Den of the Cyphered Wolf

Sunday, October 13, 2013

Defense of Streaming 2 Electric Boogaloo

Just for the record since I am about to talk about copyright and music yes Vevo allows me to use that clip.

 Anyway time to shake my fist at opponents of streaming which I already did... twice.

Every now and again The New York Times will publish an article about how the artists are getting the screws put to them by the music streaming industry.


Before I go into full on rant mode let me make a few disclaimers. I am not defending piracy, I'm not decrying (I originally said extol. That's what I get for using big words I don't understand.) it as much as I should probably, but I honestly don't feel I have it in me to successfully argue that piracy is good for artists, maybe not as bad as the music industry makes out but not good. Also while I believe that it was a horrible system for consumers the complaint that iTunes has debundled singles is valid. They did and it means less money for artists and I can't fault them for feeling a little bitter about it.

More over while, I do feel they are acting against their long term interests I also can't fault artists for seeking the maximum royalty revenue they can.

Great now that I got that love train out of the way let's get started.

Overestimation Of Value
This is going to make me sound like an ass so I just will. When I read these articles I always get the feeling that these artists are over estimating how much they realistically should be making. That's not to say that I don't want them to get paid at all but not everybody is going to make Jay-Z money. People have an inflated sense of the money artists make not realizing that via traditional music sales  only a few artists actually are able to produce the sales numbers that generate that kind of revenue.

I am going to try to quantify this in a flawed way so here goes.  Right now on the Billboard 200, the lowest album is Lana Del Rey's Paradise. In it's opening week it sold 67,000 units. And that is a relatively indie EP.

Note it premiered at the 10 spot but again I can't deal with the long-tail effect or else I have to start going through things like Legend and Nevermind and the idea of doing that makes my brain hurt, though it would help another one of my arguments down the line.  If I were smart I would try to find or make a chart combining sales and weeks on the chart but brain hurtieness. Also Paradise was packaged with certain copies of Born to Die another one of Rey's albums which had much stronger sales so let's try another one.

Next up on the list is You Get What You Give by the Zac Brown Band aka the "Chicken Fried" guys. In its first week it sold 153,000 copies. To be fair it debuted at the one spot. Anyway, my point is unless you can sell at least 10,000 units in your first few weeks and consistently sell 1000 a week after that the traditional music industry model was not designed for you and that's low balling it. The labels won't invest, and even if they did both their and your return on investment would be pretty low.

Fragmentation of The Market
I'm not going to say that the internet hasn't hurt the music industry, but it didn't hurt it they way everybody claims it did. This is more of an explanation of my last point than a new one. Large cutural events don't happen the way they used to, including music.

Let me amend that. That was my thesis for this section until I started comparing everything, Nevermind, The Bodyguard soundtrack featuring Whitney Houston's signature song, The Eminem Show to Adele's 21 which is nuts. My gut is telling me that it is a crazy weird outlier but my theory definitely has holes.

Rather than going with my original plan and taking the top album of 2012 let's go with 2011... which is also 21. Oh goddamn it! Okay 2010. 2010.  Susan Boyle's I Dreamed A Dream. Selling roughly 3 million units that year.

Back to The Bodyguard, within a few months it went 6x platinum selling 6 million.

It should be also noted that it's entirely possible Whitney is also an outlier I choose the completely arbitrary number of 20 years ago but just dealing with Adele made my brain explode, though she does deserve the succes. Anyway this was only a small part of my much larger argument so I'm moving on. Generally the current music environment does not allow for the type of mega-celebrity it did previously, and individual artists probably aren't going to have the same sales figures as the 90s. God don't I miss 'em.

It's Not Distribution's Fault
I swear in a bit I'm going to talk about why streaming is good,  but my last two sections were my way of saying new business and distribution models are sometimes scapegoated for larger cultural and economic shifts.

So and so's albums aren't not making money because of Pandora, they aren't making money because we're in a recovery music is a luxury and on top of that people don't gravitate towards a couple of artists the way they used to.

Service Provided
Okay I know most of you have already turned away calling me a whiny crybaby by now. Let me tell you how streaming helps artists.

The reason why mass media, not just the music industry, but mass media, developed the way it did is because typically an artist does not have the means to promote and distribute their own content. As previously demonstrated the current business models of most mass media companies really on the "mass" to provide an economy of scale to justify the investment of the corporate infrastructure that enables the promotion and distribution of aforementioned content.

You had to press the record, truck it to the store, produce music videos, maybe have a late night commercial, book tours, book press interviews, not to mention studio equipment and talent cross pollination in the studio. God I hate colabos.

Now due to the internet a lot of this is superfluous in this day and age, but I don't care what industry you're in whether you're Bill Gates or a shoe shine boy connecting your product to the market is a huge headache.

10 years ago if I were going on a school camping trip and wanted some tunes I had to either choose my favorite CDs or bring and risk loosing my entire collection. Now on my lunch break if I feel like I can get most any song (except copyright fubars like The Beatles collection) I like via streaming services and digital music stores, from my phone. From Classic Jazz to Zydeco classics to the hot 100, to old school punk.

These services

  • Distribute music content to the consumer in a way that is inexpensive and convient
  • Do so in an organized visible way that caters to individuals musical taste better allowing people who might be interested in an artists music to actually be exposed to it. 
  • Allow information about artists and on occasion even upcoming performances to better allow for further engagement which as much as a sell out as I am starting to sound allows for more economic opportunity.  (You call yourself a punk Miles. For shame.)
  • Monetize that experience in a way other media dream they could, (I'm looking at you print journalism, online video, and television.) 

You know what was The Pandora of the 60's, 70's and even 90's.


Artists deserve to be paid for their work but, radio and radiolike services provide an essential service to the music community. Hell 60 years ago you would literally pay  DJs, because of the bump it got you in publicity and album sales.  I'm not saying payola was right but damn the shift is weird.

There is a reason why every music movie includes a scene where the artists go crazy when they hear their song.

Now until 5 years ago I can understand why instead of radio all the labels were courting MTV but MTV is no longer radio, but cooler. That mantel has passed to the internet.  Youtube music videos, digital distribution, digital press,  internet radio, twitter based fan clubs, targeted online advertising, this is the stuff you need to feed the machine.

However the higher the royalty rates go the harder it is for the machine.

It frustrates me because almost every other type of media is still figuring the internet out, when the music industry has the economic infrastructure to support itself and won't use it.  It has ways of promoting its content amongst the content sea that is the internet in a way bloggers and online video makers can only dream of. It has monetization mechanisms journalism should be envious of. It isn't being screwed by advertisers and Nielson the same way TV is i.e. digital sales of music actually count in measuring success and have for a long time.

And despite all of this the industry is still reluctant to use all that infrastructure in ways that may in fact doom said infrastructure to failure. The horse is out of the barn. If Vevo, BandsinTown, Itunes, Spotify, and Pandora fail, the public isn't going to go to Sam Goody; they're going to go to BitTorrent.

My Experience with Streaming
When I first went to college I for the first time in my life got my own debit card. This meant I could buy stuff not only without asking my folks but without them even knowing about it. You want to know what one of those purchases was.

Napster went legit. They had a good selection, and the music was organized in ways Best Buy could only dream of. I could sort search tracks by the name the artist and the discography. I remember on day I just had a blast listening to like 10 different versions of "Johnny B. Goode"

Heck I sill have Napster kind of. I even before they were bought out I also subscribed to Rhapsody because both services were cheap I could and for a while Rhapsody was the only place I could find The White Stripes. And Napster was the only place I could find the AfroPunk soundtrack.

And it burns the hell out of me that people are treating streaming as this new thing.

At the tail-end of high school VH1 started doing their I Love The X series. And I would hear about all these bands and artists I wanted to get into but knew next to nothing about. I didn't know enough about music to even really get started. All I knew was Will Smith and Disney. I kept hearing about some song, or band or album the guests would reminisce about and I would want to know what the deal was.

When I got to college cable wasn't as robust as it was at home so if I had some time to kill VH1's I Love the 70's would do.

And then Napster came along. I could search for the song, hear it, read an artist bio, and if I really wanted to get crazy listen to an entire album.

A Different Model 1.0

The reason why I took you back to '06 is that it burns me a bit that people think streaming is a new thing.  It's not it's just that when legal digital music distribution streaming lost its version of the betamax wars.

So at the turn of the millennium the internet happened. And Napster came along. And debates and discussions formulated about it.  Some of which are still being had. The consensus though was at the time downloading a song, and listening to it on the flashy new iPod was too convenient vs the old way of doing things not to expect the consumer to do it.

So the music industry tried a bunch of ways to make it less convenient. First being  litigation the big one being Napster and then Limewire.

Now here is where things get a little legally.

Before Napster there was an old ruling referred to the Betamax Ruling. Back when VCRs were new we had similar problems. Movie studios basically tried to sue VCRs out of existence. Long story short the court ruled that manufactures of technology aren't responsible for potential copyright infringment created as a result users action. You can't sue Broksonic because I taped Friends.

The Napster decision and for that matter Limewire turned that on its head.  A technology company had sucessfully been held responsible for the copyright infringement of its users.

Now the RIAA could have sued Apple and damn near every other mp3 manufacturer and crushed the Ipod in its infancy.

Realizing this the big dogs decided that if they wanted some cover, they needed to create and encourage non-infringing  methods of using their products.

My big angry pet peeve with Apple is they get credit for inventing everything even when they didn't.

Everybody was trying to figure this thing out.  Ultimately you ended up with two major services. Napster 2.0 and iTunes.

If you are reading this article you probably know what iTunes is and how it works. But for a while there was competition. Both of these services (Napster was bought out by Rhapsody) worked more or less the way they do now save smartphone nuttiness but with a one major caveat.

See back again the purpose of the iTunes store wasn't so much to turn a profit as much to provide Apple cover for any lawsuits regarding the iPod and copyright. So they made it so iTunes songs couldn't be copied. And for the sake of the business model Napster followed suit. Don't get me wrong you could copy purchased tracks on Napster but rented streaming stuff could only be listened to on certain compatible devices.

This frustrated consumers to no end, and eventually the idea of "my music" started to take hold. The idea of "I bought it I should be able to do what I want with it."  iTunes could begrudgingly change it's copy protection policy so that once you bought a song you could do what ever you wanted with it, but Napster and Rhapsody couldn't since their business model was more about renting the music. Once you stopped paying the monthly fee you were out of tunes.

And so by around 2008 streaming went out of vogue.

A Different Model 2.0

Look if you ask me why Spotify took off when it did, I have no clue. All I know is that Cnet and Twit were all of a sudden talking about streaming as if it were no longer the redheaded step child and I was thinking, but I never canceled my subscription to Napster or Rhapsody. I do all this stuff already!

I'm trying to put stuff together. Well Pandora happened. With streaming services prior you either had no know what you looking for, listen to a premade playlist or a theme station. The Music Genome Project which is basically the thing that makes Pandora work allows for automated music suggestions.

Facebook blew up and it let you share with friends in ways you couldn't. Yaaaay.

And it's free.  Which kills me because Napster tried limited free music in 2006! Anyway...

Until Spotify people had stopped paying attention to streaming. iTunes was king, and while there might have been a few pricing dust ups it worked more or less like a traditional music store so people understood it.

I don't think people understand streaming the same way.

Basically me in college, would pay about 10-15 bucks a month in return for that I would have access to basically a entire  very well cataloged music store.  As long as I payed I could listen to any song they had in stock when I wanted to.

The manager of the store would take notes to what I was listening to and then rather paying artists and labels based on what I buy would pay them based on what I listened to. Since I had to keep coming back to the store in the long term the manager makes more money than if I just bought what I wanted and left, I don't have to pay thousands of dollars at a time for my dream music collection, and artists who I like get paid more than usual because I tend to keep listening to my favorite songs. Seriously I have "Invaders Must Die" burned in my brain.

Now there are variations between all the services for instance Pandora and Spotify, both use ads in conjunction with tiered payment plans, but this is the gist.

Let me put it this way.  I started with these services in 2006  depending on circumstance I can say I spent about $10 a month on them.  That's $120 a year. Your typical iTunes guy spends $40 a year. Unless there is a mystical magical music boom you will make more money off of a streaming subscription customer than a itunes customer.

But the question is do the artists see that.


First of let me make this clear. The music industry has always and will always screw the artist. Unless you actually play and are not Lars Ulrich I do not believe any starving artist arguments coming from you.

Let me back away from that crass statement a little. Artists should be compensated for their work, but in the music industry actually delivering their music to the consumer takes multiple people and mechanisms. How much an artists ultimately takes away from their music should be based upon

  • The quality and success of the work i.e. How many people listen to it and how often
  • How much economic infrastructure it took to get that content to its audience i.e. distribution and promotion

Digital distribution dramatically increases both. I honestly believe that at the end of the day everybody. Labels, and artists will not only benefit from but will monetarily profit from these sorts of business models far more than they could from traditional album sales and that they create the type of musical culture and community that is engaged enough to put more money into things like live performances where a good chunk of the money comes from anyway.

Let me put it like this. This kind of bullshit  is wrong.  Not getting paid for a massive hit song that endures for decades.

Deciding not to put your record in a store because the store owner wants to keep some of the profit isn't wrong but it is insane. 

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