Spotify as a simple case study in making something people want

A passage in the New Yorker long form piece this week on Spotify really illuminates the key parts of what we spend a lot of time trying to help founders create: Something people want. 

Problem: Piracy was how people did it at the time. 

“It came back to me constantly that Napster was such an amazing consumer experience, and I wanted to see if it could be a viable business,” Ek went on. “We said, ‘The problem with the music industry is piracy. Great consumer product, not a great business model. But you can’t beat technology. Technology always wins. But what if you can make a better product than piracy?’ ” Ek continued, “Piracy was kind of hard. It took a few minutes to download a song, it was kind of cumbersome, you had to worry about viruses. It’s not like people want to be pirates. They just want a great experience. So we started sketching what that would look like.”

They started with a simple problem statement. All of the great era-defining startups seem to start that way. What was broken? They knew exactly what was broken. 

Solution: 200 milliseconds

Their “product vision,” in tech parlance, was that the service had to give the impression that the music was already on your hard drive. “What would it feellike?” Ek asked. “That was the emotion we were trying to invoke.” The key was to build something that worked instantly. Streaming, whether audio or video, tends to have built-in delays while you wait for the file, which is stored on a server in the cloud. But if the music starts in two hundred milliseconds or less—about half the time it takes, on average, to blink—people don’t seem to perceive a delay. That became Ek’s design standard. He told his lead engineer, Ludvig Strigeus, a brilliant programmer he had worked with before, “I don’t accept anything that isn’t below two hundred milliseconds.”

What would solve that very direct problem? Well, a great streaming service that was superior in a specific way. They knew how to measure success. Clearly if you could make a streaming service act as if it were on your local hard drive, you could win. 

Hard-to-build proprietary technology — the first time it was done, just enough of an advantage

Strigeus responded, “It can’t be done. The Internet isn’t built like that.”

“You have to figure it out,” Ek insisted.

The solution involved designing a streaming protocol that worked faster than the standard one, as well as building their own peer-to-peer network, a decentralized architecture in which all the computers on it can communicate with one another. In four months, they had a working prototype.

“And I knew when we had it that it was going to be very special,” Ek said.

This is a signature piece of why Spotify was special early on. There are two parts to this. The first is could it be done? Until these early prototypes, it hadn't. The second part is can it be cloned? As with almost anything software related — yes. Novel tech is not an infinite defense, but it was enough of one for Spotify to get off the ground. You don't need a technological advantage that lasts forever (though of course that'd be preferable) — just one that will last enough such that your competitors can only copy your innovation from 6 months ago. It can take that long to fast follow, which is enough to keep your unoriginal would-be competitors at bay while you blaze ahead. 

The Schlep = The Moat

Ek’s original idea was to launch Spotify in the U.S. at the same time that he launched the service in Europe. Ken Parks, Spotify’s chief content officer, said, “Daniel thought he could just go down to the corner store in Stockholm and pick up a global license.” He didn’t realize that he would have to negotiate directly with all the different copyright holders, a herculean task. Not surprisingly, the labels weren’t interested. Ek was an outsider—a techie, and a Swedish one at that. Parks, an attorney who’d worked at E.M.I., recalled, “We needed to overcome the music-is-free mentality that Spotify represented.” Of the labels’ attitude, he went on, “If you have something you’ve invested a ton of money in, and you’ve been selling it for a lot, and you feel raped by piracy—to say to that person, ‘The only way to beat this is to co-opt the people who are stealing from you,’ that was a challenge.” Ek said, “If anyone had told me going into this that it would be three years of crashing my head against the wall, I wouldn’t have done it.”

This is a common refrain. If founders knew how much work these things would be, often they wouldn't do it. But they do, and that's protectable long term enterprise value. 

This analysis is of course with 20/20 hindsight. In the moment, Ek and the Spotify cofounders and investors had no idea they'd be right. But they figured they might be, so they built it. 

Why Flow, a new low cost super high precision controller, is important for designers and creatives

Flow is launching this morning. They're YC alums who have created a low cost, high precision wireless controller in the form of a dial. It's highly programmable and most designers and creatives will find this to be super valuable because that's where precision really matters.

When I'm in Photoshop making pixel-perfect mockups, or when I'm in Lightroom editing photos, I'm constantly making micro-adjustments on specific settings, whether it be brush size, exposure, etc. I have to acquire the target, then move my mouse, and then click-drag to the point where I'm happy. We're exercising one fundamental law of UX over and over again - Fitts' law. 

Fitts' Law states that the difficulty of an action is determined by the movement time needed to complete that action, which is in turn defined by the size of the target to be acquired. Sliders are by nature long and thin. If I had to guess, a good chunk of the cognitive load of doing creative work is just moving a mouse pointer to a tiny slider bar.

Not only is it a tiny target to acquire, but there are finite number of steps in those sliders that can make a mountain of difference. For instance, photographers are always looking for that absolutely perfect exposure or temperature. With a slider, you're limited to the number of pixels that slider has on screen - 200px? That's only 200 gradations, and in my experience that perfect level is always in between two of those notches. 

Enter Flow. There are over 3600 distinct values in one full 360 degree turn of the device. And since you can link them directly to specific values e.g. exposure or brush size, you don't have to acquire the target over and over and over again. 

That's why I bought one, and that's why Flow is an important programmable hardware device that creative people should keep an eye on. They're accepting preorders now and are on Product Hunt, and if you get one early it's an extra good deal. 

Silicon Valley's Congressional Hope: Time to sweep away a congressman "who mostly votes the right way"

Silicon Valley hasn't had a real voice in Congress before. We've got a shot at one now though. In about 20 days, voters will go to the polls in a race for a congressional seat for the 17th district, and democrat Ro Khanna has a fighting shot at toppling incumbent Mike Honda. The polls are running in a dead heat, so this is one you should care about. 

There's nothing wrong with Honda — he's an old-line Democrat. Except that's actually the problem. He hasn't done much in the way of defending the things we really care about: Immigration reform, free Internet rights, supporting entrepreneurship, and reforming education. If Silicon Valley can elect Ro, then we as citizens are making a statement that business as usual for the Democratic party just isn't going to fly. 

That's why the San Jose Mercury News has endorsed Ro Khanna as well, saying "Silicon Valley -- whose economy, like the 17th District, stretches into the East Bay -- needs more than a congressman who mostly votes the right way... Silicon Valley's other representatives, Congresswomen Anna Eshoo, D-Palo Alto, and Zoe Lofgren, D-San Jose, are older than 65, and both are invaluable voices in Washington -- respected leaders on valley issues as well as defenders of progressive values. When they meet with us, they are insightful; we always learn something. This is not the case with Honda."

Ro is one of us. He's committed to reforming immigration so our talented friends who happened to be born elsewhere can still come here to create new businesses and jobs. Startups die every other day because of our antiquated and special-interest-ridden immigration policies. He's on our side when it comes to SOPA, PIPA, net neutrality and a maintaining a free and open Internet. 

If you're in the 17th District (Fremont to Sunnyvale), you have a chance to make history. Register to vote, and consider Ro Khanna for Congress. This race matters, and it's looking like a few hundred votes will swing this one way or another. 

Listen to the people for whom you're building: A low income housing development that chose bath tubs over hot water

I was watching an urban planning documentary called Urbanized on Netflix recently. It brought up a fascinating example of participatory design in the context of building homes. A housing development in Santiago, Chile called Elemental ran into a problem. The builders had to make a tough decision: should they build in hot water heaters, or should they build in bath tubs? The budget could only support one or the other at the outset.

A typical top-down approach would dictate that of course you'd want hot water. A first world view of the situation would say that you'd rather shower standing up with hot water than sit in a bathtub and have to heat water separately. 

Yet that's the exact opposite of what future residents of Elemental actually wanted. Architect Alejandro Aravena went out into communities and talked with residents and discovered what typical bureaucrats would never find - that people moving to the low income housing from slums would unanimously choose bathtubs instead. Hot water heaters and gas furnaces cost money, and are unfamiliar. Bathtubs, on the other hand, were very familiar (in fact what residents typically did in their existing living environments due to the extra privacy) and didn't generate additional energy cost. 

Further, hot water was one of the things that people typically added later, once they had acclimatized to the new living environment and improved their station in life. 

It seemed to me this was the sort of thing you could only tell by actually talking with the people who would use your creations. It is the ideal situation for us to create things for ourselves. But when you aren't doing that, you have to be extra careful about the assumptions and values you bring to the table. 

Always-on video recording will prevent tomorrow's Missouri police state — light is a disinfectant

The ongoing Missouri police fiasco has prompted a lot of discussion about the need for police transparency. My friend Jeff Lonsdale writes:

Active duty police officers need to be automatically recording everything they do. With recordings, incidents such as those happening in Ferguson can be quickly resolved one way or another. When tested in Rialto, California, recording reduced both complaints filed against police officers and the incidents where use of force was required. There will still be cases where police officers use excessive force in murky situations but by and large transparancy via recorded police and citizen interactions should protect the innocent parties, see more guilty parties punished and cause better behavior all around.

Smartphones, wearables, and always-on high bandwidth connectivity is converging in the next ten years to make this happen, not just for police officers, but for private citizens too. 

Always-on video is already shining light in Russia with the omnipresence of on-dash cameras. They say light is the best disinfectant, and that's exactly what video can be in the future. It's time to build.