Let's Talk Music Industry, Streaming, and Piracy

"Why?" This is a question I ask myself far too often. I find that it's simplistic, effective, and can be answered in more than one way, especially for the music industry. The music industry is an industry that, in my opinion, needs some work. The copyright laws haven't caught up with the modern technology; the labels are still stuck back in the early days of music, and artists are not getting the royalties and paychecks they deserve. Although there are a handful of law makers and lawyers working on updating various copyright laws for the industry, there are still a variety of things you and me as consumers can do to help move this industry in the right direction.

The first thing I want to talk about is streaming. What is streaming? About Tech contributor and Digital Music Expert, Mark Harris, states, "[Streaming music or audio] is a way of delivering sound without the need to download files or different audio formats." If you haven't already noticed, streaming is extremely popular today. Why? Because you don't have to download audio files and because you can create a Spotify playlist on your home computer and then open it up at work the next morning and pick up right where you left off. One thing consumers have always wanted is simplicity, and they're getting exactly that with streaming. 

Before I continue, I don't want you to think that I hate streaming and that I look down on the various streaming companies. I, too, use streaming services like Spotify, Pandora, and Apple Music, but I do support artists in other ways. The streaming business model has forever changed the industry, and I think it's absolutely genius; however, not everything about it is genius. How royalties are paid to their rightful owners, for example. Let me ask you a few questions. Do you use a streaming service? Do you use them daily? Do you pay for a premium subscription, or are you strictly a freemium person? These streaming services have perfected the way on how consumers use the product, but they have not done so when it comes to paying the artist their royalties or a lot of the back end work. To get a better grasp on how big streaming audio has become over the past few years, here are a couple of facts about streaming and royalties:

1. The International Federation of the Phonographic Industry (IFPI) estimates that in 2013, digital music services grew 4.3 percent to $5.9 billion in revenue. "The increased revenue can be attributed to a larger number of users utilizing subscription services and sales from downloads," states Trevir Nath in his How Pandora And Spotify Pay Artists article.
2. "Pandora has 250 million+ users and a one million song library" (Nath, "How Pandora And Spotify Pay Artists").
3. "In 2014, performance rates were $.0014 for non-subscription [Pandora] users and $.0025 for subscribers" (Nath, "How Pandora And Spotify Pay Artists"). Let me clear this up. Basically, if you just used the free account Pandora offers, for each song that you listened to, Pandora paid that band/artist $.0014. (That's 14/1000 of a dollar!) And if you paid or subscribed to Pandora each month, Pandora paid the artist $.0025. (Again, that's 25/1000 of a dollar!)
4. "Since its inception in 2008, Spotify insists that royalties have been its largest expense, accounting for 70% of revenue and about $1 billion over a 5 year span. Per stream payments are estimated to be $.006 and $.0084 with royalty payments for premium subscribers being naturally higher. However with large overhead costs, the Swedish company is still estimated to gross $1.2 billion from its 10 million paying subscribers alone. As a result, Spotify has been recently valued at $8.3 billion" (Nath, "How Pandora And Spotify Pay Artists"). 
5. Zoe Keating is a musician from Northern California. She shared her royalty sheets, in detail, on her Tumblr blog back in 2012. "After her songs had been played more than 1.5 million times on Pandora over six months, she earned $1,652.74. On Spotify, 131,000 plays last year netted just $547.71, or an average of 0.42 cent a play" (Sisario, 2013, "As Music Streaming Grows, Royalties Slow to a Trickle"). Note: Recording anything "professionally" these days requires a lot of time and money. Some (if not most) professional recording studios charge rates of $1,000/hr.+. (This rate solely depends on the studio, so it could be more or it could be less.) So, for Zoe Keating to make $1,652.74 in six months is nothing. That's not even two hours of recording time at $1,000/hr. That doesn't count the bills, taxes, and other miscellaneous fees she has to pay in her everyday life. Would you be able to afford and continue making music when you're paying such a premium to record and produce your work, but only getting paid like 10/hrs/week internship at minimum wage?
1. There was a rumor that Lady Gaga received a check for $167 from Spotify for a few million plays. $167! That's it!
6. Spotify was just valued at $5.74 billion, and it's growing exponentially each and every day. How so? There are currently 60 million total users; 15 million of them pay for a subscription. There are 30 million songs available on Spotify and 20,000 new ones are added each and every day. (Source: 12 Interesting Spotify Statistics) You get the point... It's a lot, and it's only getting bigger.

As I mentioned before, streaming audio these days has changed the industry forever as you can easily see from the stats that are listed above for Spotify. The industry will continue to evolve and work streaming into the business model, but in order for it to become an even more suitable model for the bands, artists, songwriters, etc, something about it needs to change. As I stated before, how these companies pay the artists who are available via their platform is something that needs to change.

I used to advocate purchasing music quite a bit (and I still do to a certain extent). I once told friends, family, and myself that I would never utilize a service such as Spotify for the very reasons I mentioned before. As a musician myself, I have bills to pay, food to buy, and a college tuition to pay for. I've spent countless hours working on my craft, and I continue to better myself each and every day as a musician. Whether that be learning something as simple as opening up my digital audio workstation to advanced MIDI quantization and humanization techniques, I'm always working and bettering my craft of music. I have a gift and talent that many, many people wish they had, so I'm going to leverage my time and talents as best I can to utilize and share the music I create and knowledge I learn with the world. 

Yes, I spend countless hours (this is hundreds, if not thousands, of hours mastering my craft of music). I work 40 to 80 hours on one song. Yes, one three minute, "simple" song. Is that $1.29 that you pay going to break the bank? Probably not. Right off the top, the distribution company I go through takes 15% (some take more and some take less), which is $0.19. Not a lot, but every little bit counts, especially when you're a college student. So that leaves me with $1.10. For spending 40+ hours on one song and getting $1.10, that's poor. Remember, musicians have gear to purchase and maintain, producers, bandmates, managers, dancers (sometimes), stage managers, and various crew members they need to pay. $1.10 is really, in my opinion, bad.

Moving on. 

Being able to write and compose your own music is becoming almost too easy these days. All you need is a computer, a digital audio workstation, and a little bit of music theory knowledge... if that. That being said, every person (including me) has/had that dream of becoming a big producer for Deadmau5, Lady Gaga, or Taylor Swift; however, that's not reality. The music industry is much like the NFL; tens of thousands of hopeful young adults poor their heart and souls into college football, but only a tiny sliver of them are drafted - the "elites," if you will. That same concept goes for the music industry. Thousands and thousands of talented people all over the world work on their craft for hours and hours and hours a day, only to remain unnoticed and manifest a SoundCloud following of 35 "fans" (bots in my case, haha!) after a year of extraordinarily hard work. 

What I'm trying to say is that supporting an artist in any shape or form that you can means so much to us musicians. We work hard to perfect our craft and love for music, and it's so much more difficult for independent artists to make ends meet and "get their foot in the door." Major artists like Taylor Swift are really pushing to make streaming more profitable for artists, which is certainly a good thing. We're making progress, but we still have a long way to go. 

What're some things you can do to make this transition more promising for musicians?

Thanks for stopping by! 

Lennon
Student
Bachelor of Science, Music Production