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After years of decline, digital streaming is saving the music industry

Peter Nowak | posted Tuesday, Apr 4th, 2017

Streaming is turning out to be a bonanza for the music industry, if the latest numbers from the Recording Industry Association of America are to believed.

Total U.S. retail sales hit $7.7 billion (U.S.) in 2016, representing 11.4% year-over-year growth – the largest single-year gain for the industry in almost two decades. The majority of that growth came from streaming services such as Spotify and Apple Music, which now provide more than 50% of the industry’s revenue.

Music streaming overall, including free services, saw 68% growth last year compared with the year before. Subscription services did even better, with revenue improving by 114% to $2.5 billion.

The results go a long way to fulfilling the promise that the likes of Spotify have been making for years – that, given enough time and scale, streaming can be even more lucrative to the music industry than their previous distribution systems.

Anecdotally, when I think of my own music purchasing habits in the past and present, I can see how this makes total sense.

Prior to the Napster revolution many years ago, when I was a young lad who was very much into music, I’d buy a handful of CDs a year. Maybe four or five, which might run to $60 a year.

File-sharing came along and offered up anything and everything anyone could want, so forget about buying discs. But there were problems with the free music revolution, and no, we’re not talking about the legality. No one really cared about that.

The issue with Napster and then BitTorrent after it was that you still had to proactively download what you wanted. It took work.

Spotify and its kin now deliver a simple proposition – the same, virtually unlimited choice, pretty much wherever and whenever you want it, but for a relatively low fee.

They’ve taken the work out, so no wonder so many people are signing up. Spotify alone has 50 million paying customers, while Apple Music reports 20 million.

The kicker in my situation, and probably for many people, is that I’m actually paying more for music now than I ever did. At $10 a month, Spotify is costing me $120 a year, easily double what I spent even in my heyday of music consumption.

The difference, of course, is that we’re getting far more in exchange. The success of streaming services thus comes down to a few basic factors that were simply missing from the business in years past: convenience and value for money, which is evidently succeeding. What a novel development.

Wearable technology was supposed to be the next big thing. What happened?

Peter Nowak | posted Monday, Mar 27th, 2017

It looks like the rumours of wearables’ demise have been premature. Or at least that’s the case according to the latest figures from analysis firm IDC.

Total global wearable shipments in the fourth quarter of 2016 were 33.9 million units, up 16 per cent from 29 million units a year earlier. Judging by those numbers, you might say there’s life in wearables yet.

A closer look at the numbers suggests there’s some truth to that conclusion, but that the market is also changing considerably.

To start with, it looks like Fitbit—the market leader—is in free fall. The company accounted for 19 per cent of all wearables shipped in the quarter, down a full 10 per cent from a year earlier.

China’s Xiaomi picked up much of that slack, placing second with 15 per cent of the market, up from 9 per cent in 2015. Apple was third with 4.6 per cent, up slightly from 4.6 per cent.

Garmin and Samsung rounded out the top five, each with low-single digit market shares.

“Others” also saw decent growth, going to 13 per cent from 10 per cent.

This group includes newcomers such as Fossil, BBK and Li-Ning, which variously make child-monitoring and step-counting shoes, as well as “hearables” companies such as Doppler Labs.

Taken together, there are a few conclusions that can be arrived at. First, Xiaomi’s powering ahead suggests there’s a lot of demand for traditional wearables in China.

Fitbit’s decline, meanwhile, indicates that the market for traditional step-counting devices is fizzling, which is probably where the wearables-are-dead narrative comes from.

The growth of the “others” category could also mean interest is increasing in wearables that do different things.

Hearables in particular, while only accounting for about 1 per cent of the market so far according to IDC, are promising.

Rather than just telling users what they already subconsciously may know—that they’ve walked a lot in a given day—such devices offer up new capabilities, like enhanced hearing.

Wearables might therefore be dead, but only in the way we’ve known them so far.

Millennials aren’t coddled—they just reject abuse as a management tactic

Deborah Aarts | posted Thursday, Feb 23rd, 2017

Recently, the University of British Columbia’s faculty of medicine circulated a video meant to make its instructors aware of “student mistreatment.” With a minor-chord piano medley providing the soundtrack, viewers were asked to avoid putting students on the spot with questions, to minimize “cold and clinical” interactions, and to cultivate “safe” learning environments for the young residents.

It seems a little like something created by The Onion, but the video was sincere, and its message will be familiar to a lot of employers dealing with people in their 20s. For many who remember what business was like pre-Internet, millennials seem an appallingly sensitive lot, having been protected from the vagaries of the world by helicopter parents, trigger warnings and—to especially cynical critics—sheer narcissism. “Aren’t young people coddled?” is now as safe an icebreaker as, “Did you see last night’s Seinfeld?” would have been 20 years ago.

It’s a stereotypical view and, of course, an incomplete one. But there’s no doubt younger workers are changing the interpersonal dynamics of the modern workplace, much as they’ve already done in high schools and universities. And I have news for you, my fellow judgmental old people: That’s a good thing.

For decades—centuries—the archetype of the successful business person has been the sneering blowhard, unafraid to bark orders and excoriate the work of underlings. He (let’s be honest, it’s traditionally a he) leads with a charming mix of ego, hair-trigger temper and intimidation. The fictional Gordon Gekko is the poster boy, but real-world examples abound: Rupert Murdoch, Anna Wintour, Larry Ellison, Kevin O’Leary, Donald Trump. Steve Jobs, brilliant as he was, was an often vicious and tyrannical boss.

The influence of such titans has created the expectation that to be successful in business, one must be able to be, for lack of a better term, mean. Or, at least, one must be prepared to act that way. For decades, otherwise mild-mannered and amiable individuals have had to train themselves to behave differently at work: to be harder, colder, less polite. (You can actually take courses on this kind of thing.) In some workplaces, making a colleague cry is considered a sadistic rite of passage. In the culture of commerce, behaviour that would be inexcusable in pretty much any other context is not only tolerated, but rewarded.

To what end? What real benefits are conferred on a business when its leaders are nasty? Abusive behaviour sure doesn’t spur productivity: A 2006 Florida State University study of 700 employees in a variety of different roles found that those with abusive bosses were five times more likely to purposefully slow down or make errors than their peers, and nearly six times more likely to call in sick when they actually felt fine. Nor does it do much for employee morale: As Stanford organizational behaviour professor Robert Sutton wrote in his 2007 bestseller, The No Asshole Rule, brutish managers “infuriate, demean and damage their peers, superiors, underlings and, at times, clients and customers, too.”

The most progressive bosses today—the ones whose behaviour will be tomorrow’s status quo—are demanding without being discouraging, honest without being rude and confident without being cocky. There has been plenty of important research on each of these management qualities, such as Mark Murphy’s book Hundred Percenters on motivating employees to greatness; or ex-Googler Kim Scott’s “radical candour” approach to providing feedback; or the work of Brené Brown, whose landmark 2010 TED talk is called “The Power of Vulnerability.” Caring about people’s feelings doesn’t make managers airy-fairy pushovers; rather, such leaders recognize their job is to help people excel. And they produce exceptional results not in spite of their compassion and kindness, but because of it.

Yes, it can be irritating to hear our younger colleagues complain of hurt feelings. But millennials aren’t wrong to expect a kinder, gentler work environment. The rest of us are wrong for clinging to the useless and outdated notion that to thrive in business, you have to be an asshole.

Uber’s latest crisis raises a key question: who does HR really work for?

Deborah Aarts | posted Wednesday, Feb 22nd, 2017

On Sunday, engineer Susan Fowler published a blog post detailing what she diplomatically dubbed her “strange” year working at Uber—a tenure that she says included, among other things, a) her manager propositioning her on her first day at work; and b) her repeated complaints about the incident ignored and dismissed by the company’s human resources department, under the aegis of not sullying the guy’s career for an “innocent mistake.”

The post spread quickly, enraging many high-profile commenters. The actress, author and new-media observer Felicia Day (2.94 million Twitter followers) dubbed Uber’s behaviour “Gross. Gross gross gross.” Uber backer and angel investor extraordinaire Jason Calacanis (284,000 Twitter followers) called it “obviously not acceptable.” And the public was ready to pounce: Just 24 hours after Fowler published her post, the Twitter hashtag #DeleteUber had generated almost 5 million more impressions than it did during the weekend of January 27, when masses of people started using it to protest the company’s response to a New York taxi strike and CEO Travis Kalanick’s (soon to be short-lived) participation in President Donald Trump’s tech advisory committee.

For his part, Travis Kalanick responded by calling the actions Fowler described as “abhorrent & against everything we believe in,” adding that any Uber employee condoning such behaviour would be fired. Kalanick went on to commission an “urgent” investigation into the allegations, to be headed by former U.S. attorney general Eric Holder and including, among others, Uber board member Arianna Huffington and the company’s chief HR officer Liane Hornsey (who has only been on the job for a few months).

Fowler’s account depicts an HR department that failed—by will, or ignorance, or both—to act in the interest of employees (yes, plural: Fowler writes that she has learned her experience was not unique). The investigation is a good first step, but it will take more than that to correct the egregious flaw at the core of the issue.

As has been pointed out by several observers of Fowler’s claims over the past few days (to the genuine surprise of many) an HR department’s primary allegiance is to the company, not to its workers. Ruth Cornish, an HR consultant, told The Guardian in 2011 that HR departments are “purely there” to protect the interests of senior management. “I have seen cases where HR staff, deemed to be too employee-focused, are actually got rid of. I’ve been in HR for most of my career and while we were very much there to help initially, that has evolved to the other extreme.” Fellow industry veteran Shannon Ford told researchers at job-search website CareerBliss—a company whose surveys have revealed that only 7% of employees trust HR—“HR’s responsibility is to the company. I have been both an adversary and an advocate for the employees, but it is always for the good of the company.”

There are plenty of good HR departments that ably serve both mandates. But that’s a tricky balance to strike, requiring a skilled, nuanced approach that is very easy to abandon when a company is in as aggressive a growth mode as Uber has been. When an organization’s culture centres around unusually high expectations for performance at a blistering pace (like, say, a ride-sharing platform endeavouring to be the last player standing in a fiercely competitive new niche) a Machiavellian “the ends justify the means” stink can pervade even those departments meant to keep things in balance.

The HR reps at Uber likely thought they were acting in the best interest of the organization. Why? Because Fowler’s complaints were about an individual who had been delivering great work. It’s yet another example of companies excusing or overlooking bad behaviour when it’s done by star performers—a too-pervasive phenomenon that we Canadians will remember from the CBC’s inaction on complaints against disgraced radio host Jian Ghomeshi.

The irony, of course, is that this type of justification doesn’t protect the employer at all, in the end. Uber is now facing a massive PR crisis, an even more massive consumer backlash and—perhaps most worryingly, for its long-term viability—an increasingly entrenched reputation as a lousy place to work. (Remember: the company is headquartered in San Francisco, where the search for tech talent is like The Hunger Games.) Let this be a lesson to HR departments everywhere (and the executives to which they report): the company does not win when bad behaviour is brushed off. Nobody does.

Being hooked on debt has long-term consequences

Romana King | posted Friday, May 27th, 2016

Hooked on debt. It’s an apt description for the rising debt-to-income levels currently seen in Canada and a new survey by Manulife Bank highlights there’s a high price to our debt dependency—a cost that goes far beyond the low interest rates you see posted online.

Impact on those approaching retirement

One of the biggest contributors to our increased debt-load are rising housing costs. These increased shelter costs make it far more difficult for homeowners to balance paying down their mortgage, while saving for retirement and managing day-to-day expenses, explains Rick Lunny, president and CEO of Manulife Bank of Canada.

According to the new Manulife Bank Canada survey, 37% of homeowners were “caught short” at least once in the past year—meaning they didn’t have enough money to cover their expenses. Worse, only 40% of Canadians are confident that they are saving enough for retirement. “For many, not saving enough means relying on their home equity as a significant portion of their retirement package,” says Lunny.

According to the new Manulife Bank Canada survey, more than a quarter of homeowners predict their home equity will comprise 80% or more of their household wealth at the time they retire—and almost a quarter of those surveyed were already in their fifties. This information is supported by numbers from Statistics Canada information, which shows half of Canadian homeowners aged 50 to 59 still have mortgage debt, though that number drops to 25% between ages 60 to 69.

Screen Shot 2016-05-20 at 3.12.13 PM

“Our research has consistently found that becoming debt-free is among the top financial priorities for Canadian homeowners, says Lunny. But with stretched budgets and rising housing costs, these homeowners must find a balance between debt repayment and saving for retirement. “So they don’t end up house-rich and asset poor,” says Lunny.

Why? Because increased debt means some potentially difficult decisions, says Lunny. Those with significant equity in their home and insufficient retirement funds could opt to: retire later than originally planned, accept a lower standard of living in retirement, downsize to a less expensive home, or borrow against their home equity to pay bills and fund their retirement.

Impact on homeowners

Appreciating home values may explain why some Canadians aren’t able to weather major expenses. The housing market has been a major driver of economic growth across the country in the last decade and this nurtured consumer confidence in taking on household debt. But this appears to be coming at the expense of retirement savings and even debt repayment.

According to the Manulife Bank survey, 11% of Canadians reduced the amount they saved (mainly because of the recent weaker loonie), while 7% reduced their debt repayments.

Yet, to plan for retirement, most financial planners suggest saving a nest egg large enough to provide you 70% of your pre-retirement income during your retirement years. But this classic advice assumes that other expenses, such as a mortgage, are already paid off.

That might be hard if Canadians not only stop saving for retirement but neglect to pay off their mortgage and other debts.

According to Manulife Bank, the average mortgage amount held by a Canadian homeowner is $181,000, up from $175,000 reported last fall. Yet regional differences in housing costs show that average mortgage debt differs across the country. In Vancouver, homeowners have average of mortgage debt of $259,000, compared to $217,000 for Calgary and Edmonton homeowners and, surprisingly, $194,000 for Toronto homeowners.

Average mortgage debt

“When you look at why people struggle to make a mortgage payment it almost always comes down to income. It could be a loss of a job, a pregnancy leave, a temporary disability or illness, but whatever the reason, people need to develop a budget and a spending plan that enables them to plan for periods with a reduced income,” says Lunny.

“The best option is to work with an advisor to get a plan in place well before retirement to balance debt repayment, retirement savings and day-to-day spending,” says Lunny.


Canada’s Richest Neighbourhoods 2014: The Top 25 Wealthiest Neighbourhoods in Canada

Canadian Business | posted Thursday, Jul 24th, 2014


Canadian Business magazine partnered with market research firm Environics Analytics to map out out exactly where Canada’s wealthiest people live. Unsurprisingly, they flock together, choosing leafy enclaves where they can spread out to make room for wine cellars, art collections, luxury cars and more.

Click or tap through the gallery to see where Canada’s wealthiest people call home »