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Thursday
Jul092015

Artists Have Had Enough: Music Needs Valuation

Apple’s statement that they would not be paying artists and the consequent backlash from performers like Taylor Swift has been generating a great deal of commentary regarding revenue from music streaming services in general. This article examines some of the issues relating to streaming, piracy, and the difficulties associated with profiting from recorded music in the digital age.

In response to Apple Music’s announcement that they would be withholding payment to artists during their ‘trial period,’ one prominent artist stood up to lead the dissent.  Taylor Swift announced she would not participate in an unfair system that trivializes the talent and hard work of the music community.  For years, independent artists have cried foul play at a system that almost completely inhibits musicians from reasonably capitalizing on years of hard work and literal fine-tuning.  Unfortunately, a big enough stick was yet to be swung until Ms. Swift spoke up in defiance of such unfair, but tragically commonplace practices.  Is Apple to blame for this lapse in good judgement?  Absolutely.  But the problem runs deeper than any one company. For years, society as a whole has failed to place the proper value on the music industry’s contribution to everyday life.  
As a child of the Digital Age, I’ve grown up watching a vast change in the way we as consumers seek out content.  For music, the shift has largely been based around new streaming technology.  I watched my father build out the first full-scale music streaming service in the mid 90’s with Virgin Entertainment.  The idea that an individual could seek out and consume music of their choosing via a digital channel was revolutionary. Streaming was beginning to take over our lives in ways never thought possible.  And with the arrival of mobile listening devices, new technology was needed to boost on demand music libraries to accommodate to increasing demand from consumers.  However, just as quickly as these new services could build out, so could alternatives that allowed listeners to circumvent paid download.  Napster, Limewire and many other platforms offered a new concept known as ‘file sharing’ that allowed listeners to obtain music copies for free.  These programs have caused the availability and access to pirated content to skyrocket over the past 10 years.  The increase in piracy has devastated the music industry as a whole, leading to numerous complex problems that could not possibly be explained in such a short article.  
Image via Associated Press 2014.
However, tension has continued to balloon in 2015, at a time when online piracy has reached record numbers. The RIAA, Motion Picture Association and many other national organizations have launched aggressive campaigns to warn consumers of the harmful consequences online piracy causes.  But is the message even received?  Figures like Sean Parker and Kim Dot Com are revered as Robinhood-esque revolutionaries, who take from the big bad record labels and give to the innocent, needy consumers.  While it is absolutely true that record labels and big name artists have taken significant revenue hits from a rise in online file sharing, what most consumers fail to realize is how devastating piracy has been to even the smallest of musicians. Streaming models have been forced to build out strategy to overcompensate for high rates of piracy, which in turn has alienated many independent artists from seeing benefit from streaming services.  It’s no surprise that many groups shun the idea of promoting their music via platforms like Spotify, Pandora, Deezer and now Apple Music.  
And the majority musicians affected by these changes are not bringing home a juicy 7 figure income.  In 2013, Northwestern University School of Law published a case study that surveyed over 5,000 musicians with a median income of just $18,000 USD. The study found that on average, only 6% of a musician’s income comes from recordings or royalties.  SIX PERCENT!  That means that the average musician barely makes more than $1,000 from recordings annually.  And when considering the high costs of studio time, mastering and distribution, a musician is lucky to end the year with an album in the black.  
Yet, despite outcry from musicians small and large, consumers have yet to adopt a renewed sense of value for the music industry.  What is the biggest complaint from users on Pandora?  Ads.  What about from Spotify users?  Ads.  To what do ads translate?  Revenue.  We as musicians need to encourage our fans to appreciate our craft by respecting our value to society, and not underscoring talent through illegal and morally corrupt methods.  This includes everyone from those in the big leagues with multi-million dollar contracts, to the local jam band saving up tips to fund their breakout EP.  Let’s work together to spread the message that our music is an incredible craft, but one with a monetary value.  

 

Dillon Roulet is an entrepreneur, freelance A&R consultant and musician.  He is the co-founder of Duplici Media, a consulting firm that explores new media channels to help promote and foster artist development.  Add him on Linkedin, Facebook and Twitter!

Artists Have Had Enough: Music Needs Valuation

Reader Comments (7)

To turn the free music "Titanic" around - because it is such a HUGE problem and has been allowed to be one for years now - it will take a HUGE revolution and solidarity among ALL artists - those who make little and those raking in millions. And that revolution would be this: remove all online content except from your own site and get paid via PayPal there. iTunes and the like (AND the consumers) are like spoiled brats - they get away with nonsense as long as they are allowed to. This revolution is possible if we ALL do it. Think about it - the "big guys" would have no more music to sell! The question is, do we artists REALLY want to get paid and really think our music is valuable? If so, then why do keep giving it away for free? We are taken advantage of because we allow ourselves to be. Remove the product from the "powers that be" and starve them. The root problem is that we no longer think stealing is evil - which is EXACTLY what iTunes and the like have made "legit.” We pay for EVERYTHING else in life. Stop giving your music away and then it won't be free! If the consumer wants it, they have to pay for it. Period. This is possible and will work. But it takes guts. Take down your work from all sites except your own (INCLUDING YouTube). Place excerpts only on your site. Full downloads only available via payment on your site. Simple. Re-teach and discipline the "spoiled brats" - let them know they can no longer steal - and they will either be petulant or submit. It's a chance worth taking. So many people say "I can't live without music" "I love music." Really? Then prove your love and value of music by paying for it.

July 10 | Unregistered CommenterLiz

Nobody cares now and likely never again. Music has become something people do for a hobby like model airplanes. There is simply no shortage of supply - 10 years ago 25,000 albums were released vs 100,000 albums in 2013. Add that to the existing catalog of every song ever recorded and the market place is swamped.
Musicians like myself are similar to addicts because we can't stop and will do it for free or very little pay -this will be exploited until the end of time.
If only the music community and business could unite and utilize some kind of collective bargaining or unionization, then we MIGHT have a chance against the gigantic tech companies Google, Apple, Amazon, etc. who make money off music with very little investment into the content producers. Greed rules our planet.
If you read all of this comment I hope you have more hope than I do.

July 10 | Unregistered CommenterRyan

One of the problems that piracy has caused (yet few seem to acknowledge, or even realize) is that since it has caused many people to believe that music should be free, many musicians, especially unknown ones, feel that they have to give their work away in order to get noticed, thereby continuing the cycle. As long as artists continue to bow to the pressure, believing that their work is monetarily valueless, consumers will continue to believe that art should be free. If we as artists wish to break this cycle, we need to band together, rich and poor, successful and unknown alike, and DEMAND to get paid for our hard work. When the so-called "fans" realize that the only way to get the art they want is to pay for it, they'll eventually do it. Piracy has pretty much always been illegal, and nothing anyone is doing right now is putting much of a dent in it. Streaming services like Pandora and Spotify pay fractions of a penny per stream, and that's pretty close to piracy, also. If we want to get paid what we're worth, we must stand together and DEMAND it! Don't play for free, don't give your recordings away for free, and force the streaming services to do away with the free subscriptions and pay us a fair rate. I mean, come on, most of us have worked years or even decades to get good enough to make decent art, and that is worth something. It's time to stop letting people tell us it's not.

July 11 | Unregistered CommenterDan

The expectation on the part of the music-consuming public that recorded music can and should be obtained for free or close to free (ie: $9 per month for unlimited streams paying the artist far less than one cent per stream) is now well established. Musicians have, by and large, bought into this. As long as musicians continue to upload music to streaming services with the expectation of little to no revenue (including youtube videos), the longer people will continue getting their music for free or close to free. That is the nature of a market. The streaming services (and the people with the $9/month Spotify accounts) argue that the wide exposure provided helps artists attract people to performances where the artist can make money. The question becomes, does recorded music have intrinsic value or is it now simply a necessary marketing/promotional tool to be used to attract live audiences? As a recording and performing musician for some forty years now, I believe the idea that recorded music has no intrinsic value is absurd. My next release will be a CD which I will make available only through my website, CD Baby and at live performances. I will put out one video with excerpts from four or five pieces so people can have a sample of what they are buying. None of it will be downloadable anywhere and I will publicize that. Beyond individual artists refusing to participate in their own devaluation, I believe an advertising campaign aimed at changing the expectations of the buying public might help persuade people to once again value recorded music appropriately.

July 11 | Unregistered CommenterMark

Absolutely agreed that we need a collective approach, whether as a union or some other collective approach.

However, this is only half the battle. We also need far strong intellectual property laws and enforcement. DMCA is a joke. Not just songs, but entire albums, are available free and illegally on iTunes, with millions and millions of views. All of this leads to lost income.

It's not enough for you as individual artist to pull your work from these sights and fight piracy through take-downs; this must be a concerted effort.

Musicians who willingly give away their music free are collaborators in their own demise, and traitors to their colleagues.

July 12 | Unregistered CommenterSasha

Yes, piracy is still a problem, but the real villains are the same old record labels. For every dollar that the record labels collect from streaming services only 25 cents goes to the artists while the labels keep the remaining 75 cents.
Without artists there would be no radio, no record companies and no MTV. Its time artists stood up for what is rightfully theirs. Artists should settle for nothing less then 50% of the profits generated by their music.

I have recently decided to not give my music to any streaming or online distributor. I'd love to take my tunes off iTunes but apparently it's impossible (?) Anyone know of a way to do this?

Since people don't want to pay for music, I decided to give mine away for free at the same time appealing to their humanity in hopes they might donate something. If anyone has suggestions on how to refine my approach, I'm all ears. The site is nofacejohn.com

noface john

July 27 | Unregistered Commenternoface john

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