Categories
Issue 8

(Mis)leading Spotify Chart Toppers: What is India listening to?

A quick glance through Spotify India’s charts will leave you surprised. India’s Top 50, a compilation by Spotify based on the most streamed songs of the previous week features homegrown independent artists, global pop stars and Bollywood artists. “Brown Munde”, a Punjabi song by AP Dhillon, has been a chart topper for nearly three months now. Alongside homegrown artist AP Dhillon is The Weeknd, an American pop artist who is currently #1 in the world based on the number of monthly Spotify listeners, and Bollywood playback singer Arijit Singh. But is this what India is listening to?

What’s surprising is that regional, independent artists like AP Dhillon are finding their place amongst global chart toppers on Spotify even though their exposure and reach do not usually match that of American pop artists or Bollywood singers. Spotify’s editorial playlists which are curated by music experts and genre specialists around the globe provide independent artists a chance to pitch their music to Spotify directly, giving music producers like AP Dhillon a fighting chance against the dominance of Bollywood or globally popular music. The chance to pitch music to Spotify Playlist Editors coupled with Spotify’s algorithms, which assess a listener’s taste and preferences to recommend AI generated playlists to them, gives independent artists a chance to feature in these recommendations. So it would not be surprising to see upcoming RnB/Trap artists like AP Dhillon in a recommended playlist with global sensations like Drake, Post Malone and The Weeknd because of the similarity in genre.

However, Spotify’s algorithmic mechanisms tend to create a deluding image of what is actually trending on the ground. According to a report on Spotify usage by LiveMint, 25-55 year olds in Gujarat are only listening to Bollywood Music, but users in Goa across ages only listen to international music. On Spotify India’s charts, these varying tastes and preferences get compiled into a single playlist, without accounting for regional outliers like Goa and Gujarat. At this point, it is important to examine the role of Spotify’s algorithm, called BART (Bandits for Recommendations as Treatments). 

 BART first analyses the language, lyrics and content of the song that listeners are tuning into. In the second stage, it detects the “vibe” or “mood” of a song and decides whether it’s upbeat, chill, heavy, minimal, instrumental, and so on as part of a mechanism to recommend new music that is similar to the listener’s tastes and preferences. Based on these results, Spotify’s AI technology will curate a playlist for listeners on a daily basis called “Daily Mix”. These algorithms have the power to create a listener’s own musical universe that is solely based on the user’s taste and preferences in music as detected by a software. For instance, if a listener shows interest in Bollywood singer Arijit Singh, then Spotify will recommend artists like Atif Aslam and Armaan Malik in the listener’s daily mix. Which is why unlike other popular Indian streaming platform charts like Gaana and JioSaavn, Spotify India charts tend to be a misleading assortment of musical choices, which are largely influenced by Spotify algorithms. Unless a listener is curating their own playlists without relying on Spotify’s recommendations, there is a low chance that listeners will move out of this musical bubble that they have been pushed into by Spotify.

External factors like Spotify’s market share in India and how listeners in India access their music are also crucial in determining whether we can rely on Spotify India charts to reflect what India is listening to. In the period between 2014-2020, India saw a massive drop in data prices from 270 INR to 11 INR, paving way for India’s digital revolution. Global service providers like Spotify, Amazon Music and YouTube Music have used this opportunity to penetrate the music streaming markets in India which were previously being dominated by Gaana, JioSaavn and Wynk Music. According to a report by INC42, as of September 2020, Spotify had amassed 42.1 million Monthly Active Users (MAU), overtaking Gaana which had 41.1m MAU. JioSaavn with 44.9m MAU was the market leader, followed by Wynk Music at 43.1m MAU. All these streaming platforms curate charts of their own, but they never seem to match. “Brown Munde” does not find itself on Gaana’s “Top Trending Hits”, or on JioSaavn’s “Trending Today” playlist. Even global hit songs like “Blinding Lights” by The Weeknd and “Senorita” by Shawn Mendes, which featured on “Spotify India Top 50”, don’t make an appearance on Gaana or JioSaavn’s chart toppers. Bollywood and regional film music are much more prominent on Gaana, JioSaavn and Wynk Music charts in comparison to Spotify. This indicates that consumers remain largely divided on which streaming platforms they prefer, based on the music they prefer to listen to. Most listeners who prefer Bollywood music, are more likely to use Gaana and JioSaavn, and the reasons for this could be multiple. For instance, these platforms might offer a better collection of Bollywood music as opposed to competitors, or the price of these platforms could influence consumer preferences as well. Spotify, being a new entrant, might not have penetrated the market to its full potential, or users who have been long time users of other apps prefer familiarity as all streaming platforms have different user interfaces which are hard to get accustomed to at first. 

It would be wrong to assume that Spotify’s charts are an accurate representation of what India is listening to. While this might be true to Spotify, the music streaming market in India is still growing and largely nuanced in terms of consumption. Spotify however is a special case that still needs examination because it is run by algorithms which are much more advanced than other streaming platforms. This is simply because the app recommends music based on multiple factors through BART, a luxury that is uncommon amongst other platforms. At this point of time, it can be speculated that different factors affect the way in which songs place themselves in the charts across platforms. In the future, even when all these streaming platforms reach complete market potential, Spotify India charts are still likely to differ in their charts from other service providers. For this, only the algorithm can be blamed.

Rohan Pai is a Politics, Philosophy and Economics major at Ashoka University. In his free time, you’ll find him singing for a band, producing music and video content.

We publish all articles under a Creative Commons Attribution-Noderivatives license. This means any news organisation, blog, website, newspaper or newsletter can republish our pieces for free, provided they attribute the original source (OpenAxis).

Categories
Issue 7

Taking from the Rich: Reddit, GameStop and the Consequences of Greed

Near the middle of 2019, a Reddit user, known as “Roaring Kitty” boasted his $53,000 investment in “GameStop” a declining video game company. GameStop bought and sold video games, and it isn’t hard to see why that kind of model seems unsustainable in the streaming and digital age. u/RoaringKitty made his post on a subReddit known as “r/WallStreetBets” henceforth known as WSB. Every commenter on WSB cried out that this investment was foolhardy, that GameStop was dying but u/RoaringKitty paid them no heed and continued to keep his investment there. Today, that $53,000 stake is worth $48 Million. How did this happen? 

To begin, we need to understand a few terms. 

What is a share? 

When a company is formed, it’s corpus consists of a set of discrete units. The owners of these discrete units are shareholders and become direct stakeholders invested in the company. In the case of GameStop, there are roughly 65 million shares up for grabs. 

What is a short? 

A short is a financial action one can take concerning shares. While the obvious way of profiting off of stocks is to buy some shares, wait for the prices to rise, sell and profit off of the differences, there is a means of profiting off of the fall in the price of a share. The way to do this is through “shorting”.

What one does is, when they anticipate that the price of a company’s shares is going to drop in value, they “borrow” shares from shareholders, sell them at current market prices, then once the price drops, they buy the shares back and “return” them, and keep the difference for themselves. Now, when one shorts a given company’s stock, it is legally required to eventually return the borrowed shares. This means they have to buy back the shares, regardless of what they cost. 

In the case of GameStop, hedge funds (financial institutions that profit through the buying and selling of stocks and shares) shorted 140% of GameStop’s shares. How do you short 40% more shares than those that exist? Well, that’s actually not too wild. Essentially, shares can be double-counted. Suppose I buy a share in GameStop and then lend it to a broker who intends to short it. This broker sells it to another customer, named say, Saman. Now, to Saman, this is just another share, there is no association with me, so she can further lend the share to someone else who could short it. This way, we can have over a 100% short interest. 

What did u/RoaringKitty do?

Now, u/RoaringKitty didn’t just brag about a weird investment, he noticed something nobody else did: GameStop wasn’t a dying company. GameStop had reasonably large cash reserves, they didn’t have much debt, and with the release of the new PlayStation 5 and Xbox Series, the chain of stores was doing alright. 

Roaring Kitty started talking about his investment on YouTube, Reddit, and TikTok, and people began to notice. Specifically, Michael Burry. Some of you might know him from Christian Bale’s portrayal of him in The Big Short, but for those who don’t, Burry was one of the first people to realize that there was a crisis imminent before the 2008 Economic Crisis and made a massive profit off of it. Burry, at last count, made a 1400% profit off of his investment in GameStop in just under 5 months. 

This discourse on GameStop’s financials, as well as public filings showing massive short interests from various hedge funds like Citron and Melvin Capital, became the seeds of a perfect storm. u/RoaringKitty mobilized r/WallStreetBets with the information that GameStop was viable fuelling thousands of members of the subReddit to buy millions of shares. This artificially drove the price of GameStop stock up hundreds of dollars and decimated the short position of various hedge funds. Melvin Capital lost nearly $4 billion throughout January. 

While initially, buying GameStop stock was sound financial advice, eventually anti-billionaire, anti-hedge fund rhetoric swept the subReddit, and users decided that keeping the stock was now a moral crusade to crush meddling Wall Street titans. You can find posts like this across the website describing their hatred for Wall Street money movers, and this no doubt fueled the stock buying. Eventually, various influencers, including Elon Musk joined the bandwagon, advocating to buy GameStop and crush the short sellers. Musk specifically dislikes shorting since firms have tried to short Tesla several times over the years. 

Robinhood, a free, fee-less trading platform began restricting trading GameStop stock, to avoid “volatility” in the stock market. Now, as surprising as it may sound, Alexandra Ocasio Cortez, Ted Cruz and Donald Trump Jr. all cried out that this was anti-competitive and anti-capitalist, you’d never expect to see the three of them agree on anything, let alone the free market. Robinhood was only the first of several services to restrict trading, an act that has led to several class-action lawsuits. This leaves a valuable question on the table, who gets to truly “regulate” the market? Why is social market manipulation “volatility” while a few billionaires doing it is a “hustle”? The actual nature of power within market structures has been exposed, and it cannot be allowed to fade from public memory. The “free” market is a selectively free market. 

Now, as trading continues it is to be seen which forces buckle first, the Redditors, or the hedge funds. As the value fluctuates, there are ripple effects across the industry. This entire incident is also provoking a series of questions about the power of social media. A user on Reddit mobilized millions of dollars through thousands of small traders, and apps like Parler managed to mobilize thousands to storm the US Capitol. While one shouldn’t conflate the two events, there needs to be cognizance of how these networks hold the power to organize people in ways that the people are not prepared for. But beyond that, the story is still unfolding, and we need to ask ourselves, who wins at the end of this? How do we even imagine “winning” in this scenario? And, where does this leave us? 

Vibhor is a third-year economics major, and frequent Redditor, with an interest in economic history, behavioural science and decentralised systems. He is a frequent critic of the free market and enjoys reading about market failure and similar shenanigans.