Join The Discussion: Withholding Music From Spotify
"Spotify is good for consumers and bad for artists. It's up to you. As an artist on no budget I can't and will never pay for slapping myself in the face." wrote Diggi Dog
"If your "core fans" won't buy your records because they are on streaming sites, then they aren't your core fans," states Jason Parker
Yesterday's post by Scott Perry "On Withholding Music From Spotify & The New Economics Of Album Releases" has caused some smart and heated discussion.
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Dear Music Community,
I’m not sure if you received your local newspaper this week (Ours is distributed via automobile rather than horse and carriage, so I usually receive mine earlier than most), but this Thomas Edison fellow just invented a new device that is sure to shatter our livelihood and take away all of our jobs. I hear it’s called the phonograph.
I’d like to protest this device and I am looking for support from you. If Edison is able to steal my music and distribute it to my local town, who will ever want to see my one-man, Pyotr Ilyich Tchaikovsky cover act at our local saloon.
For now, to gain job stability, I am resigning from music to apprentice to one day become a milkman – as certainly, we’ll always need milk delivered directly to our doors.
Sincerely,
Chris
I thought the big issue with Spotify and streaming music sites over royalties was the contract agreement with the record label. It’s really popular to hate Spotify in favor of the artists, but how much an artist receives from Spotify is dependent on the contract the band has with their recording label. If they don’t like the royalty rate, they should complain to the label. Independent artists, unfortunately, are own their own until someone can create a collective to organize under.
It seems there will never be agreement on this. As a consumer and Spotify subscriber, I am very disappointed that artists withhold their music from the service. With some exceptions, this will only hurt an artist trying to get exposure. But I suppose they will earn the money back from download sales at least in the short term. Still, it stinks that many of us, who are dedicated music fans who actually pay for music are being forced to essentially pay twice while the pirates and the casual non-paying fans give nothing. I guess the last laugh is on the super fans whose loyalties are too often taken advantage of.
I had an amazing conversation with the folks from Spotify this morning, really helped me see all this from another angle. So I’m gonna play devil’s advocate — against myself!
I’ve been focused on my peer group, a set of hard-core music fans who are ultra-wired. And yes, their purchasing has focused more on the must-have releases, while their streaming consumption has increased.
BUT you have to realize that less than 1% of Americans use streaming services, so it is hard to tell what kind of impact streaming has truly had on purchasing habits for the country at large.
AND on top of this, streaming services are winning over age groups that have never spent a PENNY on music — you project the growth among the 20something music consumer by offering an easier, cleaner alternative to file sharing, and you can see the potential size of the market.
From what I was shown, keeping music off streaming services mainly leads to an increase in consumption via YouTube (which pays out less), P2P networks, and less savory streaming services.
And can you really measure what impact streaming has had on any of last year’s #1 sellers, or any release for that matter? Did Spotify’s 2011 chart topper, Foster the People, really suffer less sales because of more streams? Or were they able to get a larger fan base because of their ubiquity?
Conversations like this are happening at management and labels every day. How we move forward will be a delicate balance, since consumers are moving towards streaming models whether we like it or not.
The biggest challenge any of us have is to unilaterally foster the growth of this emerging revenue model, so that it grows from add-on revenue to being bigger than the revenue streams it will inevitably replace.
@Scott Perry. Great stuff! Worth a new article!
“From what I was shown” Can you share the data you have seen? Would love to lay my hands on this report.
I kicked and screamed against Spotify, but I’m over it now and plan on using it. Will the model succeed? not sure. But right now, I need exposure. Exposure can generate sales. No exposure doesn’t. And instead of paying $50K in promo to generate 50K to break even in Europe (11 markets) . . . how bout just give it away for free on Spotify? After all, right now, in the 12 countries that Spotify is active, there are 590 million internet users. Spotify currently has 12.5 million of those users. That’s less than 1%. It’s NOT accounting for that 95% of music that’s consumed illegally. Spotify ain’t the problem right now.
Great Points,
I had a similar experience (though I had to dig through tons of online data) to come to a similar conclusion (both as a consumer and an artist).
What I think Spotify is failing to realize, is that the way they work is so glaringly, deliberately different from the old model. Without a literal spoon feeding infograph cartoon (the kind you see on an airplane prior to takeoff) to explain to both consumer and artist how they actually work, we’re going to see ignorance, and backlash.
I’ll make a bold statement. 90% of people do not know how the service actually functions, pays out, and how it will grow. It’s not simple. But it makes sense once you understand it, and is actually exciting.
In the end, it could take a decade to get up to scale, maybe less, maybe more. However, if Spotify got more artists to champion the service, they would be it’s greatest asset. Right now it’s mexican standoff, and understandably so. People feel entitled on both sides. That’s a tough place to be, but I believe that transparent information can help smooth that over.
Sidenote, I don’t think Foster the People is a great example as they had a major label push. The Spotify spins they had there were driven by massive pr and marketing. Show a relatively unknown artist that used the service, and gained some traction and visibility and that would serve the purpose of proving that point better.
This is a great way to look at it!
It’s not for everyone, but this is the best example I’ve seen in a while of how it can help in regards to Return on Investment, and Cost of Acquisition of fans.
Be sure to read this update – Scott Perry Talks To Spotify: The Case FOR Day & Date Music Streaming https://www.hypebot.com/hypebot/2012/01/scott-perry-talks-to-spotify-the-case-for-day-date-music-streaming.html
Of course we all know that streaming music services have come to stay. Spotify is doing the right thing for me as a consumer: they provide as much music as possible for the lowest possible monthly fee. The only problem is that I am also a music artist (six CD albums on Spotify as artist Homeless Balloon), and when I put on my artist shoes, I want the monthly fee to be as high as possible, so I can get some income from my music 😉
As a fan, I go back and forth on this subject. I get frustrated when a favorite band(Black Keys) won’t put their album up so I can add it to a playlist & share it but I also understand it (and buy the album anyway). As an artist, I’ve seen my streams go up the more touring we’ve done. In some senses, a stream goes a lot farther than a download when you think of fans re-playing your song. Since streaming is still fairly new, I’m interested to see how the services get better in the artist favor as time goes on..