mar Mar 2017 2017

Rock Band VR SoundStage

Rock Band VR is the latest iteration of SoundStage is another example of a VR developer Harmonix’s long-running app focused on music creation: “whether franchise of music games. It was you’re a professional DJ creating a new released on 23 March 2017 as an sound, or a hobbyist who wants to rock exclusive for the Oculus Rift headset. out on virtual drums,” as its listing on digital store Steam puts it. While the game can use a Rock Band 4 guitar controller, it has also been SoundStage was originally released for designed to use the Oculus Touch motion the HTC Vive headset in 2016 as an “early controller. It shipped with 60 songs from access” application, before its full launch the usual range of new and heritage in March 2017. It capitalised on the Vive’s artists, including Aerosmith, Bon Jovi, ability to provide “room-scale VR” where Foo Fighters and Oasis. people can physically move around an environment, rather than simply turning The gameplay may be familiar, but there their heads. are some new moves for VR. “Special moves, like getting down on your knees Inspired by 1980s gaming, it’s aimed as or tantalizing the crowd with your much at casual music fans as working behind-the-head shredding, will earn you artists, with video tutorials provided to major points with the fans,” explained help people get up to speed. It’s currently Harmonix. being sold for £6.99.

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29 Feb Feb 2017 2017

Joshua Bell Red Bull

Sony Music has been one of the most Red Bull Media House launched its own active labels in VR, thanks to its range of VR content in February 2017, relationship with PlayStation VR maker with music videos part of the mix. Sony Computer Entertainment. The brand’s VR portal and its 360-degree In February 2017, the label launched a videos are accessible from desktop, PlayStation VR app for classical musician smartphones and tablets, as well as Joshua Bell. He was filmed in 360 through the various VR headsets. This degrees performing Brahms’ Hungarian being Red Bull, sports figured heavily in Dance No. 1 in the studio. The twist here the content: downhill skiing, urban involves rendering the venue in 3D, and exploring and surfing all featured. using positional tracking and audio, so that fans using the app can move around However, Red Bull also capitalised on its within the virtual environment, rather than music relationships, providing a VR just watching the performance from a version of Ben Harper, Jesse Ingalls and Jason Mozersky’s ‘When I Go’ – itself The Joshua Bell VR Experience, and has taken from the soundtrack to a surfing been made available for free. It’s part of documentary called ‘Let’s Be Frank’. Sony’s wider research into “new techniques for filming live events, More details particularly with music”.

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30 Jan Jan 2017 2017

Kygo Chocolate

Norwegian dance star Kygo got his own The Sundance Film Festival has been a VR app in January 2017, courtesy of a hotbed of VR filmmaking in the last partnership between Sony Music, Ultra couple of years, and in 2017 one of the Records and MPC VR, which has also hottest properties was a music video made VR projects for The Chainsmokers, called ‘Chocolate’. Pentatonix and OneRepublic. Based on a song by electronic artist Kygo’s app was initially made available Giraffage, it’s semi-interactive, with VR for the PlayStation VR and Oculus Rift industry website Road to VR describing headsets, although it has since expanded its charms best: “A short while into the to the HTC Vive. It’s based on his track song and a tingle in your robo-hands ‘Carry Me’, putting fans into a virtual hands causes you to look down just in world of oceans, forests, mountains and time to see them transform into ultimately the surrounding galaxy. cannon-hands that shoot out metallic kittens...” Sony chose to make the app a paid-for experience, selling it for $1.99 on the The video is the work of Viacom Next, the various platforms. Early response has experimental VR division of Viacom, been good: the app has a four-star (out which makes projects for its sub-brands of five) rating on the PlayStation Store, including MTV, Nickelodeon and while 87% of its user reviews on the Paramount Pictures. Steam store have been positive. More details More details

31 Dec Dec 2016 2016

Horizons StubHub

Horizons is one of the first VR music When StubHub has made headlines apps released for Google’s Daydream recently, it’s tended to be part of the platform. Published by UK-based startup heated debate around secondary Reactify Music, it’s pitched as “a series of ticketing. However, the eBay subsidiary interactive music journeys”. has also been exploring the potential of VR for its business. They feature computer-generated visuals to accompany several songs, with the A feature called ‘Virtual View’ made its viewer/listener encouraged to experiment debut in late 2016, enabling customers to with the Daydream headset’s controller to see the view from a seat before buying a manipulate the sights and sound of the ticket to sit there for a concert. The current track’s . feature is available through StubHub’s mobile app. “Use the Daydream controller to make an otherworldly jungle come alive with “It’s really about helping the customer sound, or travel at breakneck speed make the best choice about the ticket and through colourful hyperspace,” explained the price of the gig,” StubHub’s senior its app store listing. The plan is to create product manager Sam Flamand-Gloyne a new experience for each track added to told Music Ally in February 2017. “We’re the app, including the potential to launch seeing that people purchase more if they some for specific artists. do have that help.”

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32 Dec Oct 2016 2016

Pentatonix VRTGO

Pentatonix made their name as an a VRTGO isn’t an EDM star, even if it cappella group on YouTube, but for sounds like one. It’s the smartphone app Christmas 2016 they delighted their fans created by Universal Music Group to with a VR partnership with Lego, house its growing collection of VR videos. produced by visual effects firm MPC. It launched in October 2016 for Android It involved a performance of Christmas and iOS as a free download, as the result classic ‘Up On The Housetop’, with the of a partnership between UMG and band transformed into Lego minifigure startup VRLive. The launch came with a characters. performance from Avenged Sevenfold, streamed live within the app. The video was actually made available in three different forms, to ensure maximum At launch, the app also included videos reach. There was an app that worked on for OneRepublic, Shawn Mendes and headsets, including PlayStation VR, DNCE. The videos can be watched in Oculus Rift, Gear VR and Google landscape mode on the viewer's Cardboard. A 360-video version was smartphone, moving the device to look published on YouTube and Facebook, around the scenes in 360 degrees. A 'VR' and the video was also edited into a 2D button switches to a dedicated version to be televised on a Christmas virtual-reality mode for compatible Special show on NBC. headsets like Google Cardboard and Samsung's Gear VR. More details More details

33 Aug Aug 2016 2016

Night Fall Biffy Clyro

Night Fall has been described as “the Biffy Clyro were another artist to benefit world’s first VR ballet”. It was a project from Samsung’s investment in VR – and from the Dutch National Opera & Ballet, the content to support the marketing of produced with VR company &samhoud its Gear VR headset. Media and Chester Music, with backing from the ubiquitous Samsung. In August 2016, the band were filmed for a 360-degree video that was made Made available as a 360-degree video on available through the Gear VR. However, YouTube, the ballet includes original it was also part of the ‘Hypercube’ music composed by electronic artist installation that Samsung took to various Scanner. It promises viewers the British music festivals in the summer of opportunity to “enter a fascinating world 2016, giving fans a chance to get where the boundary between dreams and hands-on (or perhaps heads-on) with the reality seems to vanish”. video and headset.

As an example of art created for VR Up to 50 festival-goers at a time could (rather than simply converted to it) Night experience the video, which saw the band Fall is an impressive experience. The suspended in a perspex box above an video was published in late August 2016, abandoned warehouse. and by mid-March 2017 had been watched more than 323k times. More details

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34 Aug Jul 2016 2016

Starkey Deadmau5

Artist and producer Starkey was given EDM veteran Deadmau5 was another access to the Decca vaults as part of the artist exploring virtual reality through a classical label’s re:works compilation, partnership with a brand, in July 2016. and remixed Satie’s ‘Gnossienne No. 1’. Absolut Labs, the experimental marketing To promote the remix in August 2016, arm of the alcohol brand, worked with Decca created a 360-degree video Deadmau5 to create a Google Cardboard designed to be watched using VR app blending video of him in the studio headsets, or simply by clicking and with computer-animated visuals. It was dragging the mouse. Like other part interactive music video and part 360-degree videos, it was published on proper VR game. YouTube for maximum reach, with a video premiere on dance site Mixmag. Although the app was free for iPhone and Android smartphones, a branded Google The video was shot from the perspective Cardboard headset was sold to fans for of standing on a cliff at dusk as the track $17.95 as a limited-edition collectible – an plays, with lights in different shapes early sign of VR’s potential to be appearing in time with the music. The merchandise as well as digital content. numbers have been fairly low, though: just over 12.7k views by mid-March More details 2017.

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35 Jul Jun 2016 2016

Joan Jett Björk Digital

Rock veteran Joan Jett is one of many Björk is another veteran of the (short) artists to have made live performances lifetime of musical VR. Having released a available for VR viewing. 360-degree video for her ‘Stonemilker’ song in 2015, she developed the idea That includes a YouTube video of her with her own touring installation in 2016. performing ‘Cherry Bomb’ that was uploaded by Live Nation in July 2016, Called Björk Digital, it offered fans a notching up more than 160k views since chance to experience her most recent then. However, in August Jett also got album in virtual reality. Travelling to cities her own VR app for Samsung’s Gear VR. including Sydney, Tokyo, London and Paris, the exhibition used dozens of It was produced by the same company Samsung Gear VR headsets, as well as behind the Live Nation video, VR agency HTC’s Vive. Sveer, and presented the footage of Jett and her band the Blackhearts for headset Fans could experience four of Björk’s VR owners. “Experience what it's like to see short films, with the musician working the crowd from Joan's perspective and with VR firms like River Studios and also see the concert only inches away Within creator Chris Milk on the content. from Joan Jett and the Blackhearts,” as the pitch for the free app explained. More details

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36 May May 2016 2016

Paul McCartney Teach-U

Paul McCartney was actually one of the Teach-U isn’t a commercial app or first musicians to explore VR, through a fully-fledged startup yet. It was a project partnership with startup Jaunt in 2014. developed for the TechCrunch Disrupt The pair collaborated again with an Hackathon in New York in May 2016 by a announcement in May 2016 of a new pair of NYU Shanghai students. six-part VR documentary called Pure McCartney VR. They used Google Cardboard and an infrared sensor to track people’s gestures, Focused on his ‘Pure McCartney’ for an app that taught them how to play compilation album. Jaunt filmed the virtual drums and piano instruments. The former Beatle in his home studio, goal was to find a new spin on musical interviewing him about his memories education, using VR technology. relating to specific tracks, while also featuring archive footage. The VR “Our original idea was for a solitary VR element came from 360-degree shots as experience to practice music. We chose well as remastered and ‘spatially-oriented to take it to the next level by adding in ambisonic audio’. multiplayer networking and making this a collaborative experience,” wrote the The episodes were made available within developers at the time. Things have gone Jaunt’s own mobile app, as well as quiet since, but Teach-U was an published online. interesting glimpse at a VR category that could become very interesting. More details More details

37 May Apr 2016 2016

Rhapsody VR Warner Music UK

Rhapsody became the first How better for a label to explore VR than music-streaming service to launch its to start making 360-degree videos own VR app in May 2016, before the in-house? That was the thinking behind company rebranded as Napster. Warner Music’s decision to start filming artist interviews for distribution on The free app’s pitch: “Can’t make it to the YouTube in April 2016. show? Here’s the next big thing...” The promise was concert footage, with artists The first to get the treatment was featured at launch including Talib Kweli, Canadian artist Lights, who was Flatbush Zombies, Sweet Spirit and interviewed about her favourite things Shannon and the Clams. The videos while walking around a room containing could be watched on a smartphone those objects. The videos could be alone; with a Google Cardboard headset; watched on normal smartphones or or on YouTube – the performances have through a Google Cardboard headset. been filmed as YouTube 360 videos and uploaded to Rhapsody’s channel. The Lights video wasn’t popular: by mid-March 2017 it still only had just over It is unclear how successful the app was 600 views. However, the practical though: it has not been updated since experience of creating it will have June 2016, and the most recent 360 influenced WMG in its approach to other video on Napster’s YouTube channel was VR partnerships. published that same month. More details More details

38 Mar Mar 2016 2016

Abbey Road Ray LaMontagne

London’s Studios gave fans Ray LaMontagne might have come to a glimpse behind its walls with the prominence as a rootsy songwriter, but release of Inside Abbey Road – he’s also interested in technology. Cardboard in March 2016. It’s a free app for iPhone and Android smartphones, “I have been both fascinated by and produced through a partnership with immensely curious about virtual reality Google to promote Cardboard VR. technology,” he wrote in March 2016. “In both how content is created and in the The app includes a nine-part guided tour question of what its many possible narrated by Giles Martin (son of Beatles implications on our culture might be over producer Sir George) providing some time.” history of Abbey Road since the 1930s. People can then explore individual rooms LaMontagne got some first-hand within the studios: its famous mirrored experience via his partnership with Jaunt, drum room, and one of the mastering filming a 360-degree video for his ‘Hey, suites. The app also includes some No Pressure’ single, made available music: the London Symphony Orchestra through Jaunt’s app and on Facebook. recording a session in Abbey Road “I was blown away when I saw it for the Studio 1, offering a surround-sound (and first time,” wrote LaMontagne. “It is vision) experience for fans to enjoy. interpretive, artistic, beautiful, expressive, Albums and songs were also featured in and trippy as hell.” the store. More details More details

39 Mar Mar 2016 2016

Coachella NYT VR

2016’s Coachella music festival planned Labels are far from the only media entities to have a big virtual-reality element, interested in exploring VR: newspapers including shipping a branded Google and news sites are just as keen to Cardboard headset to everyone who understand its potential. But here too buys a ticket. there are music partnerships.

The idea was that the headsets would In March 2016, the New York Times use attendees’ iPhone or Android published a ‘Music Issue’ of its magazine, smartphones to run a dedicated and launched two 360-degree videos Coachella VR app, offering 360-degree inside its NYT VR app for iPhone and photos from previous years; a virtual tour Android to accompany it. The videos of the 2016 site; and the promise of came from Run The Jewels and The performances shot in VR of some of the Internet, with the former being an bands on the bill. atmospheric storm-lashed video, and the latter being a studio performance. Coachella partnered with Vantage.tv on the VR elements, which were presumably Both videos were also published on intended to be used mainly once YouTube: The Internet’s on the NYT’s attendees were back home after the channel and Run The Jewels’ on their festival, rather than in situ. own channel, which explains their respective 87k and 400k views. More details More details

40 Feb Feb 2016 2016

Years & Years Polydome

Years & Years were one of the first bands “Step into the Polydome,” invites the to take advantage of Samsung’s desire to Oculus Store listing for free app market its Gear VR headset using music. Polydome. “A place where you can explore a new way of creating music, and The Polydor artist teamed up with experience it all around you.” Samsung in February 2016, playing a four-song set in London that was Developed for Samsung’s Gear VR streamed live to fans who owned the headset, Polydome is among the first of a Gear VR. They could switch between crop of music VR apps focused more on three different camera angles while creation than consumption. It’s the work watching: the front row of the venue, on of developer Plan8, and first emerged as stage with the band or floating above the a finalist in Oculus VR’s ‘Mobile VR Jam’ stage. competition in 2015.

Here, the creation process involves For fans who couldn’t watch live on a manipulating ‘gems’ within the virtual Gear VR, Samsung subsequently made environment. In the original version, these footage from the performance available interactions were a mixture of gazing, as 360 videos on its YouTube and tapping and speaking (via the Facebook profiles, as well as within a microphone) to trigger different effects. ‘Samsung + Years & Years’ app in the Oculus app store. More details

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41 6

The music industry can plot a path Food for Thought between evangelism and scepticism to explore the potential of VR

Like many technologies, virtual reality has conclusion to draw, but Music Ally’s view its evangelists and its diehard doubters, is that labels and musicians would be wise but also plenty of people in between who to situate themselves within the third of are keen to experiment and explore its those groups: the experimenters and potential. Stop us if this is an obvious explorers of what VR can do.

42 Be wary of anyone getting ahead of “I don't know if there was something that themselves in proclaiming that VR is the folks could have done to make that music industry’s next major new format, happen fast, but I think that was pretty but equally, don’t fall into the trap of good,” Zuckerberg told analysts in looking at early sales of the current February 2017. generation of VR headsets and writing off the technology entirely. “And, I mean, if we can be on a similar trajectory of anywhere near 10 years for As a man whose company ended up VR and AR, then I would feel very good paying $3bn for Oculus VR – the initial about that, and I feel like we're making the offer of $2bn plus $1bn to retain its team right bets now to plant the seeds for that. and pay agreed bonuses – Facebook CEO But I would ask for the patience of the Mark Zuckerberg is understandably keen investor community in doing that because to stress the long game in VR, comparing we're going to invest a lot in this, and it's it with the decade that smartphones took not going to return or be really profitable to reach 1bn units shipped. for us for quite a while.”

43 Facebook might not be expecting VR profits any time soon, but over the course of that decade, there will be money to be made by providers of VR content, with the balance tilted initially towards funding from Facebook, Google, HTC and other VR platform owners, but as the number of headsets in use grows, consumer spending and brand-funded content will become more of a factor too. The other important reason for our industry There are several reasons for the music to get its hands dirty with VR is the chance industry to get involved now. First, there’s to creatively define the medium: to figure the chance to get some of that out what a successful musical-VR platform-holder funding and explore the experience is, and how it differs from what medium, learning the lessons which will we’ve seen before in the audio, video and pay off when (or, admittedly, if) VR interactive worlds. becomes much more mainstream. Every new medium goes through its phase There is also the chance to track the of replicating what went before: from early technical evolution of virtual reality from TV news broadcasts that pointed a static within, rather than as outsiders. One camera at a radio presenter, to films that example is the debate about whether essentially pointed a static camera at a mobile VR – currently epitomised by theatre stage. The equivalent in 2017 for smartphone-using headsets like the Gear music and VR is sticking a 360-degree VR and Daydream View – will be the better camera in a venue and filming a concert. path to the mainstream than tethered VR That’s a little unfair to startups like devices like the Rift, Vive and PSVR. By MelodyVR, which is building a catalogue of getting experiences out on a variety of that kind of content, but which has also platforms and working with those platform talked publicly about its desire to explore owners, music companies will be closer to other kinds of VR experience too. The the trends that define how VR looks and launch of its app this year will be an works a decade from now.

44 important test-case for the first level of VR gaming: entertainment experiences set in music experience though. virtual worlds, with computer-generated characters and environments, and If it works, that’s good news for the interactivity for the player. industry: more ‘immersive’ VR concert footage may spark more fans to part with This feels like fertile territory for musicians their cash than for traditional live-music and labels to explore, and not just through broadcasts, which (DVDs aside) have licensing music to games like Rock Band tended to be free: either promotional or VR – although that will be an important part of wider brand partnerships. part of the revenue pie for rightsholders in the coming years too. If MelodyVR’s app doesn’t catch on – given the praise the company has won for Sony Music’s strategy has been its team, technology and approach to particularly interesting here. Three of its rightsholders – it may highlight a lack of projects that we’ve profiled in this report – consumer interest in 360-degree concerts, for Kygo, Pentatonix and The which may in turn fuel efforts to explore Chainsmokers – focused on virtual other kinds of musical VR experience. environments and interactivity rather than 360-degree videos. A fourth project, for One path may be to focus less on the classical musician Joshua Bell, involved ‘reality’ part of virtual reality. The current wave of VR hardware has its roots firmly in

45 Universal Music Group’s CTO Ty Roberts told Music Ally in late 2016 that he sees potential for music VR formats allowing “multi- person interactivity” where fans experience music together.

“Games tend to be more competitive. I want rendering a performance environment in something more social, emotional and 3D so that fans could move around it. collaborative. It’s going to transform it from a passive experience to an active When Kygo fans are sent floating up into experience,” he said. “As an example: do the sky; when startup TheWaveVR’s CEO you want to go on a virtual date with says “If they use a Bitcrusher, that might someone you’ve met across the internet turn the world to pixels – and the audience inside a Peter Gabriel album, and walk experiences all of this stuff in real-time. around Peter Gabriel’s world together? The DJ can even hit a button at the drop That kind of experience is going to be and blast everyone off into space”; when possible.” fellow startup Mbryonic’s CEO says “Imagine going to see a rock band on top Will people pay for this kind of experience, of a mountain with fire-breathing dragons and if so how much? At this stage, there overhead… or a dance club where the isn’t much evidence to draw on. Some walls are pulsating”... These are all games have performed well in the early examples of how VR can provide new days of this round of VR: one called Job ‘hyper-real’ experiences around music. Simulator (pictured) reached $3m of sales in its first year after release. This may be There is much more to explore here, and because it’s VR-in-2017’s equivalent of evidence that labels and musicians are apps-in-2008’s Super Monkey Ball, which keen to understand whether this kind of made millions in the early weeks of Apple’s content is what will draw music fans to VR.

46 App Store due to being the best game in a want to convince mainstream consumers relatively small catalogue. that VR is about more than gaming. Those companies will have strong incentives to “Today there’s a phenomenal appetite for encourage, promote and perhaps fund people to pay for things in VR. If you take inventive music experiences. the [iPhone] App Store, there’s three million apps on the App Store, but there’s It’s the creative opportunity that lingers in sub-350 for VR currently, so the appetite Music Ally’s mind, though. From Sony for content is great,” said MelodyVR’s Music collaborating with top Hollywood Steven Hancock at the FastForward visual-effects companies – most firms in conference in February 2017. that world now have VR arms – to independent labels and musicians teaming He did not duck the implication that this up with talented developers and startups, may be misleading about the longer-term ingenuity of ideas will be as important as business models for VR, in the same way the size of budgets. As the music industry that Super Monkey Ball’s healthy sales as emerges into a streaming-fuelled era of a $9.99 download in the summer of 2008 growth, it has plenty of ideas, and the did not foreshadow the dominance of resources to take a few risks on trying free-to-play games with in-app purchases them out in a new medium. on the app stores a few years later. “There’s a great opportunity in VR because “There will come a time when people will there’s no established VR platform,” said stop paying for it. I think we’re a long way UMG’s Ty Roberts. “There are 50 different off that… 24 to 36 months,” said Hancock. companies making different things to show Another reason for the music industry to off with VR, and we can be one of those. be fully engaged with VR in 2017 is to The format isn’t fixed yet, which is our properly understand whatever transition opportunity to experiment.” lies ahead in that next three years.

Without being arrogant, the music industry should also think about the value that it can bring to the VR ecosystem. Music could be crucial to the likes of Oculus, HTC, Sony, Google and Samsung if they

47 ABOUT US Music Ally is a UK-based company providing information, training and consultancy for the music industry.

We run a premium research service that includes a daily news bulletin, a monthly analysis report, and a fortnightly digital music marketing report.

The company also runs training sessions for companies across the industry, and has provided consultancy services for music firms from startups to large label groups, digital service providers and technology companies.

You can sign up for a free trial to our research service here on our website – http://www.musically.com/subscribe/ – or email [email protected] for information on our other services.

This report was researched and written by Music Ally’s contributing editor Stuart Dredge.

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