Stop Thinking of Yourself as a Good Person: The Ethics and Economics of Music Streaming

Artists would still be getting more than they are now in Karl's example so it is still a good idea

y'all realize it's not gonna be $10 forever, right?

I wouldn't be surprised if somewhere down the road, you're paying $10/month for access to a genre-limited subset of the Total Library, with the option to pay more in order to listen outside your home genre, or for add-ons like a monthly curated "emerging artists" playlist

That would be a terrible product tho, they shd just nationalize the music industry and pay musicians through taxes on non musicians

I dunno local bands used to routinely repress after going through a run of 1000....Fugazi could sell over 200k independently, stuff like Pretty Hate Machine by NIN sold millions

― Ma$e-en-scène (upper mississippi sh@kedown), Thursday, August 20, 2015 3:26 PM (Yesterday) Bookmark Flag Post Permalink

but you could kinda live off of an indie hit, or so i hear.

― lil urbane (Jordan), Thursday, August 20, 2015 3:31 PM (Yesterday) Bookmark Flag Post Permalink

xpost Yeah, but those are outliers and also pretty big acts in their own right. (And of course, how much Pretty Hate Machine money did Trent see? He and TVT were sue-buddies for years.) I imagine most lil' acts probably top off pretty low on the sales scale, and always have. Even big indie sellers probably don't sell enough to live on minus a steady diet of touring and merch sales, which is still how bands largely support themselves.

― Josh in Chicago, Thursday, August 20, 2015 3:37 PM (Yesterday) Bookmark Flag Post Permalink

i think ppl used to be able to get by on record sales though, like i read stuff about vic chestnutt that was heartbreaking in terms of getting dropped and then watching things disappear.

i never once heard the "musicians only make money off touring they don't make anything off records" until people could download shit for free

it's not so much wow someone used to sell 500,000 records and make a shit load, it was the people like, i dunno...god....Joe Henry or someone like that in the 90s, who could probably make a liveable middle class income from sales (or better)

like people who used to sell 60,000 albums on an indie who now sell like 800

― Ma$e-en-scène (upper mississippi sh@kedown), Thursday, August 20, 2015 3:45 PM (Yesterday) Bookmark Flag Post Permalink

Bolded part is a massive t-bomb.

Also my band (circa '03-'05) sold like 800 CDs mostly through shows and CDBaby, and the CD actually paid for its (studio) recording costs plus helped pay for a tour (from which we did NOT make money). People forget how profitable CDs used to be for bands that actually did have 50/50 type deals with labels or self-released when they say "bands didn't make money from CDs anyway".

around 04-05 my band sold over 100 CDS AT A CD RELEASE SHOW, now it's hard to do 100 period

but yeah we were able to stash show money for recording/space rent, and generally break even

I get that, and I've done it myself. CDs/record sales def. help(ed). But unless you were selling a ton they're still mostly subsidizing a hand to mouth existence, aka break even. Which is not a bad place to be, doing something that you love, but doesn't exactly allow for much idle time, especially after you divide your gross 4 ways, pay off recording, fix the van, pay rent, eat, etc.

When I was in a touring band, the worst would be when you'd play with a shit act on the bill, and they'd want to swap one of their CDs for yours, and you'd be thinking, that's our money I am giving you!

I guess basically what I'm saying is just because it was always bad doesn't mean it's not worse now

And I don't even think we've hit bottom yet! At least clubs still seem to be hanging around.

I suppose land values and leases will kill off all the NYC & SF small venues soon enough

the casual cruelty of the new elite:

https://twitter.com/pmarca/status/636107643191365632

are there good articles out there about the contemporary live music industry or w/e? feel like there's something going on there but i only ever hear about "the death of the music industry".

i mean "death of the record industry"

Most live music is paid through beer.

xps i think that should be 'substitute' not complement

i am cautiously hopeful that this streaming shit will put $$$ back in musician's pockets because as more streaming services pop up they'll compete for material by offering labels more. no one seems to argue that netflix/hulu is bad for tv or movies? the only weird thing is that you don't pay per piece of music so there's weird zero marginal cost stuff. like previously you could buy one album and you can listen to it a million times, now you listen to as many albums as many times as you can

the big black box for me is how music gets distributed b/w labels and musicians and whether or how that's changed. i've tried to research this but seems opaque if anyone's got links please share

also i don't understand how freemium can work as a business model for anything but especially music

also i don't know what the morality has to do with it... if music is on spotify or applemusic, the person who owns the music agreed to put it there and is getting compensated for it. how is it immoral to listen to it?

devil's advocate would be it's not so clear cut -- the music industry is changing and artists are left with only shitty choices: stream and get a little bit of money or don't stream and get nothing. is it ok to buy sweatshop-made clothes if the workers there "agreed" to their conditions? the

the big black box for me is how music gets distributed b/w labels and musicians and whether or how that's changed.

you mean digital or physical?

I think "Freemium" is simply a loss leader, a strategy to get people to start using it. They will likely gradually reduce the content available to free users, and add more perks for the subscriptions, and gradually up the price of the monthly subscription. Remember when cable TV only cost $12 to $15 a month in the 90s (at least in the U.S.) and people complained bitterly? Well, they kept watching, and kept paying. Now most people pay well over $100 a month, and of course still complain. But admittedly the quality (HD), features (ability to record up to 4-5 shows simultaneously on latest DVRs) and amount of content is better than ever.

I finally laid down my thoughts on it here. Apologies if the writing is not quite up to snuff, I was distracted by a health scare (I'm okay):

No Whining in Rock ‘n’ Roll: Don’t Feel Guilty About Not Spending More Money on Music
http://fastnbulbous.com/no-whining-in-rock-n-roll-dont-feel-guilty-about-not-spending-more-money-on-music/

the big black box for me is how music gets distributed b/w labels and musicians and whether or how that's changed.

you mean digital or physical?

― lil urbane (Jordan), Tuesday, August 25, 2015 10:26 PM (2 days ago) Bookmark Flag Post Permalink

oh sorry that should say how revenue gets distributed. i'm wondering if the collapse of the market resulted in artists taking a smaller share of a reduced pie

i just read this https://www.techdirt.com/articles/20150204/07310329906/yes-major-record-labels-are-keeping-nearly-all-money-they-get-spotify-rather-than-giving-it-to-artists.shtml which argues that it's not that streaming services don't give enough of the revenue back (they keep 20% (also spotify is not currently profitable)) but that labels only give 10% of that 80% to artists. it argues that while this may have once made sense when labels had to actually press records, that no longer applies and they're just ripping off artists.

also did some googling and found these stats from ifpi.org

- number of paying subscribers doubled from 20 to 41 million between 2012 and 2014, and increased fivefold if you go back to 2010

- digital (includes both streaming and downloads) sales overtook physical world-wide this year

- overall industry value in 2014 is about 15 billion $, still down about 25 billion $ from 40 billion $ peak 1999. couldn't find what the nadir was

devil's advocate would be it's not so clear cut -- the music industry is changing and artists are left with only shitty choices: stream and get a little bit of money or don't stream and get nothing. is it ok to buy sweatshop-made clothes if the workers there "agreed" to their conditions?

― usic ally (k3vin k.), Tuesday, August 25, 2015 8:03 PM (2 days ago) Bookmark Flag Post Permalink

if what i wrote above is true they're not getting shitty deal because of streaming but because of how label distributes revenue from streams and "NO ONE IS STOPPING YOU FROM PURCHASING A NON-STREAMING VERSION OF THE MUSIC YOU LIKE IF THAT'S ACTUALLY IMPORTANT TO YOU" is not a good way to think about it.

like, if your only metric is "how much money am i spending on music" and you think you're robbing artists because you're not spending enough on music, well... it could be that if you spent more money on iTunes or buying compact discs, the same absolute amount of money would go to the artist than if you streamed. you can't think about the ethics until you know how revenue is shared for each medium

it's not exactly comparable to sweatshop shoes, like if you really care about musicians having money you could write them a cheque, they're generally identifiable people.. also depending on the contract artists get paid per record sold, so you could just stream, go to best buy and buy 20 compact discs then throw them all in the trash

another article with the blame-the-labels line

https://pando.com/2015/06/07/can-apple-save-the-music-industry-from-the-destructive-greed-of-record-labels/

That URL is a trick question, the greed of record labels IS the music industry.

read the actual article not the url. it's good

The revenue generated by ads on the free tiers of these platforms is dismal in comparison to the revenue generated by subscription fees. According to the most recent IFPI Digital Music Report, the revenue created by ads served up to the estimated 400 million people who use free on-demand streaming music services each month -- that includes YouTube which we often forget is the most-used streaming music platform on the planet -- was only $610 million, Meanwhile, the revenue generated by the 41 million users who pay subscription fees to use Spotify, Rdio, or Deezer is 1.6 billion. That means one-tenth of the world's digital listenership generated over two-and-a-half times more revenue than everybody else. Extrapolate that as a per-user figure, and you'll find that each paying customer created 26 times more revenue a year than each freeloader who generates revenue solely by suffering through -- and likely tuning out -- audio ads.

another interesting thing that i think wasn't considered by DJP & co in the big quote upthread is: the amount of music people consumed increased A LOT after it became free. but the amount they were purchasing before was really small. from panda article:

Even in the 1990s at the height of the music industry, when Americans spent more on music than ever before, the average US consumer only dropped $28 a year on the medium.

so now you have all these people who got used to listening to free music all day... and if you can somehow figure a way to charge them just 10$/month, revenue would explode to tenfold of the nineties peak

As of June, Spotify had 75 million users and 20 million paid subscribers ($10/month). Like I said above, it's a loss leader, and I'm quite sure their plan will be to soon start restricting access to certain content to free users, hopefully converting a certain percentage of them to paid subscribers.

As I discussed in my article, just limiting free content will not be enough. They are going to have to add value to the experience that currently does not yet exist. Columbia House is for sale. Imagine if licensing of all the music and labels CH had would be inherited. That would be extremely valuable. Even if not, the brand is worth something. It would be really interesting to see a company like Netflix buy the brand, adapt it to their model in a modified form, such as $15/month for 3 digital albums a month (all the common formats, including lossless and hey, why not the option of renting the CDs like they are doing with DVDs), $25 for 6, $35 for 10 and so on. If they want to really do it right, offer incentives for the more dedicated fans such as concert tickets, fan clubs, t-shirts, special edition CDs/digital albums with bonus tracks, etc. Maybe partner with Spotify, or a competitor.

Are you saying subscription rental streams? Because emusic already did subscription downloads.

> ($10/month)

£9.99 a month in the uk = $15

Emusic didn't do it very well (interface, available selection, competitive pricing, lossless, etc). It doesn't mean it wouldn't work when done properly.

I see on the Spotify Foals page they have three t-shirts on display to buy from the band. It's a start, of sorts. Friggin' ridiculous there's no links to buy the music.

Hills - Frid is out today, but still only one song from the album is available from Spotify. They should make it so subscribers can stream it the first month, and free users can buy the download for $4-5 and also be able to stream.

"Even in the 1990s at the height of the music industry, when Americans spent more on music than ever before, the average US consumer only dropped $28 a year on the medium."

People listened to the radio more back then too.

t flopson: you've heard of this thing called bandcamp, right?

paying for self-released digital content thru bandcamp is the only time I feel like an "ethical music consumer" ever anymore. everything else is bullshit

ok

even if they get most or all of the money i don't think bands make very much money off bandcamp cause people don't seem to buy tonnes of music off bandcamp and streams are free and i don't see it taking off in a huge way? but i'm glad it makes you feel good i guess

i guess i don't think "which way of buying music online gives ilx posters a warm glow" is as interesting as "what's a viable model for the music industry" maybe this is the wrong thread

> paying for self-released digital content thru bandcamp is the only time I feel like an "ethical music consumer" ever anymore. everything else is bullshit

buying cds at gigs?

only "gigs" I go to anymore are DJ nights haha

... although come to think of it, I would probably "buy" mixes from some of my DJ friends -- I think this used to be called "bootlegging" and I would be quite happy to take part in it :)

Please be more thoughtful when you parrot party lines offered by Pando et al. Tech sites are very snugly in the pockets of the companies they cover.

(I very much believe that the flood-the-zone nature of tech sites and their employees' lack of knowledge about the music business/pandering to the crowd that thinks culture appealing straight to them is just hatched because they've been used to having marketing directed at them all their lives helped accelerate the current untenable situation. Remember when all those sites thought QTrax and SpiralFrog were going to be huge?)

Please be more thoughtful when you parrot party lines offered by Pando et al

do you have a debunking of any of the stuff i quoted from it or you just don't like the url/byline?

oh I just realized Pando is the website that the posted article I pointedly ignored upthread v_v

it was directed at me

(I very much believe that the flood-the-zone nature of tech sites and their employees' lack of knowledge about the music business/pandering to the crowd that thinks culture appealing straight to them is just hatched because they've been used to having marketing directed at them all their lives helped accelerate the current untenable situation. Remember when all those sites thought QTrax and SpiralFrog were going to be huge?)

― maura, Friday, August 28, 2015 11:04 AM (3 minutes ago) Bookmark Flag Post Permalink

you should read the article i posted it's good it's not related to what you're describing

"even if they get most or all of the money i don't think bands make very much money off bandcamp cause people don't seem to buy tonnes of music off bandcamp and streams are free"

but there are often payment options for CDs and vinyl and i do think people buy these after listening to the streams. maybe not a ton, but if i were an artist i would rather take my chances there than with the big sites like spotify.

the Legendary Pink Dots make a living wage off of their Bandcamp, according to them

That's good to hear. They certainly have a huge catalogue to sell.

I thought maybe "Pando" was a merger between Pandora and Panda Express. Discount lunch deliveries with yr tunes.

Flopson is right, Bandcamp and buying CDs at shows are fine options for the more dedicated fans. But the masses are not going to go out of their way to spend money out of any sense of obligation or guilt. There needs to be a well-planned approach that gets people excited about getting music and paying for it. It really isn't rocket science, and shouldn't be that hard. Music is way more fun to buy than most of the other shit we have to buy and spend way more money on. There have to be incentives, perks, deals, swag, all the stuff that make people feel they are getting value, not ripped off.

Aside from actual physical merchandise, the rest is all ones and zeroes, and it's just a massive, massive failure of the music industry to not even try capitalize on it on good faith, and while treating their customers with respect rather than bludgeoning them with lawsuits, since 2000.

Pando has a much more adversarial relationship to most of the tech industry than any other tech site i can think of.

even if they get most or all of the money i don't think bands make very much money off bandcamp cause people don't seem to buy tonnes of music off bandcamp and streams are free and i don't see it taking off in a huge way? but i'm glad it makes you feel good i guess

some indie artists who focus their thing around Bandcamp (i.e. making it the only place to get the record) make most of their money from it. you can get an idea just from the little avatar squares that show up for each person who has bought a record and also have a 'fan' account. like, looking at a recent fixed-price album for a pretty popular indie rapper, that's $3,600 right there, minus $540 for Bandcamp's cut. And there are probably a bunch more people who bought it without creating a fan account.

Maybe that's not very much money in the grand scheme of things, but it's not nothing either (and you get it in your pocket right away too). And it does feel like the go-to place to directly support an artist. For a couple albums that I found myself streaming all the time, I bought them on Bandcamp and didn't even download.

xxxxp