I’ve bought thousands of LPs and CDs in my life, and a surprising number of them I only played once. Now I rent music from Rhapsody and Rdio – total cost $15 a month. In my heyday of buying CDs, I’d usually spend 10x that or more per month. I never got into stealing music. I want the artists and record producers to make their money like they deserve. However, it’s doubtful I’ll ever go back to buying CDs, and since I’ve acquired the streaming music habit, I have no desire to go back to buying music at all.
The question I’d like to know is: Can the artists and producers make as much money by streaming as they do by selling? Finding out about revenue from various music distribution sources is difficult, but there are some clues.
Problem #1 – Artists Used To Make a Lot of Money Off of Crappy Songs?
If I buy a CD for $15 and whether I play it once or a million times, the musicians and producers earn the same amount of money. If I go to iTunes and sample an album and buy one song I like for $1.29, again it doesn’t matter how many times I play the song, they’ve gotten their money.
Now if I go to Rhapsody and play an album or song, the artist and their record company will get a tiny payment, I assume. Now if I find one song that I love so much I play it 20 times a day for the entire month, that song should theoretically pay the creators of that song more money for my extra love. But does it pay the music people enough? Evidently not, according to The Black Keys, who have pulled their new album from streaming services.
I’m pretty sure selling CDs was the best way of making the most money. Music lovers had to buy everything pretty much on faith. The money was up front. Money from streaming comes after fans play the songs.
Problem #2 – Can Streaming Succeed if Too Many Groups Pull Their Catalogs?
Artists and record producers want to sell albums. But let’s be honest, how many albums in your collection are ones you like to play straight through and love all the songs? Or even half the songs? Or even one song? Music lovers want to find songs push their music loving brain cells into ecstasy. But we don’t know which songs do that until we play the album. In the old days you bought a CD and rushed home hoping to find at least one, and hopefully several great songs on an album. I’m through with that. Those days are over. I’ve been burned too many times. Streaming music lets me try out all the albums I want, and the songs I love get added to playlists. Life is easy, but will it last?
If music producers start pulling out of deals with the streaming music services it won’t. Now we could see a tiered delivery service like we see for movies and DVDs. Netflix is a cheap all you can eat service, but content comes there last. This might work for streaming music, where albums go on sale for a period of time before they go to streaming. I can dig that, but then I’m old and patient.
To get some idea what streaming music does offer, read “Spotify vs. Rdio: Who Has The Exclusives?” over at Wired. I wished Rhapsody had an API to let it be compared too because I feel from just daily use Rhapsody has the best catalog. What Wired did was look up 5,000 albums at both services to see which had the most. Rdio was the winner to me, but Spotify had some much loved exclusives.
It also revealed the holdout groups for streaming music: The Beatles, King Crimson, AC/DC, The Eagles, Led Zeppelin and Frank Zappa – but hell, I’ve already bought those, some more than once, some even three times. Streaming music still has millions of albums, so for $4.99-$9.99 it’s a great deal. But, how many groups have to pull their catalogs before people give up on streaming music?
Problem #3 – Can Artists Make Money Only On How Often a Song is Played?
To make money on streaming music services artists must create songs people want to play and play and play. If you create an album with 10 songs and people only play one of them, then 9 songs won’t be earning revenue. Streaming is a dog eat dog world of music competition. Hit songs will make money. But will they make the same kind of money as selling hit songs? I don’t know, and I can’t find out.
Problem #4 – Can the Music Industry Convince People to Buy Music Again
Because of stealing sharing songs free on the Internet, a whole generation feel music should be free. The convenience of streaming makes getting music for $5-10 a month far easier than stealing, so it might be a viable revenue stream, but can it compete with convincing people to buy music again? And now that I’ve spent years using streaming music, I don’t know if I’d want to go back to buying music. But then I’ve got 18,000+ songs I’ve already bought and I’m 60 years old, so I could coast awhile without buying. If I did go back to buying music I’d buy single songs at Amazon and hope Amazon stays in business for the rest of my life.
Problem #5 – What Happens if Most Fans Go With Streaming?
Even though I own the Beatles, Frank Zappa, Eagles and others on CDs, I no longer play their music. I went out and bought all the remastered Beatles CDs when they came out and then didn’t even play them. Streaming music is too convenient and great. I just don’t mess with my collection anymore. I recently uploaded it to Google Music, but I don’t play it. Spotify will call up my library when it can’t find it in theirs, and that’s cool, but I wished Rhapsody and Rdio did that. I want all my music in one place – in one search engine, and I want it in the cloud, so my playlists work from any computer or mobile device.
Sorry Black Keys, but I’m not going to buy your new album. Leaving Rhapsody and Rdio doesn’t make me want to go buy your album. My world of music is now streaming. If the song ain’t there it ain’t anywhere, at least in my musical reality.
Sources of Streaming Music News and Reviews
- Digital Music News
- Alltop – Streaming Music
- VentureBeat – Streaming Music
- Rhapsody Album of the Day
- Rdio Blog
- The Mog Blog
- Spotify Blog
JWH – 12/14/11