Topic: Economics of Music Streaming

[jackh]

Music streaming is a topic I've been keen to start a post about for quite a while, but the moment just never quite came.  Feel like now might be the time, given that there's currently an ongoing inquiry inquiry into the economics of music streaming being observed by a Digital, Culture, Media & Sport Committee, that social media is awash with people posting their 'Spotify Wrapped' results, and that the Guardian have made it very easy for me with a nice couple of articles covering the recent developments (around the inquiry).  Tensions have been mounting in this area for some time, but the discussion has really come to the fore during 2020 - it's been increasingly clear over recent years that artists are ever-more reliant on live performance to earn a living in the current economic context of the industry, but that's not been possible for most of the year and - even with vaccine developments - still looks some time away.

What are your own thoughts & feelings on the matter, and what do you 'do' in relation to your music listening/purchasing?

For me, I'm still buying things in physical format.  I think this initially stemmed from a bit of a traditional/old-fashioned outlook - I like the sense of 'ownership' & connection to what I listen to; I like to 'have' a collection; and I value the romantic notion of sharing a physical item when offering/receiving a recommendation.  Some of my older CDs still smell of the wooden chest of drawers that they were kept in at old house; I like the scuffed & dog-eared lyric booklets of CDs that I'd have read/sung along with when I was young; and the first CD I had of my favourite band (who I've been banging on about for a few months on here actually!) was a promo copy handed to me by a friend in a GCSE English class!  As CD releases move away from the three decades of plastic cases, they're also more closely resembling works of art akin to vinyl releases.

I've probably arrived at my feelings on streaming as a way of justifying my reluctance to change those habits, rather than being passionate about it to begin with, but I've increasingly dug my heels in as I've learned more.  And so I have a 700/800-strong CD collection, which continues to grow - I tend to listen to BBC 6 Music as my main source of 'being kept up to date', and new things that capture my interest will get regular plays on YouTube for a week or two before I either make a purchase or forget about it.  There have, over the last couple of years, been a few occasions on which an artist has not released on CD - in these cases (as I've not got a vinyl player), I'll tend to opt for digital download (which of course isn't to be confused with streaming).

I'll pop some of those recent news pieces in to get things started:


https://www.theguardian.com/music/2020/may/11/musicians-music-industry-lockdown-streaming-spotify-coronavirus

Musicians call for industry shake-up to protect artists during lockdown

Two new campaigns call for artists to receive greater cut of Spotify and streaming royalties

Two organisations that represent thousands of British musicians and songwriters will today launch a Keep Music Alive campaign calling for urgent changes to the music industry to protect artists at risk of ruin as a result of the coronavirus crisis.

The campaign calls for solutions to the problems that the lockdown has inflicted on musicians. The suspension of live music under lockdown has cut off most artists’ one dependable source of income: gigs. And payments from streaming services such as Spotify are so negligible that they cannot hope to fill the massive hole in artists’ incomes.

The campaign has been organised by the 30,000-strong Musicians’ Union and The Ivors Academy, named after the iconic Welsh composer and actor Ivor Novello and based around a community of songwriters and composers. Together, they are trying to alert tech platforms, record companies, politicians and listeners to the worsening predicament of those who make music.

Keep Music Alive’s launch statement makes the basic point clear: “This crisis has brought into sharp relief the fact that creators and performers are sustained primarily by the live side of the music business and that streaming royalties are woefully insufficient.”

An online campaign titled Broken Record is also taking shape. It has been co-created by Tom Gray of the Mercury prize-winning band Gomez, who is also a director of the Performing Rights Society, the body that sees to musicians’ payment from such sources as radio stations and the music played in pubs and hotels.

On Sunday 24 May, Broken Record will host an evening of the hugely popular Twitter listening parties run by Tim Burgess of the Charlatans, which will feature such names as Boy George, the cult US band the Shins, and the critically acclaimed singer-songwriter John Grant.

“Covid-19 happened and I was sitting there just thinking, ‘Live music has gone, and it’s going to be gone for a long time,’” says Gray.

A big chunk of musicians’ money comes from hairdressers and bars and cafes that pay for music licences, but that’s now going to take a big hit. So the only type of income that’s available is from streaming. And I just thought, ‘If this isn’t a moment to do something about this, when is?’”

One of the big names on the running order for Broken Record’s Twitter listening party is the Scottish artist KT Tunstall. Around five weeks ago, she says she had an angry epiphany. “Online, everyone was clamouring to be entertained, and just expecting to get that for free,” she said.

“There was general feeling I was getting on social media: ‘You’re not gigging any more, you’re just sitting at home. So why not get on Facebook or Instagram and play for us?’ And I was like, ‘I tell you why I don’t want to do that – it’s because that’s how I make a living, and I’ve just lost 200 shows this year, and it’s completely decimated my income.’”

This year, she says, was set to be one of her busiest yet. How much money does she think she has lost? “Over a million quid.”

She means revenue, not profit – and because the margins of touring are so tight, any money she would have made would hardly equate to riches.

She then turns her attention to the streaming issue. “Labels and streaming platforms are mistakenly thinking they’re the product. And they’re not. The providers of the product are just getting completely screwed. ”

Spotify is reckoned to pay out an average of only £0.0028 (or 0.28p) per stream to so-called “rights holders”, a term that encompasses both massive record companies and artists who put out their own music. On YouTube, the per-stream rate is put at a mere £0.0012.

The lion’s share of streaming payouts goes to the three big major music corporations, Universal, Sony and Warner Music, who still largely base the way they reward artists on a system created when companies had to cover the costs of manufacturing records and CDs. Even in the age of streaming, these firms tend to keep most of the money generated by sales and streaming sites, making many artists’ livelihoods all the more fragile.

Songwriters are even in a more precarious position. One of the prime movers in both campaigns is Crispin Hunt, once the singer with the Britpop-era band the Longpigs and now a professional songwriter who has worked withEllie Goulding and Florence and the Machine, and the current chair of the Ivors Academy.

“I’ve been successful,” he says. “But the wolves are at the door, constantly.”

As an illustration, Hunt mentions his co-writing of Broken, a 2013 single by the British singer Jake Bugg that has amassed tens of millions of plays on YouTube. In the first two years after its release, he says, YouTube paid him £158. His last money from Spotify, he says, was centred on a Longpigs song titled On and On, a top 20 hit from 1996, which down the years has amassed nearly 3m plays. In the last three months, it notched up 25,000 UK plays, which netted him only £5.

The Musicians’ Union and Ivors Academy campaign is so far steering clear of any specific demands, aiming instead at raising awareness of a system they say is “broken”.

Hunt suggests one solution could be an equal four-way split of the streaming services’ revenues between the platforms themselves, record labels, songwriters and performers. Gray thinks part of the answer might lie in ensuring that some of people’s online music subscriptions – £9.99 a month for individuals, on both Spotify and Apple Music – is distributed to the artists they actually listen to.

One of the most unfair aspects of streaming, he says, is that everyone’s subscriptions go into one big pot, large amounts of which are channelled to the major labels and a handful of their hugely successful artists. So, however niche your tastes, a lot of your money inevitably goes to the likes of Ed Sheeran and Taylor Swift.

In response,Spotifysaid: “The vast majority of revenue generated on Spotify is paid out to rights holders, including labels, publishing companies, and distributors … Spotify is helping fuel the growth of the music industry overall, which just experienced its fifth straight year of growth.”

A spokesperson for YouTube said the company pays the music industry “rates that are on par with the rest of the industry across both the advertising and subscription businesses”.

A statement from the BPI, the organisation that represents UK record labels including the three big corporates, insisted that “record labels are the leading investors in music to help artists achieve success”, but also sounded a note of sympathy with campaigning musicians: “The central issue remains the gulf between the value of music exploited by the large user-upload video platforms and the value they return to music creators … The platforms can do better; they just need to be held accountable.”

https://www.theguardian.com/business/2020/nov/24/streaming-threatens-future-of-uk-music-says-elbows-guy-garvey

Economics of streaming are 'threatening future of music', says Elbow's Guy Garvey

Musicians from Radiohead, Gomez and Elbow tell MPs that the industry must reform and be made fairer

The three major music labels are operating “like a cartel” in the streaming era and the current system is threatening the future of music in the UK, according to evidence given on the first day of an inquiry into the impact of streaming on the music industry.

During the digital, culture, media and sport select committee inquiry into the economics of music streaming, MPs heard from musicians including Ed O’Brien of Radiohead, Elbow’s Guy Garvey, and Tom Gray of Gomez, who painted a bleak picture of artists struggling to survive.

Garvey said the “system as it is is threatening the future of music”, while equitable remuneration, increased transparency and user-centric streaming models were put forward as ways in which the industry could be reformed and made fairer for artists.

Gray, who is the founder of #BrokenRecord Campaign, said some artists were still tied to contracts that included antiquated clauses, such as a 10% damage clause, which saw labels work on the assumption that 10% of CDs would be broken in transport.

An artist’s share is then worked out from the remaining 90%, despite the fact in the streaming age barely any CDs are sold. Tom Frederikse, a solicitor and former producer, who also gave evidence, said in some cases the damage clause was as high as 25%.

“What’s very clear is over 70% of consumers think artists are underpaid. As soon as anyone sees this data and learns the terms of the payment deal, everyone comes to the same conclusion: it’s not right,” said Gray.

After hearing the evidence, Julie Elliott MP said it sounded as if the three major labels – Warner Brothers, Sony and Universal – were operating “like a cartel” because of what Gray called “suspiciously similar” artist contracts.

Gray referred to a recent YouGov poll which found that 77% of customers believed artists were not getting a fair deal, and reports that Universal recorded revenues of $1.14bn in the last quarter despite the global pandemic and economic downturn.

MPs heard that the huge profits seen by major labels were not trickling down to artists who, in the case of Nadine Shah who also gave evidence, were struggling to make ends meet in the streaming era. Streaming was worth around £1bn last year, however, artists had been reportedly paid only 13% of the income generated.

The musicians said artists were having to adapt to a streaming model that had rapidly replaced the system that existed when they were first signed.

O’Brien said when Radiohead were signed in 1991 there were huge imbalances but that the streaming era had exacerbated them. “It’s interesting to see your reaction to the testimony this morning because you’re becoming aware of the unfairness and the opaqueness within the business, and then you’re bolting on this digital model. And it’s not working,” he said.

Garvey said Elbow had recently shortened the intro of a track so that it would be more likely to appear on playlists. Gray told the committee that genres such as jazz and classical were struggling because their longer length tracks don’t suit the playlist system, which he said benefits easy listening and muzak.

Gray also told the committee he had heard of cases in which people who ran influential playlists on streaming platforms were being paid to include tracks, calling it a modern form of “payola”.

The inquiry continues and will hear the “perspectives of industry experts, artists and record labels as well as streaming platforms themselves”. The chair, Julian Knight MP, said the goal was to ask whether the business models used by major streaming platforms were “fair to the writers and performers who provide the material”.

https://www.theguardian.com/music/2020/nov/30/guy-garvey-says-music-fans-should-pay-more-for-streaming-services

Guy Garvey says music fans should pay more for streaming services

Elbow frontman says system is not sustainable and bands are struggling to sustain careers

Music fans have to be prepared to pay more for the songs they love in the streaming age, according to Elbow’s Guy Garvey, who says the next generation of bands are being lost because they cannot sustain careers in the current climate.

Garvey, who gave evidence last week to a Department for Digital, Culture, Media and Sport inquiry into the impact of streaming, told the Guardian he believed services such as Spotify and Apple Music were not charging enough.

“The big picture is that £10 a month for access to all music is too little,” he said. “It came out in the committee the other day: everyone feels a little bit guilty for having access to all this music for fuck all. It’s not sustainable and the emergency is we’re losing artists because they’re demoralised and they can’t afford to live.”

Garvey is pushing for equitable remuneration in which streams are split 50/50 between labels and groups, meaning a percentage goes directly to the people who made the recording. He called it “reliable income that’s nothing to do with the labels or to do with the streaming platform – it’s a right”.

Equitable remuneration already applies to broadcast usage in the UK, and Garvey and others who gave evidence – including the founder of the #BrokenRecord campaign, Gomez’s Tom Gray – want it to be extended to cover streaming.

Garvey is confident a new consensus can be reached between labels, artists and consumers, and sees the current moment as an opportunity to make music more sustainable for artists.

He said: “What we need to do is talk to everybody that has set up this incredible way of listening to music … because this is an opportunity to make things fair that frankly haven’t been for a good 100 years.”

Elbow formed in the 90s and rose to prominence with their debut album, 2001’s Asleep in the Back, which was shortlisted for the Mercury prize. Garvey praised the record labels he has worked with and said they had been able to nurture the band and take them from playing in pubs to becoming a huge live draw and a critically lauded group.

He said: “It’s about connecting music with its audience and Elbow had so much help from record labels in doing that. They know what they’re there to do and they’re proud of it. It’s just we’ve dropped the ball between us.”

Garvey said the revelatory moment for many during the evidence was when MPs heard that even though they might only listen to one or two albums on a streaming site, their subscription fee would mostly go to bigger artists.

“People don’t realise that their artists don’t get their cash and that needs fixing,” he said. “I think it will be fixed and it will be the labels and the artists and a bit of government, and it will also be the streaming platforms, and it will be the consumers that fix it.”

Garvey said that as Brexit looms he thought there should be an artistic passport for British and European artists so that tours are not lumbered with additional costs for visas. “There is no such thing as an MP who wants to be seen as not liking music,” he said.

“Everyone needs to get organised, that’s all. So we’ll have to come up with some kind of artistic passport that doesn’t involve too much red tape or any money. And that has to happen pretty fast, and has to last until we rejoin Europe.”

[jackh]

Tom Gray (of the band Gomez) is a passionate voice on this topic, running the #BrokenRecord campaign.

Tom Gray #BrokenRecord @MrTomGray
Why the music industry HAS to change and why it has to change now. A thread. Stick with it!
11:56 am · 12 Apr 2020·

Tom Gray #BrokenRecord  @MrTomGray
Fun for you.

Get your #Wrapped2020 from @Spotify

Divide your minutes by 3.5. That’s how many songs you listened to.

Then divide by 12. That’s songs each month.

Times that by 0.0035. That’s roughly how much of your subscription goes to your selections.

#BrokenRecord
11:15 am · 2 Dec 2020·

Illinois artist, Ezra Furman has commented today:

Ezra Furman  @ezrafurman
I shouldn’t have to point this out but

If you are looking at a huge number of minutes you “spent” with a music artist

On a platform that pays those artists ~$0 for said minutes

Perhaps you should consider buying something from that artist
4:21 am · 2 Dec 2020·

[jackh]

https://www.theguardian.com/music/2020/dec/01/mps-warn-music-streaming-platforms-against-interference-in-inquiry

Musicians fear reprisals for speaking to MPs' streaming inquiry

Select committee warns music platforms against interference after witnesses say careers put at risk

A Commons select committee has warned that no one should interfere with its inquiry into the economics of music streaming, after witnesses expressed fear that speaking up could harm their careers.

The Department for Digital, Culture, Media and Sport (DCMS) committee is examining the effect of services including Spotify and Apple Music on the wider music industry, and has already heard evidence from recording artists including Guy Garvey of Elbow, Ed O’Brien of Radiohead, and the singer-songwriter Nadine Shah.

But the committee chair, Julian Knight MP, has warned that further testimony was limited by the fear of retaliation. “We have been told by many different sources that some of the people interested in speaking to us have become reluctant to do so because they fear action may be taken against them if they speak in public,” Knight said.

“I would like to say that we would take a very dim view if we had any evidence of anyone interfering with witnesses to one of our inquiries. No one should suffer any detriment for speaking to a parliamentary committee and anyone deliberately causing harm to one of our witnesses would be in danger of being in contempt of this House.

“This committee will brook no such interference and will not hesitate to name and shame anyone proven to be involved in such activity.”

In November, Nadine Shah told the committee: “Speaking on behalf of many of my friends, my fellow musicians, so many of them are scared to speak out because, myself included, we do not want to lose favour with the streaming platforms, and we do not want to lose favour with the major labels. You called me brave, some have called me stupid, but I am used to it.”

Tom Gray, of Gomez, the founder of the #BrokenRecord campaign who gave evidence at the committee, said the revelation was not a surprise to him. “I don’t think it’s incredible at all. If you go back through all of the evidence about young artists being afraid to come forward or what Nadine Shah said – ‘My friends say I’m stupid’ – nobody was fucking joking.”

He added: “There’s genuine jeopardy here for artists. There’s only one mode of selling music any more and that one mode controls everything in an artist’s life: their remuneration from the recorded works, their exposure to new audiences, their continuing relevance. These aren’t small things for an artist, it’s basically our world.”

Streaming services hold an enormous amount of power over artists, with the ability to grant or deny promotion through placement in playlists, on homepages and on algorithmic “radios” proving pivotal in the success of new music.

Last month, Spotify made that power explicit, offering artists the ability to artificially promote their music on the company’s artist radio feature, which plays songs similar to a given band. Acts who signed up to the “experiment” would have a selected song added to the artist radio more often – but would be paid a lower royalty rate in exchange. “This a form of payola or sponsored social media post,” said David C Lowery, the singer-songwriter in Camper Van Beethoven. “It is not necessarily illegal but the tracks would need to be labelled.”

Spotify did not reply to requests for comment.

[jackh]

That's all from me for now, apologies for the multiple posts

[Zlen]

It's a very interesting topic.
Obviously streaming platforms are great for consumers, the sheer convenience of it is something beyond our wildest dreams.
However it is clear as day that these platforms are selling artists short, very short in fact.

I don't know what the answer is honestly. I've moved from Spotify to Tidal recently, partly because they pay marginally more to artists, but also because they offer better sound quality. Also I'll buy lot of music on Bandcamp and see my favourite acts live whenever possible - but that won't move the needle at all. Until big names start telling Spotify to go fuck themselves and pay decent money - not much will change.

[Lone Star Red]

Love Spotify and have been using it for years, pretty much solely on Premium. Has completely changed the game for me in the way I listen to music and mainly the sheer amount of bands and artists I've been able to discover through the platform.

Having said that, I am well aware that they are screwing artists over with how little the artists get from my hours upon hours of streaming. If Spotify were to charge me another $3-$5 a month with a guarantee that all of that money or a far greater portion of that money would actually end up in artists' pockets, I would happily and easily do it. In the meantime, I try to support the musicians I really listen to and love with vinyl purchases or merch from their official shops when I can. I also paid and streamed into some virtual concerts for some of my favorite bands did this year as they tried to get creative with ways to connect to fans and make some money.

Fully realize that me listening to music through Spotify probably only exacerbates the problem at hand here - and if there is a solution(s) out there though, I'd be happy to be a part of it. Will keep my eye on this thread. Think it's a much-needed conversation and thanks Jack for starting this thread.

[Seebab]

Good thread topic and discussion.

I am also an adopter and love of Spotify. I move around a lot and so can't carry CDs everywhere with me and Spotify does the job brilliantly for me. I listened to so much new and old music, from all parts of the globe, which then leads me to buy merchandise and go to gigs for artists I would otherwise not have discovered. It is true that I listen to a lot more music than I spend and I do agree that the monthly premium is quite low.

I would honestly be happy to be another 5-10 pounds/dollars per month, but anything more than that and it's out of my range. All I can say is I don't want to go back to downloading torrents, etc, and can't afford paying for the high price of so many CDs either so Spotify is the perfect middle ground. I am the same as Lone Star though, if there is another solution out there to help musicians distribute their music for profit without charging outrageous fees, I am all ears.

[CraigDS]

I’d be interested to see some comparisons with regards to how much artists used to make from, say, CD sales compared to streaming.

I’d hazard a guess it is quite a bit less, but is this difference made up by the number of new fans they gain from the popularity of these streaming services and the additional income they get from other sales to these fans (ticket & merch sales, etc).

[Crosby Nick]

More thoughts from Tom Gray today:

https://mobile.twitter.com/MrTomGray/status/1278640654978031616

Sounds like no one really makes money from music sales/streaming anymore and obviously no one has been able to tour this year. Doesn’t really encourage bands/artists to really make a go of things when they’re starting out.

[CraigDS]

More thoughts from Tom Gray today:

https://mobile.twitter.com/MrTomGray/status/1278640654978031616

Sounds like no one really makes money from music sales/streaming anymore and obviously no one has been able to tour this year. Doesn’t really encourage bands/artists to really make a go of things when they’re starting out.

Again, it would be interesting to see how much they would have made from a CD single sale (I know it wasn't CD back then like).

I've always thought most artists didn't make all that much from sales, but a hell of a lot from touring, even back before streaming.

[Sheer Magnetism]

From what I can recall, artists used to make about £1.50 for writing and £1 for performing on a £10-£15 CD back in the late 90's, at the commercial peak of the music industry. Thing is, you don't start getting royalties until you've paid back the advance, and a huge amount of the expenses come out of the artist's side. Steve Albini has written about it in a fair bit of detail, and I remember one of the guys from the Bluetones saying he never made more than £12,500 a year for the vast majority of his career.

It's worth mentioning that a) Universal Music Group, Warner Music Group and Sony all own equity stakes in Spotify and Deezer as a condition of the licensing deals they signed a few years back; b) The idea the streaming platforms are making huge amounts of money is a myth. Spotify for example has lost huge amounts of money in recent years despite its revenue and user base growing significantly at the same time; and c) The physical mechanism of selling CDs and vinyl simply isn't there now the major chains are dead and the high street in general is in decline.

Spotify is a great way for new bands to get exposure, much more than through radio or the media these days. You could argue they should charge more and issue more in royalties, but gig prices have skyrocketed in recent years and the question is whether people would still pay or simply switch to a less legal service.

[CraigDS]

From what I can recall, artists used to make about £1.50 for writing and £1 for performing on a £10-£15 CD back in the late 90's, at the commercial peak of the music industry. Thing is, you don't start getting royalties until you've paid back the advance, and a huge amount of the expenses come out of the artist's side. Steve Albini has written about it in a fair bit of detail, and I remember one of the guys from the Bluetones saying he never made more than £12,500 a year for the vast majority of his career.

Yeah just been having a read an seems that it was roughly 10% that would go to the artist, although not necessarily 10% of the retail price, and they'd also have costs.

Like your example above, I read a quote from Nick Mason (Pink Floyd drummer and part of Featured Artists Coalition), which said the first 5 years most artists won't make much or any money at all (this was pre-streaming). I think now at least streaming allows for bands to be found much more easily and the potential to then make money from selling out tours which they'd maybe previously not be able to do until a couple or three albums in.

Also a good point I read was that previously bands would "force" fans to buy a whole album for a greater fee, which they'd then get a greater cut from, even if fans only regularly listened to a handful of those songs. Now though fans can pick to just listen to those songs they want and therefore artists get paid for less.

[WhereAngelsPlay]

I stream but like you I must have a physical copies of my favourite music.

[Mr Benn please?]

I have gone round the full circle. Started on vinyl in my mid teens. Dabbled with cassettes when I left home and didn't have space for a record player. Switched to CDs in the late 80s, when I was taken in by the marketing spiel of them being indestructible and better sound quality (both are incorrect). Stopped buying CDs when my kids were born due to lack of money so spent a few years just listening to CDs I owned rather than new music. Then discovered Spotify and 6 music and started listening to contemporary music again as well as discovering loads of old stuff.  Then rescued my old vinyl collection from my dad's loft and have started buying vinyl again. Including albums I had sold in the early 90s because I bought them on CD. As a consumer, Spotify allows you to listen to music and  buy it risk free rather than taking a punt on a duff album based on hearing a couple of tracks on the radio.

I fully take on board all of the points made by artists about streaming services. I make music myself. For me it's just a hobby and I'm not really looking to monetise it and streaming services are a good low cost way of getting people to listen to your music. I would be very pissed off though if I found that people were making much more money than me from my music. But I guess this whole situation has always happened in music. I'm sure we have all heard tales of unscrupulous promoters ripping off naïve artists back in the 60s, or blues singers having their songs pilfered by white rock bands. That's the trouble with art in capitalist society - people will always try and profit from it often at the artist's expense.

[damomad]

Great topic, and one that has been on my mind recently.

Stopped buying CD's when I was a teen. Discovered Napster/Limewire/Torrents etc and never looked back. Then streaming services came along. Spotify is an absolute steal: I can have access to every popular song ever created for the price of one album a month? On any platform? I'm all over that. I haven't downloaded music illegally since.

I've been toying with the idea of buying all my favourite albums in physical copy over the past year, to give something back to those albums that have changed my life one way or another. However, as someone who generally listens to music while on the move be it cars, walking, Spotify fits with my lifestyle a whole lot more, and the few albums that I do own have an inch of dust gathering on them.

A new film comes out on Netflix, is someone morally obliged to go out and pay £15 on a physical copy because they've enjoyed it? As someone said earlier, let's not pretend artists made any money off CD sales, the system has been shit for a long while. I try to give back by going to as many gigs as humanly possible (well I did before this).

One thing I will say, I'd easily pay 3 times as much for the subscription services as I do now.

[jackh]

Great topic, and one that has been on my mind recently.

Stopped buying CD's when I was a teen. Discovered Napster/Limewire/Torrents etc and never looked back. Then streaming services came along. Spotify is an absolute steal: I can have access to every popular song ever created for the price of one album a month? On any platform? I'm all over that. I haven't downloaded music illegally since.

I've been toying with the idea of buying all my favourite albums in physical copy over the past year, to give something back to those albums that have changed my life one way or another. However, as someone who generally listens to music while on the move be it cars, walking, Spotify fits with my lifestyle a whole lot more, and the few albums that I do own have an inch of dust gathering on them.

A new film comes out on Netflix, is someone morally obliged to go out and pay £15 on a physical copy because they've enjoyed it? As someone said earlier, let's not pretend artists made any money off CD sales, the system has been shit for a long while. I try to give back my going to as many gigs as humanly possible (well I did before this).

One thing I will say, I'd easily pay 3 times as much for the subscription services as I do now.

This is something I've thought about myself, from an 'am I a hypocrite?' perspective - I think one of the differences for me (flimsy as it may seem) is that Netflix (though I'm certainly no 'fan' of the organisation) is that Netflix do put significant funding into productions.

[CraigDS]

This is something I've thought about myself, from an 'am I a hypocrite?' perspective - I think one of the differences for me (flimsy as it may seem) is that Netflix (though I'm certainly no 'fan' of the organisation) is that Netflix do put significant funding into productions.

Do you stream anything illegally though? Films, football, etc?

[jackh]

Glad that this thread appears to have captured a but of attention.  There've been very rapid changes in the industry on this front during recent years, and streaming has been normalised very quickly - perhaps without the time for interrogation.

I certainly don't wish to spam the thread with news articles & Twitter links, but given that it's a very current topic (due to the inquiry), it seems worth sharing some of the headline information.  Nadine Shah wrote for the Guardian (who seem to be following this most closely) yesterday:

https://www.theguardian.com/business/2020/nov/24/nadine-shah-i-cant-pay-the-rent-on-unfair-music-streaming-revenues

Nadine Shah: 'I can't pay the rent on unfair music streaming revenues'

MPs told streaming has revived music industry’s fortunes but not helped artists

Mercury Prize-nominated singer-songwriter Nadine Shah has said that she makes so little money from streaming that she is struggling to pay her rent.

The 34-year-old told MPs that despite achieving commercial and critical success with four albums, payments from services such as Spotify were not enough. Shah added that the way streaming platforms and record labels carve up revenue is unfair for all but a few mega-artists.

“The earnings from streaming are not significant enough to keep the wolf away from the door,” she told the digital, culture, media & sport select committee inquiry into the economics of streaming. “I have a substantial profile, a substantial fanbase, I’m critically acclaimed but I don’t make enough money from streaming and am struggling to pay my rent. I am a successful musician, but I am just not being paid fairly for the work that I make.”

Tom Gray, singer with rock band Gomez and founder of the Broken Record campaign, told MPs that the streaming revolution had transformed the fortunes of the music industry but not trickled down to the tens of thousands of artists underpinning that success.

“I’m not here to argue for Paul McCartney to get more money,” he told MPs. “Far from it. This is happening while a few multinational corporations, foreign-based corporations, are making the most money, the best growth, the best profit margins, they have ever made in their history.”

Universal Music, the world’s biggest record company that is home to stars from Taylor Swift to the Beatles, recently reported recorded music revenues up 11% in the third quarter to £1.33bn. And Spotify, the world’s biggest streaming service, reported £1.6bn in revenues in the second quarter from almost 140 million subscribers paying $9.99 per month in the US, £9.99 in the UK.

The streaming revolution has dramatically reduced the costs associated with physical sales of CDs, records and cassettes – such as factoring in significant losses for stock damage – but music deals have not been restructured to give artists a share of the cost savings.

“The system as it is is threatening the future of music,” said Guy Garvey, singer and songwriter for Elbow and a BBC6 Music presenter. “It sounds dramatic … but it has become so skewed. Streaming is a bit of a miracle, the fact we have access to every piece of music in our back pocket for £10 a month is almost a miracle. If musicians are equitably paid then it is sustainable and everyone can be proud. Streaming has saved us from piracy – but not paying in such a way that it is making a difference to musicians starting out.”

The musicians who gave testimony to the select committee, including Radiohead guitarist Ed O’Brien, also expressed fears that the UK government has not planned to ensure that live touring remains viable in Europe following Brexit.

Live music, including tours and playing festivals – worth £1.3bn to UK artists in pre-Covid times – is the biggest income stream for almost every musician. Despite the UK preparing to exit transition arrangements with the European Union from January, there has been no news from government as to whether acts touring abroad will face costly new restrictions and red tape.

“We are not prepared for [Brexit] at all,” said O’Brien, who cancelled a solo tour earlier this year. “I speak to my managers and they are just waiting, we don’t know what is going to happen. It is key to sort this out.”

[jackh]

Do you stream anything illegally though? Films, football, etc?

Football would be the only thing - just the small handful of our games per season that aren't televised.

[jackh]

Found this Guardian article (though presumably just a report on a BPI press release) a bit disappointing, considering their positive coverage that I've linked to above: https://www.theguardian.com/business/2021/jan/04/uk-music-streaming-hits-a-high-note-amid-the-lows-of-covid

Good to know that the labels, and the likes of Lewis Capaldi, Dua Lipa, and Harry Styles are doing alright.

[rob1966]

I mainly listen to Planet Rock during the day, what I can find on Prime or just to the CD's I have bought. I did used to pay to stream but I found I tended to listen to the same songs over and over, so wasn't getting the benefit. I've got tons of music on my phone too, so that and Planet Rock seems to do for me.

I still like to own a physical copy, whether vinyl or CD and I won't change at my age. I don't buy that much these days, last year I bought a CCR compilation cd, bad company and Expectations by Katie Pruitt and have just bought Skeletons by Brothers Osbourne (starting to listen to Country Rock)

[elbow]

Bandcamp is a good option, or more specifically Bandcamp Friday where a higher percentage goes to the artist on purchases that day. I do use Spotify, but still purchase all forms of music from Juno, Bandcamp etc.

Interestingly enough, The KLF have suddenly made their back catalogue available on Spotify. It's never been available anywhere since they deleted it over 25 years ago.

[Ziltoid]

Spotify is a life saver for me as I walk around 2 and a half hours each day.  I have 9,000 songs "liked" which I put in alphabetical order and hit play (I reckon about 2,000 of those I already have on physical copy).  I have found new artists on there but would u then go out and buy a physical copy of the music - very much doubt it nor see them in concert unless they are absolute standout (which would be difficult after seeing Rush in concert over the years).  Now I'm concentrating on seeing artists that I've followed for a long time but not seen (Joe Satriani/Manics) and bands that I want to see at least once in my lifetime (Rammstein) lined up this year if we get over this virus.

[jackh]

Choosing to bump this, as I can see that some of the discussion in the concerts & gigs thread had touched upon this topic - hope people don't mind me taking the liberty of doing so!

I was thinking earlier today that there will be many bands that won’t make it through this pandemic because there is no way to earn a proper living from Spotify split 5 ways and no live shows that boost the coffers. Some of the best young bands will be fucked before they even get going, no small venues for them to develop in.

I saw Gary Numan on TV the other day saying how one of his songs was streamed over a million times and he made the princely sum of £37 from it. 

IN an interview he gave to Sky, he said he got the figure from the streaming statement itself. From what he says, the huge bands make money, but smaller artists don't. Its from this bit of the interview

Numan is not appearing at the inquiry, but gave his thoughts on the revenue from streaming in an interview with Sky News - putting the figures into context.

"The solution's simple," he said. "The streaming companies should pay more money. They're getting it for nothing.

"I had a statement a while back and one of my songs had had over a million plays, million streams, and it was £37. I got £37 from a million streams."

Giving another example, Numan continued: "I printed out, I think it was about a year ago, a statement - my streaming statement came in and I didn't look at it, I just put it to print, and I looked over about half an hour later, it was still printing.

"It was hundreds and hundreds of pages. And the end of it was, like, £112. It was barely worth the [paper] it was printed on, and it took nearly half an hour to print. You know, it's so much stuff, so much streaming, and there's absolutely nothing in it."

https://news.sky.com/story/gary-numan-one-of-my-songs-got-over-a-million-streams-i-got-37-12192462

In the good old days you would get £58 for each play on Radio 1, with maybe 10 million listeners. It is not the same as physical sales if it is just listens. But I feel his pain in terms of what looks like tiny payments for large numbers of plays. Bear in mind that some songs have 500 million plus plays.

I've no idea of how accurate his numbers are, but the fella is probably the most straight-up honest guy I've ever come across. As Rob posted, he got those figures from his streaming statement that was sent to him.

[jackh]

The DCMS Committee inquiry is ongoing...

MP says record boss 'in cloud cuckoo land' over music streaming claims

John Nicolson responds to Universal Music UK chair after he says artists ‘very happy’ with payments

https://www.theguardian.com/music/2021/jan/19/mp-john-nicolson-says-record-boss-in-cloud-cuckoo-land-over-music-streaming-claims

Spoiler

The boss of a major record label has been described as “living in cloud cuckoo land” after he claimed artists were happy with the music streaming model.

The heads of three major labels – Universal, Sony Music and Warner Music Group – gave evidence before the digital, culture, media and sport (DCMS) committee inquiry into the economics of music streaming, in often testy exchanges about whether the model was fair.

Universal Music UK’s chairman and chief executive, David Joseph, told the inquiry that artists were “very happy with the investment, very happy with advances” they currently received, before the SNP MP John Nicolson interrupted, saying: “I think you’re living in cloud cuckoo land here if you really believe that.”

Joseph also refused to answer a question about whether the lower royalty fees his label agreed with Spotify as part of a multi-year deal in 2017 had affected artists.

After he claimed he couldn’t answer the question because it would reveal information that could give his competitors an advantage, the committee chair, Julian Knight, intervened and directed him to answer. After being pushed, he said that the label had “increased the amount” it paid to artists as a result of streaming deals.

Jason Iley, the chairman and chief executive of Sony Music UK, and Tony Harlow, the chairman and chief executive of Warner Music UK, also gave evidence, with Iley saying 80% of his company’s revenue currently comes from streaming and that £190m has been spent on talent scouting and the artistic development of recording artists, known as A&R.

The label bosses appeared in front of the inquiry after earlier sessions in which MPs had heard from musicians who painted a bleak picture of the streaming industry at present. Established artists told the inquiry they were struggling to make money now that touring revenues had stopped due to the pandemic.

The Conservative MP Steve Brine discussed the evidence given by Nadine Shah at an earlier session in which she said that despite being a successful, critically respected artist, she was finding it difficult to make ends meet.

He said: “We can dance around these issues as many times as we want but the bottom line is successful artists can’t afford to pay their rent. There’s something going wrong, surely.”

Joseph responded by saying some artists who relied on the live circuit had been hit hard by the pandemic but that it was “not logical” that lost revenue would be instantly replaced by streaming. “That was never how their earnings were shaped,” he added.

The three record bosses claimed that they were huge investors in British musical talent via their A&R spend, while arguing that more regulation of the streaming industry would be counterproductive.

Harlow said streaming was “an evolving situation” that was being well governed, adding that any change or disruption could “diminish UK competitiveness”.

Before the session, the BPI, which represents the three major labels, released data it claimed showed that of the money labels received from Spotify subscriptions, the vast majority was put back into the industry via A&R.

Nicolson questioned that argument and claimed that Warner Music had given out more to passive investors than had been spent on artist development. Harlow said that was inaccurate and that in 2020 the company had spent $1.15bn (£840m) on A&R globally, with dividends totalling $280m.

The inquiry continues and will hear from streaming services, such as Spotify. The aim of the hearings is to establish whether the streaming models are “fair to the writers and performers who provide the material”.

[close]

[rob1966]

When you see the likes of Numan saying he earned £37 from a million streams of a song, you realise how so many artists are being ripped off. The musicians are struggling as it is, especially the up and coming ones, due to covid and Brexit destroying the merchandise side of the business, so if they cannot earn money, they are going to eventually give it up.

[SamAteTheRedAcid]

so if they cannot earn money, they are going to eventually give it up.

And in the end, it will only be musicians who can afford not to earn (i.e those rich parents) who can continue. As has already happened in journalism and many other fields. It's always been an advantage, but the gap is getting worse and worse.

Spotify is awful. Everyone should ditch it. Or, if you can't, try and buy some actual music as directly as possible e.g. buy from record label or artist directly.

[CraigDS]

Hasn’t being an up and coming musician always been a notoriously poor “job”? Years and years prior to streaming was a thing?

[Crosby Nick]

Hasn’t being an up and coming musician always been a notoriously poor “job”? Years and years prior to streaming was a thing?

At least you could possibly make a bit of money through touring. And increasing your fanbase and more sales off the back of it.

[jackh]

Hasn’t being an up and coming musician always been a notoriously poor “job”? Years and years prior to streaming was a thing?

Depends what your definition of "up & coming" is, I suppose.  I think there are plenty of artists out there who can feel aggrieved at having their means of earning a living undercut and made more difficult by the  devaluing of the 'product' of their work.

[CraigDS]

At least you could possibly make a bit of money through touring. And increasing your fanbase and more sales off the back of it.

Agreed on the touring part.

However you could probably argue the increased exposure to new artists via streaming replaces some of that at least.

Not sure new artists ever made much off music sales initially due to the cost to actually manufacture them (CDs).

[jackh]

Agreed on the touring part.

However you could probably argue the increased exposure to new artists via streaming replaces some of that at least.

Not sure new artists ever made much off music sales initially due to the cost to actually manufacture them (CDs).

I'd agree on the potential for increased exposure to new/small artists, but not necessarily for new artists - presumably it becomes a bit of a needle in the haystack situation, and everyone's connectively probably makes it harder to establish a local, word-of-mouth foothold.

Following the #BrokenRecord campaign quite closely, it's also clear that 'streaming' as a concept isn't the 'villain' - it's the 'ecosystem' in which it exists, and its misuse by 'the powers that be'.

[rk1]

The physical mechanism of selling CDs and vinyl simply isn't there now the major chains are dead and the high street in general is in decline.

Not true. CDs are not selling as the product has been superceded first by downloading and now by streaming. As a format its declining year on year between 12-20% in sales.

For vinyl, the opposite is true. Demand is outstripping supply. There is not enough global capacity to satisfy manufacturing demand. Demand has incresed due to more indie shops, more online outlets and in the USA, Target are now stock vinyl and even have their own exclusive product made for them

[Sheer Magnetism]

When you see the likes of Numan saying he earned £37 from a million streams of a song, you realise how so many artists are being ripped off. The musicians are struggling as it is, especially the up and coming ones, due to covid and Brexit destroying the merchandise side of the business, so if they cannot earn money, they are going to eventually give it up.

Numan is clearly talking bollocks. There is a royalty calculator by the way: https://www.musicgateway.com/royalties-calculator

A million streams gets you £3,440, which still isn't much but it's a lot more than £37. You're generally right otherwise though. If your income stream relies on touring and you aren't allowed to tour, you're screwed unless you have a decent publishing deal or side hustle of some kind.

[rob1966]

Numan is clearly talking bollocks. There is a royalty calculator by the way: https://www.musicgateway.com/royalties-calculator

A million streams gets you £3,440, which still isn't much but it's a lot more than £37. You're generally right otherwise though. If your income stream relies on touring and you aren't allowed to tour, you're screwed unless you have a decent publishing deal or side hustle of some kind.

I can't see why someone like Numan would lie, as its checkable. There is a disclaimer at the bottom that it is only a guide, an estimate and does not guarantee earnings. It won't take into account how the monies are actually split. You'd think that spotify etc pays more to access huge acts music than smaller niche acts

I'd assume that the royalties aren't paid the same across the board, acts who can fill stadiums, like Ed Sheeran, Metallica, Iron Maiden are going to get more than the likes of Numan or Fish, who were big for a bit in the late 70's/80's but then really just have a core following who have stayed loyal for decades?

Even if the Spotify figures are right, thats what 0.0034p per stream?

[jackh]

I can't see why someone like Numan would lie, as its checkable. There is a disclaimer at the bottom that it is only a guide, an estimate and does not guarantee earnings. It won't take into account how the monies are actually split. You'd think that spotify etc pays more to access huge acts music than smaller niche acts

I'd assume that the royalties aren't paid the same across the board, acts who can fill stadiums, like Ed Sheeran, Metallica, Iron Maiden are going to get more than the likes of Numan or Fish, who were big for a bit in the late 70's/80's but then really just have a core following who have stayed loyal for decades?

Even if the Spotify figures are right, thats what 0.0034p per stream?

Flimsy attempt at working it all out the other way coming up...

Let's say an 11-song album costs £11 to purchase on CD - £1 per song, with the artists taking (10-15%) 12.5% of that...12.5p per song.

32 plays - according to that calculator - lands Spotify on 11p and Apple Music on 14p, giving us an average of 12.5p.

I've got 11758 tracks loaded into my iTunes (I tend to buy the CDs and then convert to my iPod) - only 78 (seven albums-worth) of them (and what a banging playlist that would be  ) have been listened to 32 or more times (0.66% of them).

Returning to some familiar songs of a variety of albums probably means that's about four albums overall that (if I was streaming) I'd have helped break even, along with about 35 other songs, in the 11.5 years since August 2009 (when this iTunes database started).

(Totally aware that this is probably a holey calculation)

[d.arn]

Playing the Devil's Advocate here.

I used to work for a major label, back when streaming was really taking over and people were starting to pay for premium. I don't know what the royalties from the likes of Spotify are now, but back then they were pretty close to the levels from that website linked above. But what the artist got paid varied with the deal with the label, who of course keeps some of it. The label was at the time just coming to terms with how to economize this new medium. This was around 2014-2015, so they had just started to embrace it.

What many seem to forget, including some artists, is that with streaming artists get a continuous stream of payments for as long as the song gets played. Before streaming, both artists and their label would get paid handsomely in the first few months after the release of new music. But probably around 80% of sales of an album was in the first week, or so. So, they'd get one or two fucking massive checks, but when all their fans had purchased the album/single, the royalties would dry up until the next release.

Streaming, don't forget, was a massive worry for the labels as well a few years back. But they realized these economics and have instead focused on continuing making money from their catalogue. I mean, artists like Rod Stewart or The Monkees (don't ask me why these two came to mind first) or even artists like Prince weren't exactly cash-cows in 2008. All their fans already owned their popular material, or downloaded it for free, illegally.

Both Rod Stewart and Prince has around 9 millions unique listeners a month now (presumably streaming their songs more than once). So, we're talking many millions of streams each month. I'm sure Rod Stewart makes more of his catalogue in a few months today, than the release of his n:th album in 2007. His label certainly does, anyway. In short. Make memorable music and you'll earn pretty good money over the lifetime of your work. Mediocre artists, whether you define it in terms of hit potential or in terms of artistic quality, weren't getting rich back in the 90s either.

I will say though, as I really don't want to defend the major labels of the music industry, that while Spotify aren't paying huge numbers for each stream, you got to remember that the labels are still taking a pretty hefty part of whatever number Spotify mentions (or the numbers from that website above). Before streaming, they could motivate it by being the only ones able to mass-produce and mass-market physical records. Now, since the cost of reproduction is essentially zero and you instantly reach all markets once you post your song, they're taking a huge cut for basically posting a few Instagram-posts as marketing and lobbying Spotify to put it in their playlists.

[AndyMuller]

I hate this current trend of bigger artists abusing the streaming algorithms such as releasing an album in January and then releasing a super deluxe, magical, amazing version further down the year to boost sales. I find streaming to be bad as in artists release a lot of mediocre shite and flood the market with it yet it won't matter as the fanbase is too big therefore the streaming numbers will be huge. To be fair I haven't seen many bands do this tactic just a lot of rappers/singers.

[CraigDS]

I hate this current trend of bigger artists abusing the streaming algorithms such as releasing an album in January and then releasing a super deluxe, magical, amazing version further down the year to boost sales. I find streaming to be bad as in artists release a lot of mediocre shite and flood the market with it yet it won't matter as the fanbase is too big therefore the streaming numbers will be huge. To be fair I haven't seen many bands do this tactic just a lot of rappers/singers.

Isn’t that just the same as they used to do with CD’s (and prob tapes and vinyl before that) though? I know I’ve def bought an album on release only for there to be a Deluxe come out within the year.

[AndyMuller]

Isn’t that just the same as they used to do with CD’s (and prob tapes and vinyl before that) though? I know I’ve def bought an album on release only for there to be a Deluxe come out within the year.

It is I suppose but you have artists bringing an album out then months down the line bringing a deluxe version out with a whole new album of mediocre throwaways added on to it and calling it the same album but a deluxe version. It harps back to what I was saying about quantity over quality with the bigger artists. It's a tactic to keep getting high streaming numbers and to always be in the charts.