Is Music Streaming Good for the Artist?

Wolfman Uncategorized 5 Comments

The era of the Internet has brought many new opportunities in every imaginable area, as well as setbacks.  With respect to music, the multitude of social platforms, Internet radio stations, video sites, websites, and other Internet-related sites have given artists an affordable vehicle with which to expose their music.  On the other hand, it has also opened the doors for piracy and opportunistic ventures such as Spotify.

It’s obvious that Piracy harms the artist through reduced CD album sales and digital downloads; but what about music streaming sites?  Some weeks back, I was reading the 2014 NIELSEN MUSIC U.S. REPORT and there were some very interesting results; some of which have been trending over the past few years, and a couple of new ratings worth mentioning.  The key areas that caught my eye were:

  • ON-DEMAND STREAMING WAS UP 54% WITH 164 BILLION STREAMS IN 2014
  • Vinyl LP Sales Increase 52% and now comprise over 6% of physical album sales
  • Radio remains the top source for music discovery
  • Physical Album sales (CDs), Digital Album sales, and Digital track sales showed a continued decline

So, the first bullet point is a real eye opener.  R&B/Hip-Hop, Rock, and Pop were the top genres that people were streaming.  Why is on-demand streaming is so popular with these genres?  Could it be attributed to the ever growing popularity of mobile devices with the younger consumers who listen to these genres?  Or could it be that the consumer is no longer required to purchase and download the music?  In a PBS Newshour article, Rosanne Cash stated,

“It’s changed how we artists and musicians make a living. And, in 1999, the music industry was a $14 billion industry. Today, it’s half that. It’s valued at half that.
There’s a feeling now, a concept that music should be free, that it’s like oxygen, everyone should have access to it. Everyone should have access, but should it be free?”
She goes on to say, “For an 18-month period, I had 600,000 streams, and I was paid $104.”

It appears the Internet has created an entitlement attitude towards many things, including music.  I find it disturbing that this new mindset is growing.  How can anyone believe that music should be free? Perhaps [they] don’t realize that it wasn’t free to create?  I don’t know what the answer is; but one thing I do know is…if the artists pull their music from these sites, it may just reverse the declining course of album and track sales.  If the music is no longer available to stream; the only choices are to steal it or pay for it.  Simple!

On a positive note, the 2014 NIELSEN MUSIC U.S. REPORT indicated that Country consumers still prefer Albums and Track Downloads over Streams.  This is good news for many of the artists you will find here on the Wolf Pack Music website.

I am happy seeing Vinyl sales continue to grow.  In my teenage years, Vinyl and cassette tapes were the prevalent mediums for music…oh how I miss those days!

The last bullet mentions Radio as the top source for music and it mentioned that nearly 25% of all music listening happens in the car.  For Independent artists, it’s almost impossible to get their music played on the commercial radio stations here in the United States; however, with advances in technology, the newer cars are now equipped with Internet radio access.  Hopefully, this will level the playing field; but of course, only time will tell.  One thing I will say is, with commercial FM radio, the stations tend to play a limited selection of music.  IF, as someone who appreciates music, you would like to expand your horizons…have a listen to some Independent Radio stations, such as http://www.famemusicradio.com/ out of Johannesburg, South Africa.  You will be pleasantly surprised at what you have been missing.  It’s an “awakening”…much like discovering that elusive diamond in the rough.

Personally, I prefer to pay for the music.  I would rather own it and thank the musician for their creation through my purchases…hopefully, others will do the same.  It’s the right thing to do.

What are your thoughts with the ever changing music industry?  Are you happy?  Your comments are welcome and encouraged!

Wolfman

Comments 5

  1. great read yet very sad info… that’s not even a quarter of a penny per play. 600,000 x .0025 =1500… it actually breaks down to .00017333 per play it will take 5,770 plays to earn a penny at that rate. I am sorry knowing the high cost of advertising I would not let them play any thing I owned (If I was a musician). sometimes things have to experience stikes or in this case a boycott from the artists. In order to come back with a better deal for all players involved.

    Obviously it takes money to run the service and the artists deserves a paycheck while listeners either pay a premium to listen or put up with advertisers to pay little to nothing. The service can work but not in this manner.

    Having said that I stream a lot of music.. Mostly you tube from original artists (I like the video). Nut that’s because I am indoors with wifi at work all day in the past I was a contractor and there radio was my way since tapes and cd’s get messed up in that environment.

    Pirating is wrong and the best deterrent and the big boys know this is release your own music on pirate sites with malware and viruses attached

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      Author

      One thing that has been observed time and time again is that when people are given something for free, they start to expect other things to be given to them. Even animals have that reaction. I remember when a good friend of mine rescued a dog from the pound and during the first few months of having this new pet, it was a tough road. The dog was unruly to the point where 3 different animal trainers said nothing could be done to teach the dog to behave. But my friend never gave up on the dog and after 2 very tough years…the dog turned out to be his best friend and is well behaved now. So, how did he do this? Well, he made the dog “earn” his treats. He worked diligently with the dog to get him to obey his commands and when the dog obeyed; she was rewarded with a treat. But when the dog disobeyed…or lost control; there were no treats. Humans are no different…we should earn everything we have.

      As humans, when were are given something without having to earn it; a number of things happen:

      Initially, we appreciate it; but as more and more things are given to us, we start to expect more freebies
      We no longer appreciate what was given to us, because we didn’t earn it. In others words, the value is greatly diminished. We don’t think about what it cost in terms of time and money for the item to have been produced; it doesn’t even cross our minds!

      Just yesterday, I overheard a young gentlemen tipping a waitress and he apologized that he didn’t have more to give. The waitress was understanding and asked the young man if he had money to eat; because now she felt horrible getting this young man’s last bit of money for a tip. His reply was, don’t worry…I have food stamps. After all, they’re free!

      Now this young gentleman had a large diamond stud in each ear and he was wearing nice clothing. Obviously, he used his money for other unnecessary things and he certainly didn’t appreciate the value of food stamps and that mine and millions of other hard working American people’s tax dollars made it possible for him to receive those “free” food stamps. In my opinion, this is an abuse of our system that was intended to help people in need; but instead, healthy people such as this gentleman are taking advantage of the system and are outright robbing our nation. I could tell by his body language and reaction that he didn’t appreciate what was given to him; he simply expected it and most likely, will continue living his life expecting more free things.

      Getting back to Streaming music…I supposed an artist might consider it as more exposure for their music; but if the revenue isn’t coming in to support the time and expense required to make the music, is it worth it? Will you (as an artist) continue working a full-time job to pay for more studio time just to give more music away to an unappreciative audience?

      What if you made your music only available on select sites, such as your own website and a couple of other places? Would you sell more? Perhaps, because when you look at some of the things that people purchase and available only in certain stores…they command more money AND they sell their goods! It’s human nature to want something more when it’s difficult to come by…think about it.

      According to this blog post from a Lost in the 60’s titled “Concert Ticket Prices Skyrocket over Decades“, the author paid $2.50 to see the Beach Boys during the ’60s and taking into account inflation, those same tickets in 2011 should have been in the $17.50 to $25.00 price range; however, according to the post, they were “Much higher” at $110 per seat plus fees.

      A little further down, he mentioned a friend of his was paying $9.50 to see Bruce Springsteen in 1980; but in 2009, the price of a ticket was $95.00 plus fees, which can be as high as $20 per seat. Additionally, the merchandise at the shows went up considerably as well.

      Now, if you look at the Pollstar averages, you will see that they are lower; but that is an average from all shows. If you look at the popular bands, their prices are much higher. My co-worker told me she wanted to see Beyonce at the Rose Bowl recently; until she saw the $380 price tag in the standing section. This Wall Street Journal article examines the 10 most expensive shows in 2013 and the prices people were paying to see the shows.

      There are many reasons why tickets are sharply more expensive now compared to the previous 30 years; but according to this InternetFM article, “Things were different then of course – touring was done mainly to promote record sales and tickets were priced below market purposely to make sure shows were safely sold out and to reward fans for their record-buying loyalty. This produced what economists call a consumer surplus. Some of that surplus was soaked up by the secondary ticketing market.

      Then things changed last decade as recorded music revenue declined, bands toured more, and ticket prices went up – dramatically. According to Pollstar, in 2000 the average ticket prices was $41. In 2008, it was $67 – a 40% increase in just 8 years.

      None of these articles mentioned the effect that Streaming may be having on the prices of concert tickets; probably because it is a fairly new technology and there may not be any data to support speculation. Considering that musicians are a business that must generate revenues to keep doing what they do, I can only speculate that if Steaming is contributing to lower Album and track sales, that loss of revenue has to be made up elsewhere and of course, there aren’t many options except to charge higher ticket prices for concerts. For the bigger and most popular acts, this probably is a realistic option; but for smaller Independent acts, can they command higher ticket prices? Probably not.

      If I were a musician, I would seriously consider limiting the places where people could hear and purchase my music. It seems that when we make something impossible or more difficult to acquire…people naturally want it more. We see it in every day life. What if the musician pulled all their music from streaming sites and put out 30-60 second clips on their website for people to get a “taste” of what to expect? If the listener liked what they heard…they would have a couple of options where they could purchase a physical copy or a digital download of the album or track.

      One thing that is apparent is the revenues artists receive from streaming is negligible based on the data I have seen and simply cannot support new music. I hope people comment on the blog post…it’s a worth while discussion.

  2. I’m writing this as an old school artist/performer. Today everybody is trying to get into the music business. Your next door neighbor knows how to play some kind of instrument and has written the next great song for Kenny Chesnee, or Marandra Lambert. LOL. I think this balloon of artist and writers started when the Beatles, Stones ect hit the music scene. I feel if you go back to the late 50’s and early 60’s you can find many musicians but the technology for recording was not available. I can’t say the quality is as professional, but today anyone can own a home studio or video recorder. Small studio themselves have popped up every where. I have one myself I use for writing. Now getting back into the late 50’s and 60’s many bands, what they call garage bands now, popped up. These bands didn’t play for free, at least the one’s I was in didn’t. The venues, bars, lounges, high school dances ect., payed a fair price to the bands for playing. Now in just about any town or city you go too has open mic nights and you play for free. Even the groups are payed very little because there are so many artist (bands, groups) in the mix. The artist and/or band justify playing by saying it for exposure. True they do get exposure but in most cases your playing to the same crowd every night. The record labels have their scouts and agents just like any sports team. If your lucky you may find one of these people out once or twice a month listening. If they do hear something they like they will approach you and set up a meeting in their office. I’m not saying it can’t happen but the chances are maybe 1 out of 10 or less.

    Skipping around a little, my thoughts on the sale of music. There use to be vinyl albums and 45’s. With 45’s you had an A side and B side, usually the A was the hit song and the B was just to use on the other side LOL. Both came off of the album of say 11,12 or 13 songs. Generally there was just two songs used off of and album. If you wanted any of the other songs on the album you had to purchase the full album. This brought the sales of albums up. Today you don’t have to buy the whole CD you can just purchase the song you want. This is good for the consumer but it hurts the artist for royalties. Sure I don’t mind people buying just one of my songs, but it would be more gratifying to sell the complete CD. It cost the artist to record each song and just purchasing one doesn’t pay the expenses for one album.

    I don’t mind the radio stations, internet or commercial streaming the song of an artist. It is the best exposure in the market right now. You do have more potential customers listening to radio then some 25 to 50 seat bar.

    I told you I could write a page all night LOL. A little history: I’m a staff musician and a member of the musicians union. This happened when we made our first recording and I’ve stayed active every since. At that time the early and middle 60’s there was a war called Viet Nam. Many musicians were joining the reserves so they wouldn’t have to go on active duty, though they did have to pull one weekend out of the month and two week during the summer. When these musicians pulled their time, others filled in if they had gigs. I was lucky enough to fill in on bass and guitar for different groups besides the one I was in. I had the pleasure of playing for Bryan Hyland, The Roemans and the CandyMen. Being a staff musician and union member gave me the opportunity to do this. I’m basically retired now but do get the occasion to fill in, in Nashville and the surrounding area here. I’m associated with some excellent musicians and studio in the Nashville area, who are on all my recording.

    Wolf, these are just some of my thoughts on the way the music industry is today and how much I think it has changed. You have to love it, and just bare with it. It’s hard to make a living at it unless you establish yourself with the right people.

    Thanks

    John Cotton

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      Author

      Oh yes…the good ‘ol days when you purchased a 45 or an LP; I do miss them. I agree that it is good for the consumer having the option of purchasing just the songs they like; but in the reports I’ve been reading, even individual track downloads, as cheap as they are, are even declining. I do like the idea of Internet radio, as they play a good mix of music; but the Streaming platforms like Spotify must have something to do with the decline in digital track sales…or maybe people are simply recording the songs they like on Sound Cloud?

      Something recent has contributed to the decline in downloads and the only thing I can think of John is that the listeners are getting the music they like…for free. Now if you’re an artist who just wants the exposure and doesn’t care about sales revenue; then these would be great platforms for them. But what if you depend on Album and track sales to continue recording new music? This is where I would probably limit the places one could buy my music if I were the artist.

      It would be tough to get your music heard…heck, it’s tough enough as it is. Like you said, everyone is making music now and the Internet is saturated with music. For me, someone who has invested in and purchased a lot of Indie music these past 7 years, I would like to do everything I can to help others discover this great music and hopefully, help the artists through increased sales. Unlike the big acts, Indie artists don’t have the PR people, publishers, publicists, managers, agents, etc., that the well-known artists have. BUT, we as the consumers who purchase and enjoy listening to their music…we can become their PR people. THAT is my hope…that everyone who listens to and purchases Independent music, will become the street teams for their favorite artists. Word of mouth and personal recommendations are very powerful forces and when an artist has hundreds of satisfied people recommending their music to their friends and family…this I think, is where the Indie artist can start to see the growth and recognition they deserve.

      I loved reading about the historical references John…good stuff! Thank you for your awesome insight and comments!

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