With musicians' album sales cut close enough to kiss this year ( in fact, only one artist hit the coveted one million sales needed to go platinum ), its little wonder many in the "biz" lament the impending doom of the music industry. But according to one musician, indie artists in particular have cause for concern: the advent of web streaming may just render them extinct.
The transition of Marc Ribot's self-described "free/punk/funk/experimental/psychedelic/post electronica" band, Ceramic Dog, into web streaming service Spotify netted a grand total of 112.80 euros in Europe and $47.12 in the US. Their album, "Your Turn," took a whopping $15,000 to produce.
You don't need to be a financial consultant to realize that this is over 14 grand shy of turning a profit. Now the question begs: did Ribot just catch a bad break, or does he represent the fate that will befall other indie artists?
Well, according to Ribot, it just might be both. "Now, maybe the market knows best, and the world is in fact better off without artists like me. I make no claims for my own work, but people need to understand what that means for the culture... If the type of music I make is no longer sustainable, you can kiss most jazz, classical, folk, experimental, and a whole lot of indie bands goodbye."
According to Ribot, while indie artists constitute 90 percent of working musicians, they represent only 38 percent of the total market share. Already representing an embattled economic front, their line of work is "just not sustainable" in the new digitized realm of streaming services.
My interest was originally piqued by this article because it proposed an unexpected consequence of the music streaming industry that I had never really stopped to contemplate. But upon further reflection, I can't say that I harbor the same doomsday sentiments as Ribot.
For one thing, the vast majority of musicians realize they cannot make a living based on their art alone. That still doesn't prevent many from doggedly pursuing their dreams, or even producing music as a fulfilling hobby. There will always be appreciative pockets of people who, irked by the homogeneity of the mainstream music selection, will seek refuge in jazz, folk, and indie genres.
In fact, Spotify, while probably not financially lucrative for musicians, provides another essential service - exposure. For many indie artists, this will be an opportunity to get their name out there and snag audiences across the world.
While it's no way to make a living, Spotify sure won't strike the indie genre dead. Rather than reduce musical subcultures to extinction, it might actually help to boost the exposure of little-know indie artists and revitalize the selection of music available to listeners.
Ribot, M. (2014, November 6). Is Streaming Good for Musicians? Retrieved December 4, 2014, from http://www.nytimes.com/roomfordebate/2014/11/06/is-streaming-good-for-musicians
Showing posts with label music industry. Show all posts
Showing posts with label music industry. Show all posts
Friday, December 5, 2014
Friday, November 28, 2014
Week One: Taylor Swift's latest feud is not with an ex-boyfriend
Ah, Taylor Swift. Country darling, pop princess, equal parts avowed feminist and hopeless romantic. Oh, and she may or may not have just single-handedly called into question the future of the music industry.
The 24 year-old singer's decision to pull all her songs from web streaming service Spotify underscores the tensions belying the new direction of digital media. Her argument contended that Spotify does not adequately appreciate the value of music as an art form nor its artists, and that people should be willing to pay for her songs.
Spotify is a web streaming service that allows its listeners to "spot" and "identify" (hence the name) new music and to share it with friends via a partnership with Facebook. Creating an account is completely free of charge, though upgrades cost up to $120 per year. Sounds too good to be true, right?
Well, for many artists, it is. Though Spotify claims 70 percent of its revenue goes to record labels (or roughly $1 billion), record labels receive less than a cent for each play. And most of the money funneled to record labels doesn't go to the artist, either.
Take Taylor Swift, for instance. Though Spotify CEO Daniel Ek claims she was set to garner over $6 million from the service this year, Swift said her total for 2013 clocked shy of $500,000. And that's not even the worst of it - pop singer Lady Gaga earned a measly $167 for one million plays of her song "Poker Face" during a five-month period.
So, who's in the right in the Great Swift vs. Spotify feud of 2014? Well, according to the co-chairmen of Rhapsody, a music-streaming service comparable to Spotify, the answer is Team Taylor.
"We think that Spotify’s apparent demand, that all its content be available in both their premium and free tiers, is overly simplistic and will not break the music industry’s decade-plus-long decline. Instead, we believe in a much more comprehensive approach that (a) differentiates between free services like Spotify and paid services like Rhapsody, and (b) is built on concepts like windowing and other ways to deliver value to both consumers and artists," said Jason Epstein and Rob Glaser in a joint statement.
They argue that the business model exemplified by Spotify is "throwing the baby out along with the bath water:" in other words, undervaluing the artist in an effort to make music more accessible to the masses. The solution, they say, is simple: make 90 percent of all new music available only on premium subscriptions or purchase so that artists don't get bamboozled out of their share.
Though their argument is sound (they liken their proposition to the fact that people will continue to go to the movie theater even though they're available on-demand and on TV at a later date), I tend to take a bit more of a cynical view on human nature. Right now Spotify, in my opinion, appeals to people because its free and less morally reprehensible than file-sharing or other illegal practices. But once listeners start to feel a financial squeeze, they will abandon their moral qualms and revert to aforementioned illegal activities, which will prove detrimental to both artists and online streaming sites.
As for right now, I applaud Taylor Swift for standing up to the duplicitous tactics of Spotify, which is clearly not giving artists their money's worth. Little does Spotify know that it has made a formidable opponent, and that it won't be easy to "Shake It Off."
Citation:
Epstein, J., & Glaser, R. (n.d.). Essay: Why Streaming (Done Right) Will Save the Music Business. Retrieved November 29, 2014, from http://www.billboard.com/biz/articles/news/digital-and-mobile/6327433/essay-why-streaming-done-right-will-save-the-music
The 24 year-old singer's decision to pull all her songs from web streaming service Spotify underscores the tensions belying the new direction of digital media. Her argument contended that Spotify does not adequately appreciate the value of music as an art form nor its artists, and that people should be willing to pay for her songs.
Spotify is a web streaming service that allows its listeners to "spot" and "identify" (hence the name) new music and to share it with friends via a partnership with Facebook. Creating an account is completely free of charge, though upgrades cost up to $120 per year. Sounds too good to be true, right?
Well, for many artists, it is. Though Spotify claims 70 percent of its revenue goes to record labels (or roughly $1 billion), record labels receive less than a cent for each play. And most of the money funneled to record labels doesn't go to the artist, either.
Take Taylor Swift, for instance. Though Spotify CEO Daniel Ek claims she was set to garner over $6 million from the service this year, Swift said her total for 2013 clocked shy of $500,000. And that's not even the worst of it - pop singer Lady Gaga earned a measly $167 for one million plays of her song "Poker Face" during a five-month period.
So, who's in the right in the Great Swift vs. Spotify feud of 2014? Well, according to the co-chairmen of Rhapsody, a music-streaming service comparable to Spotify, the answer is Team Taylor.
"We think that Spotify’s apparent demand, that all its content be available in both their premium and free tiers, is overly simplistic and will not break the music industry’s decade-plus-long decline. Instead, we believe in a much more comprehensive approach that (a) differentiates between free services like Spotify and paid services like Rhapsody, and (b) is built on concepts like windowing and other ways to deliver value to both consumers and artists," said Jason Epstein and Rob Glaser in a joint statement.
They argue that the business model exemplified by Spotify is "throwing the baby out along with the bath water:" in other words, undervaluing the artist in an effort to make music more accessible to the masses. The solution, they say, is simple: make 90 percent of all new music available only on premium subscriptions or purchase so that artists don't get bamboozled out of their share.
Though their argument is sound (they liken their proposition to the fact that people will continue to go to the movie theater even though they're available on-demand and on TV at a later date), I tend to take a bit more of a cynical view on human nature. Right now Spotify, in my opinion, appeals to people because its free and less morally reprehensible than file-sharing or other illegal practices. But once listeners start to feel a financial squeeze, they will abandon their moral qualms and revert to aforementioned illegal activities, which will prove detrimental to both artists and online streaming sites.
As for right now, I applaud Taylor Swift for standing up to the duplicitous tactics of Spotify, which is clearly not giving artists their money's worth. Little does Spotify know that it has made a formidable opponent, and that it won't be easy to "Shake It Off."
Citation:
Epstein, J., & Glaser, R. (n.d.). Essay: Why Streaming (Done Right) Will Save the Music Business. Retrieved November 29, 2014, from http://www.billboard.com/biz/articles/news/digital-and-mobile/6327433/essay-why-streaming-done-right-will-save-the-music
Week One: Don Draper needs to marry Britney Spears in order to save the music industry
Like it or not, the advent of the digital age has transformed the media landscape into a skyline of new possibilities - and the none-too-gradual demise of others. It seems as though every industry is teetering on the brink of apocalyptic change: print is dead, radio is on its last throes, traditional television is heaving its final breaths.
Unsurprisingly, the music industry is not exempt from these grim predictions of doomsday. The sale of CDs and MP3 files has flown swiftly south over the past decade, more than halving from 730 million units sold in 2000 to the 326 million (including digitally downloaded albums) sold in 2010. This year also proved devastating for industrial titan Apple as iTunes downloaded music sales plunged 40 percent. What gives? Well, illegal file-sharing is a viable culprit. But perhaps a more formidable foe for the music industry is the advent of online radio - Pandora, Spotify, and other non-broadcast radio - who are luring listeners to their service at the expense of other music platforms. Just last year almost 150 million people tuned in to internet radio, and another 20 million listeners are expected by the end of next year.
According to Paul Goldstein, an audience development executive, these IP-based radios are "fueling an important growth category for the music industry." This growth derives from the big bucks that is brought in by two main sources: subscriptions to the radio and advertising. However, its become apparent that the latter is so much more lucrative than the former; eighty-eight percent of Pandora's revenue is from advertising.
"If artists and labels go on the offensive, fully embracing streaming services (who help replace diminishing MP3 and CD revenue), and also innovate by developing audiences themselves through their own branded offerings, they will exert far more control over two critical assets that advertisers want: Large audiences and big data," said Goldstein.
The main take-away I get from this digital revolution is that music is not really what's for sale in its future industry: it's the listeners. Rather than depending on CD and MP3 sales in the future, labels will have to start reeling in revenue from another source or risk a future every bit as bleak as the forecasts say. By catering an audience to advertisers, the music industry can save its skin from a sorry fate at the hands of declining CD sales.
I'm very curious to see how the industry will rebrand themselves to monetize off its listeners. It seems like a match made in heaven - both music and advertising heavily rely on attention, and maximizing the overlap within these two industries promises to yield sizeable profits for both. I always thought of the music industry in the glitzy trappings of a pop star and the advertising agencies as a cerebral, calculating Mad Men-esque business exec. Britney Spears, meet Don Draper. Now get married. It's the only thing that'll save the music industry.
Citation:
Goldstein, P. (2014, April 24). The Future of the Music Industry: Selling Audiences to Advertisers. Retrieved November 28, 2014, from http://recode.net/2014/04/24/the-future-of-the-music-industry-selling-audiences-to-advertisers/
Unsurprisingly, the music industry is not exempt from these grim predictions of doomsday. The sale of CDs and MP3 files has flown swiftly south over the past decade, more than halving from 730 million units sold in 2000 to the 326 million (including digitally downloaded albums) sold in 2010. This year also proved devastating for industrial titan Apple as iTunes downloaded music sales plunged 40 percent. What gives? Well, illegal file-sharing is a viable culprit. But perhaps a more formidable foe for the music industry is the advent of online radio - Pandora, Spotify, and other non-broadcast radio - who are luring listeners to their service at the expense of other music platforms. Just last year almost 150 million people tuned in to internet radio, and another 20 million listeners are expected by the end of next year.
According to Paul Goldstein, an audience development executive, these IP-based radios are "fueling an important growth category for the music industry." This growth derives from the big bucks that is brought in by two main sources: subscriptions to the radio and advertising. However, its become apparent that the latter is so much more lucrative than the former; eighty-eight percent of Pandora's revenue is from advertising.
"If artists and labels go on the offensive, fully embracing streaming services (who help replace diminishing MP3 and CD revenue), and also innovate by developing audiences themselves through their own branded offerings, they will exert far more control over two critical assets that advertisers want: Large audiences and big data," said Goldstein.
The main take-away I get from this digital revolution is that music is not really what's for sale in its future industry: it's the listeners. Rather than depending on CD and MP3 sales in the future, labels will have to start reeling in revenue from another source or risk a future every bit as bleak as the forecasts say. By catering an audience to advertisers, the music industry can save its skin from a sorry fate at the hands of declining CD sales.
I'm very curious to see how the industry will rebrand themselves to monetize off its listeners. It seems like a match made in heaven - both music and advertising heavily rely on attention, and maximizing the overlap within these two industries promises to yield sizeable profits for both. I always thought of the music industry in the glitzy trappings of a pop star and the advertising agencies as a cerebral, calculating Mad Men-esque business exec. Britney Spears, meet Don Draper. Now get married. It's the only thing that'll save the music industry.
Citation:
Goldstein, P. (2014, April 24). The Future of the Music Industry: Selling Audiences to Advertisers. Retrieved November 28, 2014, from http://recode.net/2014/04/24/the-future-of-the-music-industry-selling-audiences-to-advertisers/
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