It seems to me that there are three main forces at work:
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Over time, you are exposed to more music and can thus learn to appreciate the nuances and parse the sound of that which you previously had no taste for.
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However, being exposed to more music also means you eventually find higher quality stuff, which can raise your standards and make you look back at past favorites and see the flaws therein. It may not go all the way to becoming crap in your eyes, but just mediocre.
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Also, I guess other times you may just move on and lose the resonance of certain kinds of music; for example, a hardcore punk rocker may lose his anger and rebelliousness and not really feel that type of music anymore.
For me, I think the first force is dominant. I started out with only classical music and a smattering of pop in my life, as my parents imparted nothing but the lovely gift of a piano teacher, who was a classical afficionado. Music was not at all a topic with friends, but I was exposed to the occasional pop stuff via TV, movies, random school events, the bus, etc. For example, MC Hammer was really big in late elementary school, but I never really got into it.
In high school, I got my first significant exposure to pop/rock, and my palette finally opened up it, including stuff from the Red Hot Chili Peppers to Sarah McLachlan to Billy Joel. Even by the end of high school, I still could not stand anything “hard”, and that included stuff like Led Zeppelin and the Smashing Pumpkins (who I enjoy now, btw), rap, or even jazz, which mystified me more than anything (tho I did enjoy some jazz standards like In The Mood and Sing Sing Sing).
In college freshmen year, I was lucky enough to be in a hall full of music freaks, and I was really uncomfortable at first at the music-noise I was hearing. Just loud abrasive stuff from the Sex Pistols to old-school Metallica to My Bloody Valentine to Radiohead. It was an out-and-out assault at my ears, and it just sounded so loud and noisy. But bit by bit, as if I was learning a language, I started parsing out the sound. I started hearing the progression of noise in My Bloody Valentine, I started hearing the guitar riffs in Metallica, I started sorting out the noises in Radiohead. This was a process that took a couple of years, but I began liking that stuff. Some friends were into the Philly jazz scene, and I couldn’t help but get into it as well. It seemed like everything from Bob Dylan to Green Day to Johnny Cash to Enya to Louis Armstrong was entering into my system. Rap, techno/trance/etc, and country were still not my thing.
Post college, I have even found some rap that I like, and I think country may get there if I make an effort. That would leave techno and friends as the only whole genre that I dislike. It’s not to say that I like everything but techno, but that I can appreciate and have found things I enjoy listening to and would put on even home alone.
And the funny thing is, even though I’ve been accumulating a ton of new tastes over time, I still like most of what I liked in high school. I still like Billy Joel and Sarah Mclachlan and heck, even Jewel (well, her first album, anyway). Even though Death Cab for Cutie has risen very high in my estimation as one of the ideal pop bands, I still enjoy those Gin Blossoms and Counting Crows. Even though I find myself now liking punky Operation Ivy, super-sappy Richard Marx still finds time on my playlist.
However, I’ve noticed that some of my high school friends have evolved to the point where they can’t stand their former loves. Billy Joel, who used to be OK, has now become crap. Puff Daddy, who used to be “da shiz”, is now “tired old shiz”. And so on. A couple seem to love a fairly narrow band of stuff and are quite dismissive of everything else.
Despite these folks, I think that most people’s tastes enjoy a net expansion over time. Am I right?