Your Friendly Neighborhood Jukebox

January 19, 2008 by

The following piece originally appeared in the September issue of Playmeter magazine, a trade journal for the coin-operated amusement industry.

Jukebox music is a shared experience. We can listen to our favorite songs as often as we’d like in our homes and on our headphones, but we are drawn to share music with the communities of people we find at our local taverns.

Traditionally, the music offered on a vinyl or CD jukebox has made a statement about the character of those taverns. Walking into a joint and finding a lot of Gretchen Wilson and Rascal Flatts on the jukebox is very different from finding the juke packed with show tunes. We learn something about the people who hang out there and we are invited, at a cost of three plays for a dollar, to be part of the community.

Recently my girlfriend and I traveled to a small town in Michigan and went to the local roadhouse to watch a Detroit Tigers baseball game with an old friend of mine. Instead of the TV sound, the jukebox was playing. Some guys were shooting pool and experimenting with the new digital machine that had recently replaced the CD jukebox. These fine fellows treated us to about 45 minutes of songs by the metal band Slayer, courtesy of the machine’s central server and its “Make Mine First” feature. The barmaid apologetically assured us that this wouldn’t have been possible with their previous jukebox. Old-school heavy metal didn’t seem consistent with the character of the place.

Reflecting on our experience, it occurred to me that digital jukeboxes subtly, but significantly, alter our location communities. If, via downloading, virtually any song is available at any time, it makes one person’s desires more important than those of the community. The character of that community is changed.

If every jukebox offers essentially infinite choices we run the risk of homogenizing the location music experience — or at least turning the place into somebody’s personal slumber party. Personally, I don’t want someone to be able to play Justin Timberlake’s “SexyBack” at my favorite watering hole, just like I don’t want to eat at TGIFriday’s when I visit Chicago.

There’s no questioning the fact that the rise of digital technology has altered all forms of entertainment. The seemingly unstoppable force of digital music is changing traditional business models. The recording industry is under siege, seeking to defend itself with the blunt instrument of litigation. Music consumers hunger for the convenience and immediate gratification that digital music promises. We can’t go back and we can’t shut our eyes. Now more than ever it is critical that operators be wise and keep a close eye on the more subtle shifts in the jukebox business model.

Our taverns stand to lose a bit of their unique character with the advent of digital music; that is probably just a sign of the times. More importantly, operators seem to be sacrificing some of the autonomy of their locations, even as they’re enjoying a net gain in the cashbox with the new technology. New so-called “intelligent music management” systems claim to select the most appropriate music for a location without operator involvement. With the shift toward cashless, card-based transaction processing, remote collection is becoming a practical reality.

At the 2008 ATEI trade show in London, I spoke with one digital jukebox music provider who explained that their system automatically updates tracks to fit location profiles. This representative went on to make the claim, “Never again will a customer pick a track that will ruin an atmosphere.”

Music content programming has traditionally been the responsibility of the operator. Granted, the music provider I spoke with at ATEI is serving the UK and not the States, but in any centralized system the operator gives up a certain amount of control. In a television interview aired last year, a representative of one domestic jukebox music provider discussed his role in music programming for their entire network. “Our operators don’t necessarily know what the hot records are. I’m that guy for all of our jukeboxes.” He went on to explain that all the updates to their system are handled remotely.

Another domestic music provider claims on their Web site that they “work hard with the operators to create hard drives that contain the right mix for any demographic group.” There are 18 different packages available, and those can be customized within the first 30 days the machine is on location. My sense however, is that most boxes aren’t being customized; it’s easier and more profitable for operators to allow patrons to program a box themselves with premium-priced, on-demand downloads from the server.

Yet another domestic music provider, as I understand it, still has a majority of its machines on location without patron Internet access to its server. These machines are deployed with hard drives that often contain the provider’s entire library of songs. For their Internet-enabled machines, they offer patrons the ability to create play lists away from the location. Interestingly, their Web site describes a new feature of the operating system as follows, “Your jukebox will send you an email to anticipate problems so you can take care of business.”

I’m not encouraging technophobia or trying to arouse “Big Brother” paranoia. It is, however, important to be aware that the digital age is bringing profound changes to media-based business models. Digital music is increasingly seen as an advertising-supported proposition in most markets. One domestic jukebox music supplier went so far as to describe their digital jukebox as a “Trojan horse for a media network.”

Advertising has become the true prize in the competition for digital jukebox network connections. This focus on delivering a “common denominator” to advertisers will continue to homogenize the location music experience. It will also take vast amounts of information about locations and patrons out of the hands of the operator. Operators should be aware of this and consider the implications.

In another corner of the digital music world there is an interesting new development that may present some new opportunities and alternatives for jukebox music. The major record labels are beginning to embrace the concept of selling DRM-free music. That is, tracks that carry no copy-protection scheme. All four major labels agreed to supply Amazon with unprotected tracks in an effort to create a viable competitor in North America to Apple’s dominant iTunes. That initiative is experiencing some success, evidenced by Amazon’s announcement of a similar European venture.

In the near future there may be an opportunity for alternative jukebox business models, driven by DRM-free digital music. A proactive trade association like AMOA could conceivably negotiate an omnibus licensing agreement with the publishers and the performing-rights organizations. Such an agreement could be similar to the Jukebox License Agreement, allowing operators to acquire digital music legally from a variety of sources. For instance, tracks could be purchased at a rate determined by the number of jukeboxes licensed to an individual operator. Such an agreement would help operators maintain their autonomy and could bring down the cost of digital music.

The technology exists to support a wide variety of legal alternatives for digital jukebox music. As with most digital music business models, the most difficult hurdle for our industry is licensing.<!> This is a critical time in the history of the jukebox business. Operators have a significant opportunity to work together to preserve the unique character of taverns and other locations. Our local watering holes should be a refuge from the relentless intrusion of advertising and its inevitable cultural homogenization. I want to go where everybody knows my name, not my demographic profile.

Categories: Blog, Jukebox