Sales of vinyl records are up in the United States and I have a theory on why some of us are going analog.
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Entries in spotify (14)
So, most of you are probably aware of the recent changes that Spotify has made in regards to opening up its platform for developers to build apps upon. In March, the social music service will be opening up an app store to help app developers get paid for their hard work. Last week, I read a really interesting article on the Gaurdian titled Spotify: ‘We have to turn ourselves into the OS of music’.
As a heavy user of the free version of Spotify , I really love what they are doing for social music but there are few major problems that I feel will prevent it from becoming the OS of music.
You can’t read an article in the music press without tripping over somebody complaining about Spotify royalties. You’ve heard the chorus: Spotify is destroying what’s left of the CD market. It is cannibalizing iTunes. It is ripping off indie artists. And so on.
So, you think. Spotify must be pretty bad.
But is it?
Spotify: Millions of DJs
As a music fan, the growing number of free and subscription based streaming services can be a dream come true. Install Spotify (or Rdio, Mog, Slacker, Rhapsody, Deezer, etc.) on your computer, your mobile phone, your internet-enabled stereo, and you have instant access to pretty much all the music that’s out there. Build playlists, see what your friends are listening to, those services have become a great tool to discover and enjoy music. Amazing.
From the artists that create this abundance of music, there’s been a very mixed reaction. I strongly suggest you read this 2011 recap by Bandzoogle friend and Nashville music marketing genius Charles Alexander. In it, he links to many articles and posts about Spotify that give you a good sense of why so many are worried or pissed off about it. You can also read the comments section to any post about Spotify on Hypebot, or Digital Music News and you’ll see that very graphic language is often used.
The short version ?
Digital music caught the record labels off guard and smashed their business to pieces, and from the rubble new economic realities are emerging. In this new reality, most independent artists, especially those who are just starting out, should give their music away for free. Sound crazy? Maybe, but hear me out. It boils down to 3 main concepts.
A question was brought to my attention after a chat with a friend, and I’m not sure I have an answer… So of course, I’ll turn to you. It went something like this: Friend: Spotify and Rdio both seem to either limit your amount of free music or play ads. I guess I’ll have to switch back and forth between them. Me: Or you could just pay for one? Friend: We pay after we know it’s good. We listen for free. Isn’t that the new standard?
What does streaming mean to an independant artist? Is streaming worth the loss in income so more fans can listen to your music? Can you ever break even? Is it better to just ignore the whole deal?
This essay is neither for nor against subscription music services, and will focus on answering four questions. 1) What is the revenue potential for subscription music services? 2) What are the most likely rates per stream? 3) How much money can an artist expect to make from subscription music? 4) Is a compulsory rate a sustainable business model?
I’ve spent my teenage and adult life obsessing over my music collection. Meticulously arranging hand labelled tapes and CD’s was FUN, but when the same job arrived for mp3’s, it became a massive chore. But I still felt compelled to own something, and so I continued for many years, wasting hours arranging an mp3 collection I’d not paid for. I passionately argued that I’d always want to own what I listened to, until the Spotify mobile app made that notion extinct.
Nearly a decade ago, Rhapsody debuted its subscription music service.
Giving fans access to unlimited music for a monthly fee appeared to be the answer to the social epidemic of file-sharing that occurred, and yet they still seem indifferent towards it.
Rhapsody failed to break into the mainstream market, leaving critics to question if it ever will. Many companies including MOG, Rdio, Slacker, and Spotify have since entered the sector too, none of which have had better luck. While Apple’s iPhone gave services a second life, experts argue that they have failed to reach critical mass due to issues of consumer awareness, user retention, smartphone penetration, and software design.
One digital decade has ended and another has begun. Throughout these chaotic times, cloud-based music services have remained at the front of music industry discussions.
Are fans willing to pay a monthly fee to access unlimited music or will ownership carry on?
It has been argued that the era of à la carte music downloads is over – that the iTunes business model has been exhausted. Fans no longer desire to pay for each song or own them. Instead, they want to have access to everything for nothing – or, at least, a small fee.
Tech-companies like Spotify are betting that if they allow enough users to build music collections – for free – eventually, they will take ownership of their libraries and pay to access them through mobile devices. Meanwhile, rival services like Thumbplay Music, Rdio, and MOG offer limited to free trial periods. This raises a few important questions.
I used to think that when it came to listening to music, what I and everybody else wanted was simple. We wanted everything, now and forever, wherever we are. And if we enjoyed the process, we’ll pay for it too (honestly, we will). But this isn’t strictly the case.
Spotify Premium offers just this, but falters at one crucial point; it offers too much choice.
Choice Paralysis is that feeling of being offered everything at once, and not knowing what to choose. When every piece of music ever recorded is offered on a plate, solving the problem of what to choose is a pleasure for myself and many others (if you’re spending the time to read a music blog, that probably includes you).
At the dawn of a new decade, the digital music sector remains unchanged.
Spotify didn’t launch in 2010. If it had though, would we be different now? I think so. Had it been made available in the U.S., an iPod type moment could’ve occurred. It could’ve.
And it still could. I’m not saying this out of blind evangelism either. Looking at the social features of Spotify more closely, I’m starting to believe Daniel Ek’s proclamation that music will displace photos on Facebook in popularity. Photo sharing is the lifeblood of Facebook, as are games like FarmVille and CityVille. Status updates and link sharing also play a big role. We like to see what our friends (and strangers) are doing and hear what they’ve been up to. However, a large majority of people do little with their accounts.
2010 is - rather tragically - shaping up to be the year when Rock Stars (and old-industry millionaires) complain about the state of music on behalf of ‘the little people’.
Here are three examples: Peter Waterman, in an interview with The Times, said that Spotify was a terrible thing. It, he says
“devalue[s] our artists, they damage this country economically, culturally and morally”
Why’s that then, Pete?
“The big stars are a tiny percentage; the rest are broke, including a lot of well-known faces. Who is developing new talent? Without money, new acts are strangled before they mature. We all suffer.”
This, from the man who made a multi-million pound career of writing and producing ‘hits’ for soap stars
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