{"id":1171,"date":"2015-12-05T16:00:12","date_gmt":"2015-12-05T21:00:12","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/the-hype-machine-more-than-just-the-hype\/"},"modified":"2015-12-05T16:07:05","modified_gmt":"2015-12-05T21:07:05","slug":"the-hype-machine-more-than-just-the-hype","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/the-hype-machine-more-than-just-the-hype\/","title":{"rendered":"The Hype Machine \u2013 More Than Just The Hype"},"content":{"rendered":"<p>Disclaimer: This blog post is was prepared in collaboration with The Hype Machine. \u00a0I listened to its Popular \u2018Last Week\u2019 playlist through the writing of this post \u2013 just as I have tuned into its music pretty much every time I\u2019ve been working over the past five years.<\/p>\n<p>The Hype Machine, started in 2005, is <strong>a music aggregator which compiles and streams music from hundreds of different blogs on its site<\/strong>. \u00a0The website created to solve a common problem with finding new music \u2013 conventional new music sources were often heavily influenced by those with the greatest ability to pay, while independent music blogs were widely scattered and time-consuming to keep up with.\u00a0 It enables users to find, listen, rate, and engage with new music and other new music listeners and dialogue in a single place.\u00a0 Users like myself can \u2018love\u2019 songs, saving songs to personal playlists, with the site producing the Popular List for the last three days and the previous week using the \u2018loves\u2019 given by its users.\u00a0 The convenience of this, along with many other features, creates value for its users by providing up-to-date with new music and acts with minimal time and effort.<\/p>\n<p><iframe loading=\"lazy\" title=\"Interview: Anthony Volodkin\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/e2sHuU-tmAk?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p><strong>The Hype Machine is free<\/strong> \u2013 another value add to users \u2013 as all the music being streamed is publicly available.\u00a0 While this creates low costs, it also means that Hype Machine can\u2019t charge for the music its streaming, and so <strong>relies primarily on ads and affiliate revenue in order to capture value<\/strong>.\u00a0 It employs banner and side ads, and takeovers where an artist or advertiser advertise on the wallpaper.\u00a0 Consumers appear to be broadly fine with this advertising, so long as the content on the site is not \u2018gamed\u2019 \u2013 that the delineation between advertising and content remains clear.<\/p>\n<p>For affiliate revenues, it tracks concerts, lets users know which musicians they listen to are playing near them, and provides links to tickets.\u00a0 It also has links to purchase tracks alongside the streaming, enabling users to easily buy songs on multiple platforms.\u00a0 Hype Machine receives a share of revenue for track and ticket sales under these affiliate arrangements.\u00a0 It also sells merchandise associated with its branding and community.<\/p>\n<p>Over time, it has increased its content to generate further page views and, as a result, page views and affiliate revenues.\u00a0 It now aggregates music videos and does events, including a Mazda-sponsored curated show at SWSX.\u00a0 It also has an app which it charges for because of the limited ability to capture advertising revenues.<\/p>\n<p><iframe loading=\"lazy\" title=\"SXSW Mazda recap\" width=\"640\" height=\"360\" src=\"https:\/\/www.youtube.com\/embed\/e3T1LSuMJlk?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p>Underpinning the Hype Machine\u2019s business model is a lean operating model, which enables it to keep costs low and reinforces its competitive advantage.\u00a0 <strong>It requires virtually no labor costs<\/strong>, having barely surpassed five staff.\u00a0 It takes advantage of the work of its chosen bloggers, who are compensated with additional traffic driven to their content and, ultimately, their own ad and affiliate revenues.\u00a0 This creates a virtuous cycle where bloggers are incentivized to create more content to be aggregated and drive even more traffic in return.<\/p>\n<p><strong>It also requires virtually no physical assets.<\/strong> \u00a0\u00a0Originally, streaming was routed through the blogger\u2019s website, placing the additional traffic, streaming and hosting costs on the blogger, and meant that the data on streaming went to the blogger, rather than the musician or label. \u00a0This placed significant burden on bloggers to have adequate bandwidth for the additional streaming being generated.\u00a0 In 2010, Hype Machine partnered with Sound Cloud to stream the songs from its site.\u00a0 This mean that bloggers spent less time worrying about hosting files, and artists and labels \u2013 who see and control the content on Sound Cloud \u2013 gained access to the stream analytics.\u00a0 Doing so created value for Sound Cloud, with more content being put on their service along with more views and data, but also placed the streaming burden with a sustainable long-term partner.\u00a0 <strong>Further, intellectual property is effectively fully outsourced<\/strong> \u2013 to the bloggers and to musicians, who are paid only with page views, streams and data.<\/p>\n<p>This \u2018page view\u2019 payment on which the operating model is based reinforces value created by the company for consumers \u2013 the authenticity of the content. <strong>By operating in this way, the Hype Machine continues to create both real and perceived value for its entire community.\u00a0 <\/strong>The authenticity in its content \u2013 something competitors Pandora and Spotify haven\u2019t been able to achieve, and have had to move to music product placements, inter-song advertising and subscriptions \u2013 and in its operating model is what provides its sustaining competitive advantage.<\/p>\n<p>Sources:<\/p>\n<p>http:\/\/hypem.com\/about<\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"vom2GV3fiG\"><p><a href=\"https:\/\/blog.hypem.com\/2009\/09\/on-integrity-advertising\/\">On Integrity &#038; Advertising<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;On Integrity &#038; Advertising&#8221; &#8212; Machine Shop\" src=\"https:\/\/blog.hypem.com\/2009\/09\/on-integrity-advertising\/embed\/#?secret=vom2GV3fiG\" data-secret=\"vom2GV3fiG\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"Q6d4sMV8lx\"><p><a href=\"https:\/\/blog.hypem.com\/2009\/06\/on-chart-integrity\/\">On Chart Integrity<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;On Chart Integrity&#8221; &#8212; Machine Shop\" src=\"https:\/\/blog.hypem.com\/2009\/06\/on-chart-integrity\/embed\/#?secret=Q6d4sMV8lx\" data-secret=\"Q6d4sMV8lx\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p>http:\/\/thenextweb.com\/apps\/2011\/10\/18\/online-dance-party-the-hype-machine-announces-1-million-users\/<\/p>\n<p>https:\/\/blog.soundcloud.com\/2010\/01\/25\/soundcloud-the-hype-machine-%E2%99%A5\/<\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"Z9qNsE1bcI\"><p><a href=\"https:\/\/techcrunch.com\/2010\/01\/25\/soundcloud-teams-up-with-hype-machine-to-service-music-bloggers-better\/\">Soundcloud teams up with Hype Machine to service music bloggers better<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;Soundcloud teams up with Hype Machine to service music bloggers better&#8221; &#8212; TechCrunch\" src=\"https:\/\/techcrunch.com\/2010\/01\/25\/soundcloud-teams-up-with-hype-machine-to-service-music-bloggers-better\/embed\/#?secret=y7GH92W5oP#?secret=Z9qNsE1bcI\" data-secret=\"Z9qNsE1bcI\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p>http:\/\/www.inc.com\/30under30\/2009\/profile_hype_machine.html<\/p>\n<p>http:\/\/larrysukernik.com\/blog\/2015\/3\/29\/strategies-for-spotify<\/p>\n<p>http:\/\/jessepollak.me\/am-i-killing-the-thing-i-love\/<\/p>\n<blockquote class=\"wp-embedded-content\" data-secret=\"rwlAYILi8T\"><p><a href=\"https:\/\/blog.hypem.com\/2009\/02\/how-we-pick-blogs\/\">How we pick blogs<\/a><\/p><\/blockquote>\n<p><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;How we pick blogs&#8221; &#8212; Machine Shop\" src=\"https:\/\/blog.hypem.com\/2009\/02\/how-we-pick-blogs\/embed\/#?secret=rwlAYILi8T\" data-secret=\"rwlAYILi8T\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe><\/p>\n<p>http:\/\/thegearedlife.com\/hypemachine\/<\/p>\n<p>http:\/\/money.cnn.com\/magazines\/business2\/business2_archive\/2006\/10\/01\/8387122\/index.htm<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By having an operating model founded on nothing more than &#039;page view&#039; payment, the Hype Machine has been become an authentic, authoritative new music source<\/p>\n","protected":false},"author":883,"featured_media":1174,"comment_status":"open","ping_status":"closed","template":"","categories":[74,111,249,147],"class_list":["post-1171","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-crowd-sourcing","category-internet","category-music","category-streaming"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/the-tom-challenge-tom-winners-and-losers-assignment\/","yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>The Hype Machine \u2013 More Than Just The Hype - Technology and Operations Management<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/the-hype-machine-more-than-just-the-hype\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Hype Machine \u2013 More Than Just The Hype - Technology and Operations Management\" \/>\n<meta property=\"og:description\" content=\"By having an operating model founded on nothing more than &#039;page view&#039; 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