Streaming is the *new* law!

Streaming is the future present of music distribution, no matter who likes it and who doesn’t, that is a fact. And as such, there has been plenty of outcries both in favour and against it, the latest one being country music superstar Taylor Swift, who recently pulled her music out of Spotify claiming that low per-stream payouts were damaging and inconsiderate with the art she spent time crafting.

Polemic, to say the least, because the bigger picture says otherwise but hey, to each their own!

Photo by George Skidmore

remember that guy who sued Napster? Yeah, that went right…

We are in a phase of constant transition, as the interwebz continues to evolve becoming faster and broader (Rule 34) every time, and as such we need to look at how people are consuming media and what the best alternatives are to monetize in such behaviours. Piracy has hit a massive peak due to ease of access and this became the biggest issue music retailers had to face as it is now extremely easy to have access to any song or any album for free using torrent engines (I should definitely write a full entry on torrenting, because it is awesome!) and a bit of patience, I know it because I’ve done it a few times.

And here’s where streaming walks in and says: ‘Hey there young lads, I’m here to monetize y’all pretty pirates!’ -Spotify announced earlier in 2014 that it’s premium paid service had hit 10M subscribers and that’s a big deal, given that that number was only half just a year ago.

So, what’s the deal?

Simply put, streaming music is convenient for the consumer. You open the app, type in whatever you want to listen to and voila, you’re listening; no download times, no extra fees and payment processes to go through; plain and simple, you do everything at your own pace, whenever and wherever you want to. It’s brilliant from the consumer’s point of view: Massive amounts of content directly on demand for free (ad based, low quality audio) or for a relatively low fee ($9.99 a month) which gives access to all possible features, including third party apps that compliment the experience, shared playlists and high quality audio at no extra cost. Amazing value if you ask me!

How will streaming affect the industry?

Like I said before, it will take time to transition but it is the correct model, even if some artists think that they should still be selling songs and albums the same way we have been doing it for the last million* years. With piracy rates going off the roof, physical sales barely reaching marginal numbers and digital sales starting to decrease, it is pretty obvious that people prefer the convenience of streaming over the one way transaction for every song, it is a no-brainer based on value (or is it? more on this in a bit!) and convenience.

Some have mentioned higher priced tier-based systems, which are outrageous and are only thinking in their bank accounts, and while it is important for an artist to make a revenue on their art, fans are always more important because they are the ones giving them THAT revenue. A lot of people struggle economically and that situation should not be a factor in the access they have to music, specially if you can monetize it in any way. So, a minimum wage worker may not have money to buy new music, but the use of the ad-based free tier of a streaming service will deliver the same content, albeit with quality differences and interrupted, and the service is getting revenue from the advertisers. Making a payment mandatory would only yield two posible scenarios: one less fan due to lack of access, or the fan finding illegal access to still enjoy the content at no cost, giving the original artist no revenue, or even worse, giving it to a third party (ad-loaded piracy sites)

If you look at paid Spotify members ($120 a year) and the amount of music they can stream given the value, you’ll see that at 0.6 cents, one person can stream just under 20.000 songs a year which seems to be far more than anyone would stream (at that price, of course) but it also equals to only 12 albums at average price, one per month, perhaps? The funny thing is that unlimited access is attractive even when you don’t use it at all, 10 bucks for lots and lots of things that I won’t use? sure thing, but the average consumer spent less than $120 a year in new music all together. So the money is flowing now more than ever and a lot more people are jumping in by the minute.

Who benefits?

The services themselves, and artists with relatively large fan bases, initially; but the model is getting better and more open for smaller acts to promote and find new audience through their systems, so not all hope is lost and there is a bright future ahead for those willing to engage in a strong relationship with their fans. Open access to their catalog means more options to attract new fans and keep their current ones happy.

Bottom line

The bottom line is pretty simple, really. Streaming is here to stay and artists will have to adapt to the model, engage more with their fan base and find newer ways to promote their art! Most independent bands are finding massive success using crowd funding platforms like Kickstarter or IndieGogo to fund their projects, pre-selling both physical and digital copies of their records and giving fans the ultimate word and possibility to feel a part of each project. This is where we’re at. And it’s a better time than ever for the independent music business.


Click here to check Chaos Theory, my latest release and buy it on iTunes, Google Play, Amazon, or stream it on Spotify, Deezer, Rdio, etc.

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