Unless you've been catatonic in a closet for the last five years, you know that music streaming platforms like Spotify, Pandora, TIDAL, and Apple Music have become the new "radio." Nielsen reports that 80% of you now use at least one of these services on a regular basis, a steady increase (+5%) from this time last year. As a business, streaming music is so widely adopted that it's even starting to breathe new life into the flatlining record industry; 2016 was its strongest growth year since the late-90s, according to a mid-year report from the Recording Industry Association of America, and, for the first time, streaming revenue offset the diminishing sales of CDs and mp3 downloads.
So, after a long white-knuckle race through the fog, we can finally see technology's taillights up ahead and we are catching up. For music consumers, streaming services – whether subscription-based or ad-supported – are the clear-cut preference and will be for the foreseeable future.
Which begs the question: when will someone create a service specifically for DJs, packed full of dope dance tracks, that works with my favorite DJ performance software? The answer is, "Someone finally has – it is called Pulselocker."
Pulselocker, the brainchild of Alvaro G. Velilla, a former record label exec and dance industry veteran, Ben Harris, founder of the Grammy-winning early-00s electronica group Dirty Vegas, and Joshua Goltz, is the first streaming service designed and optimized for DJs. The technology has cut a new trail for dance music discovery and – already integrated into the Serato and Pioneer platforms – is poised to transform the way DJs consume and perform with music.
As co-founders, Alvaro and Ben had no previous tech experience before starting the company. But, unlike so many opportunistic tech interlopers who have crashed the EDM party in recent years, they have electronic music coursing through their veins. At the beginning and end of the day, it's what they care about most. Like all pathfinders, they faced many early challenges in building something new, including technology failures and constant battles with a fearful music industry, but their passion for DJ culture and commitment to a basic idea drove them through the woods to innovation.
I sat down with Alvaro and Ben recently to discuss their technology, how it works, and the wider implications Pulselocker has on the music industry.
Q: Let's just cut right to the elevator pitch: What is Pulselocker?
Ben: Pulselocker is the music streaming service for DJs created by DJs. We're all DJs here; even our Chief Engineer used to run club nights in his younger years. We provide a new way for DJs and dance music fans to discover and consume music. Through our monthly subscription model, Pulselocker gives DJs unlimited access to our catalog of over 44 million tracks, and through our integrations with DJ software companies, DJs access that music directly through their favorite DJ application – both online and offline – through our patented "locker" technology.
Q: How was this idea first hatched?
Alvaro: The Pulselocker concept originated in late 2010. Around that time, music consumption patterns were stagnating. A new generation of consumers were exhibiting buying behavior that valued access over ownership, and it was becoming obvious that somebody had to take a new approach to serve their needs. Our early recognition of this cultural shift put Pulselocker ahead of the curve at inception. Still, nobody in the industry initially thought our technology and model was viable.
Q: Describe the incubation process. How did you take Pulselocker from a great idea to an actual product?
Ben: It's been a huge undertaking. Like many products, the service has gone through multiple iterations to get the experience to where it is today. But our core commitment has always been the same: give DJs access to more music. We wanted to provide a service that makes sense to DJs and thinks the same way they think – such as searching a library by record label. Also, DJs need to perform with that music, so Pulselocker’s seamless integration with all relevant DJ software was a key piece of the puzzle.
Q: What were some of the initial tech hurdles?
Ben: We started with a native application and a "locker" technology that hacked into Serato and Traktor. Unfortunately, software release updates would cause us problems so we took a different approach. We found that a Web browser experience worked better but still fell short of our greater goals for performance and usability. Through persistent trial-and-error, we realized that working directly with DJ software companies would be required to fulfill our initial vision. To achieve these software integrations, our team of just four engineers committed to rewriting our entire codebase from the ground up. They pulled it off in under a year, which really speaks to our team’s internal commitment. We put all of these pieces together to form what Pulselocker is today.
Q: Once you arrived at this type of business model, getting cooperation from the established DJ platform manufacturers was essential. What was their reaction?
Alvaro: It took some time to get agreements because we weren't a well-known brand and the technology was still very new. Luckily, our partners understood the vision and felt it was aligned with their customers' needs. They definitely took a risk but, at the same time, it was clear to them that the Pulselocker model and technology would eventually become ubiquitous. They knew it wouldn't be easy but, for most of these companies, being on the cutting-edge is part of their DNA.
"We have developed a unique technology that allows you to download unlimited songs to your computer and play that music with your DJ application without an internet connection."
Q: Let's talk a bit about the practical functions of Pulselocker. Do I need a wired Ethernet connection and a huge data pipe? The elephant in the room, of course, would be loss or degradation of Internet access while a few thousand people in the audience overload the network with selfies and live streaming. That would be a non-starter for most DJs. Help assuage our fears and tell us, in a nutshell, how the software works.
Alvaro: We have developed a unique technology that allows you to download unlimited songs to your computer and play that music with your DJ application without an internet connection. Those songs live on your computer for as long as you hold a valid Pulselocker subscription. In other words, our customers are able to stream all the music they want on our website or mobile application and access their own existing playlists, as well as Pulselocker's entire library, directly from within their favorite DJ application. If they chose to, they can also take all their music to places with poor or no Internet connectivity at all. We believe that this new way of discovering and interacting with your library is going to set the new standard.
Q: Something like Pulselocker seems like the next logical step for DJs. Streaming services are here to stay and, traditionally, DJs have been the earliest adopters of new technology. Yet the dance industry standard – from both a performance and retail perspective – is still stubbornly based on downloads. Talk about the technical and psychological challenges you face with overcoming this orthodoxy.
Alvaro: Yeah, this is one of the biggest challenges we face in terms of market penetration. Because of the reliability standards the job demands, the DJ community – which, as you say, has been the most forward-thinking in terms of technology adoption – has been mostly conservative in terms of music acquisition patterns. Undoubtedly, there are still a number of fundamental issues with connectivity across the board, but in terms of usability in a DJ context, it really depends on what your personal preferences or needs are in a particular situation.
It's also important to remember that the biggest market is actually the illegal or pseudo-illegal one such as torrents, fraudulent mp3 download portals, or many promo pools that operate in grey areas. These are hugely successful products generating a sizable subterranean economy that rarely reverts back into the industry. Ben and I both have experience in music distribution so we were able to understand these problematic areas as we set out to build the first fully licensed DJ-centric streaming platform. As our product grows and evolves we are convinced the market will embrace it for its ease of use, integrations with DJ software, unique off-line capabilities, and music catalog.
Q: As we have seen over the last decade or so, the record industry is very wary of technology and new models that go against the status quo. Clearly, getting the music labels onboard with your vision was a huge early objective for you. What was that process like?
Alvaro: From the beginning of the project we've fought against all odds at many different levels. I would say that, besides being able to build our technology and finding the right team, getting labels and distributors onboard has been one of the most challenging areas. It required years of tremendous team effort and consistency. I clearly remember our first MIDEM and ADE in 2011 when, after hearing about Pulselocker, most companies looked at us as if we were coming from another planet. But then we definitely started to notice a general attitude shift around the end of 2012, probably thanks to the standardization of streaming services.
Q: Was security a concern for them?
Alvaro: Yes. At the very beginning, their main concern was that DJs were not going to be able to steal music from our platform. In truth, we represent the first real alternative to digital piracy in this market! Over time, it also became clear that some of the more traditional distributors saw us as a threat to their mp3 download business. Luckily, the major labels and Merlin Networks were receptive to the concept when they saw that we were building a product not just for Electronic or Hip-Hop DJs but for all types of digital DJs – a considerably bigger and more diversified market.
We feature the largest, richest, and most diverse catalog of any DJ-centric product in the market.
Q: Ultimately, the success of a music platform comes down to its library, especially in a market as specialized as electronic music. What are some of the labels you have deals with?
Ben: It would probably be easier to tell you what we don't have! We currently maintain licensing agreements with about 95% of the industry, including the three majors – Sony, Warner, and Universal – as well as Merlin Networks, which represents over 20,000 independent labels, plus over 60 independent aggregator and label deals. To name just a few specific labels in our library … CR2, Spinnin', Toolroom, AUS Music, BBE, Mad Decent, Hospital Records, Big Beat, Def Jam, Nervous, Armada Music, PIAS, Beggars Group, Southern Fried, Skint, Ultra Music, Dim Mak, Owsla, Ninja Tune, Kontor, and Black Hole.
Alvaro: We feature the largest, richest, and most diverse catalog of any DJ-centric product in the market – not only for electronic music DJs but for anybody who uses a piece of software to perform. One of the unique characteristics of Pulselocker is the granularity of our music discovery process, something that customers are only going to find on some traditional DJ mp3 stores. We currently feature 36 genres manually curated by our teams in San Francisco, Berlin, and Barcelona. This includes not only relevant new releases but also the best of our music partners' back catalog. We keep adding tens of thousands of new releases per month and we are constantly cleaning and polishing the catalog.
Q: Speaking of music discovery, how did you two discover electronic music?
Ben: As a kid, I loved all kinds of music and I started going out to clubs at 16 years old. I was mainly into Hip-Hop and Acid Jazz which drew me to an underground night called "Dance Wicked" in Vauxhall, London (1988, I think). The main room was mostly Hip-Hop, but they had a tiny back room that played House music and each week I would spend more and more time in there. After that, I started going to other nights like Danny Rampling's, "Shoom". That was a fun time back then!
Alvaro: I got exposed to Electronic Music for the first time at a very early age, almost by coincidence. One of my friends got a pair of turntables and a mixer for Christmas and I remember feeling drawn to mixing and beat-matching right away. It was around '88 or '89 – very exciting times in Europe! Another really important factor for me was, without a doubt, Sonar Festival. I attended for the first time in 1996 and, over the years, it played a crucial role in educating my generation, not just about new electronic music tendencies but also about its history, roots, and evolution.
Q: Tell us about your previous careers in the industry.
Ben: I started out as guitarist in a band with schoolmates and quickly transitioned to becoming an assistant at a recording studio in Camden, London. I learned a lot about the recording process and got to work with many different artists from all genres. I then opened a vinyl record store with my brother. We sold mainly House and Techno and that's where I got to meet a lot of people in the dance music scene in London. I had started producing my own tracks by then and signed my first record to Virgin. It was also there that I met [Dirty Vegas bandmate] Paul Harris who used to buy records from the store. We formed a production and remixing team called Hydrogen Rockers and things started happening pretty quickly for us. Hydrogen Rockers morphed into Dirty Vegas and that was my career for the next ten years. I actually met Alvaro through the band being signed to Om Records, where Alvaro worked.
Alvaro: In my early twenties, after finishing school, I landed a job at a vinyl distribution company in Barcelona, initially packing vinyl in the warehouse and eventually moving to the sales department. Over the following years, I worked for a few other distributors in different capacities which eventually led me to Ibiza, where I lived for over seven years, working for the Urgell family as Pacha's label manager. In late 2008, I left behind everything and everybody I knew and moved to the U.S. to work for Om Records in San Francisco. During all these years in the music biz, I've worked at pretty much every position at a label or digital/physical distributor: label owner/manager, A&R, sales, distribution, business development, account manager, licensing, vinyl buyer, etc. Now, with Pulselocker, I'm able to draw on all this industry experience and apply some of the fundamentals from the old model toward something totally new as Chief Product Officer.
"To beat 'free,' you have to offer something worth paying for."
Q: Looking at the trajectory of the music industry, we now live in a world of stubborn consumers who expect this content for free. The dance industry, especially, is rife with piracy. How can you jump this hurdle and build a viable business?
Ben: To beat "free," you have to offer something worth paying for. So we set out to build a better service than the pirate sites, with a more engaging user experience, and make the entire process – from discovering new music to organizing and performing with that music – as streamlined and easy to use as possible. We have a lot in the pipeline to keep improving the service, such as a mobile app coming in the Fall. We talk to our customers all the time to find out what they want from the service and how we can improve.
Q: Ben, you come from an artist's perspective. Lately there has been a rising chorus of high-profile artists united in opposition to streaming platforms like Spotify and YouTube. What do you make of their arguments and how do you reconcile this with the Pulselocker model?
Ben: I think those arguments that you're referring to were predominantly against services that provide a free tier, where the only revenue is small amounts from advertising. At Pulselocker, we do not offer a free subscription tier. We believe in creating a service that has value and one that is good enough that people are willing to pay for it. We believe in artists and labels getting paid for their work and we believe in always striving to offer a better service to our customers. Opinions and stances that people take in this business change all the time. Until recently, we had big artists holding out on streaming services. Now we have high-profile artists doing exclusive deals with them as the big guns fight for exclusivity in the mass-market streaming turf war. It changes all the time. It boils down to all sides fighting for their piece of the new music business.
Q: Spotify has 40 million paid subscribers yet they are not profitable. What is your prognosis for the future of the streaming music business?
Ben: Spotify also has 70 million people using it for free! Switch those two numbers around and that might help them out! In the last ten years, the internet, piracy, and technology have shaken up this industry more than at any other time, but now the industry is finally catching up. It is still tuning a model that works for everyone, but this is a great time to be in music. The future looks bright!