How much of an average salary do consumers actually spend on streaming?

Do you listen to your music on a top streaming platform like Apple Music or Spotify? Read about the financial and environmental impacts of streaming music.

Guest post by Chris Castle posted in MusicTechPolicy

I ran across an interesting 2019 study by researchers at the University of Glasgow (sorry Celtics fans) and the University of Oslo that takes a deep dive into streaming (summarized in this handy infographic). 

The research…shows that when plotted against the changing average salary of a US citizen over history, consumers were willing to pay roughly 4.83% of an average weekly salary in vinyl’s peak year of production in 1977, a price which slips down to roughly 1.22% of an average weekly salary in 2013, the peak of digital album sales.

The advent of streaming over the last decade, now means for just $9.99, or just over 1% of the current average weekly salary in the USA, consumers now have unlimited access to almost all of the recorded music ever released via platforms like Spotify, Apple Music, YouTube, Pandora, and Amazon.

And then there’s the environmental impact of streaming. MTP readers will recall that I’ve been on the “dirty data” tip for years and tried to discourage readers from accepting–and in my mind being deceived by–Big Tech’s misdirection play about being green. They dearly want you to believe that the what powers everything from Google searches, to YouTube videos, to Spotify streaming is magic elves running on golden flywheels transmitted over gossamer wings.

This study confirms what we’ve seen in other reporting on the pollution of data centers sucking down hydro power in states like Oregon (represented by anti-artist mainliner Senator Ron Wyden–coincidence?).  The study tells us:

“These figures seem to confirm the widespread notion that music digitalised is music dematerialised. The figures may even suggest that the rises of downloading and streaming are making music more environmentally friendly. But a very different picture emerges when we think about the energy used to power online music listening. Storing and processing music online uses a tremendous amount of resources and energy – which a high impact on the environment.”

It is possible to demonstrate this by translating the production of plastics and the generation of electricity (for storing and transmitting digital audio files) into greenhouse gas equivalents (GHGs).

The research shows GHGs of 140 million kilograms in 1977, 136 million kilograms in 1988, and 157 million in 2000. But by 2016 the generation of GHGs by storing and transmitting digital files for those listening to music online is estimated to be between 200 million kilograms and over 350 million kilograms in the US alone.

So it already fails on the S (due to horrendous treatment of creators) and it’s refusal to exercise pricing power even though consumers pay so little; and the G (given Spotify’s extreme control by Daniel Ek’s supervoting stock to the exclusion of shareholders). It also looks like Spotify also falls down on the E, too, with its polluting business model. No ESG ETF for Spotify?

Not likely. The greedy Stockholm syndrome exploits everyone.