How streaming could be good for artists

With a few tweaks, we can keep the music flowing for listeners, while paying the creators fairly.

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I published this over at Medium.com and thought I would share with my readers.

Streaming music services introduce people to new music, and that is a great thing. Music is being heard, enjoyed and shared. You can now pay $10 to listen to all the songs you want, even offline. What a deal! But wait — this is where things have to change. The idea that you can get as much as you want for a single charge is very short sighted and does not feed into a long term sustainable model of operation.

I’m a musician/songwriter who has released five albums over the last seven years (KASHKA, Forest City Lovers). I’m very familiar with the music industry, and the way things are rapidly changing. There have been many discussions amongst my peers and contemporaries about the state of the industry now. It’s a whole new beast and the old rules, even from three years ago, are gone. The masses aren’t buying CDs, they’re streaming. This means less direct revenue is being earned from the same amount of time and money invested to create the music. There’s been movement from some individuals to remove all their content from streaming sites such as Rdio and Spotify, while many more others feel trapped in the current system by the perpetual dangling carrot of “exposure”.

Here’s a very brief rundown of the system, before I start to propose how it could easily change to benefit everyone involved:

  • Users pay a fee directly to streaming services to listen to all the music they want, on all their devices, even when offline. The running cost of this hovers around $10 USD.
  • Streaming services pay artists per streamed song, an average of $0.005 (it varies slightly by country). This is a fraction of a penny. An example: Arcade Fire, arguably one of the hottest bands at the moment, has around 400 000 plays on Rdio. This translates to about $2000— presumably split between six band members, management, and publishing. If even 10% of streamed songs were purchased at $0.99, they would have earned closer to $40 000. For lesser known artists, the numbers are much, much lower.
  • Some services have been fighting to pay even less per stream as they think it is hurting their bottom line.

So I propose some minor changes be implemented that would have a drastic and positive effect on the way music is consumed and how artists are paid through streaming sites.

  • Reasonable use. Stream all the music you want, but I propose that if you listen to a song in your ‘collection’ more than three times, you buy it for $0.99. The money would go directly to the artist, you’d be supporting the music you love, and you’d have the song permanently in your collection. Win win.
  • The site would have an option when you sign up to either automatically charge your credit card for the songs you listen to more than three times ($0.99 one time charge to own that song) or have an option to be prompted after you’ve listened to the song twice that would remind you that, “John, you seem to love this song! You’ll have to purchase it to listen to it more. Thank you for supporting the artists you love!”

A second hand effect would be that it would encourage the listener to discover more music based on the artists they like, in order to maximize their subscription. This model could change the game. The artists would be earning a much better wage for their work and the services would not lose any money from their monthly subscriptions.

People will argue that having to pay more would dissuade many from using these streaming services. This may be true, but I believe strongly that if a value is placed on something, people will eventually accept, and, hopefully, understand it. There is an inherent value in the music you listen to; someone spent their time and money to create and distribute it. If you enjoy your music, it’s time to rethink unlimited consumption.

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3 thoughts on “How streaming could be good for artists

  1. I’m not sure how all of this works out. Getting people to pay more has, so far, not worked very well. This is going to come to other industries as well – Netflix and Youtube now account for half of all web traffic. Netflix is $10 / month and YouTube is free. There is also talk about applying the netflix model to books – so for $30/month people would have unlimited movies, tv, music and books.

    One thing I’ve wondered about is how much the average person spent 10 years ago. It wasn’t unlimited, but I don’t know that they spent much more than $30/month on average. People would just listen to the same CD / watch the same movie more. One thing that has changed is that there are a lot more players in the game – It used to be difficult and expensive to get a record made or a book published. It’s not anymore. Even the price of making movies is coming down rapidly. So whatever size the pie is, it is being divided between more and more people.

    So, back to square 1. I don’t know what the answer is. People, so far, are reluctant to pay money they don’t have to (most people I know don’t have much ‘extra’ in the first place). Under the current system artists aren’t getting paid enough, but the price keeps coming down rather than going up. There are even a growing number of free options out there.

    One thing I’d like to see, that I think would solve a ton of problems all at once, is a ‘basic guaranteed income’ ( http://dangerousminds.net/comments/jobs_are_not_the_answer_the_big_idea_that_libertarians_and_socialists_alike ) which would provide everyone, regardless of occupation, with a basic income that put them over the poverty line. That would at least keep the rent paid, the lights on and food in the fridge regardless of what else was going on.

    • Some really great thoughts here, Justin, apologies for the delayed response. The guaranteed income would be a great model, but so hard to apply for artists as it would great depend on output. I’m going to read that article you linked, thanks for that.

      • No problem Kat, you’re a busy lady – the Guaranteed Income, if it were ever implemented, would work the same for everyone regardless of profession. Everyone who filed taxes, regardless of their tax bracket, would get a cheque every month – this would be paid for by the increase in taxes (as people’s incomes go up, so do taxes), increased economic activity and cutting targeted programs – so instead of getting $200/month to help with rent and $200 to help with food (or whatever) – everyone just gets a thousand (or some other number) for whatever it is they need, without applying for it, filling out additional forms or demonstrating need. Wealthy people would get it too – they’d just pay most of it back in taxes.

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