Music streaming services need to focus on artists, consumers
The music industry has had to adapt to the Internet. Industry leaders have been forced to figure out how to best utilize the Internet and stop piracy due to increased access to music and music-sharing. Solutions include easy-to-use systems to purchase songs, such as iTunes. However, Spotify and the recent proliferation of music-streaming platforms have changed the business model once again, according to a recent article in The New York Times.
The concept of having free access to a large portion of popular music is appealing, not only to the cash-strapped college crowd of Carnegie Mellon but to anyone who wants more for less. However, the business model of unlimited free music access for users needs to be re-evaluated due to a minimal payout for artists.
Music-streaming platforms, such as Spotify and Pandora, pay the record companies on a per-listen basis. According to The New York Times, the payment artists receive from Spotify per play is between 0.5 and 0.7 cents, or between $5,000 and $7,000 per 1 million listens on the service. If this were an artist’s only source of income, it would not be sustainable, according to Hartwig Masuch, chief executive of BMG Rights Management.
The dynamic that artists, record companies, music distributors, and music listeners have with each other must be redefined in a world where streaming seems to be the future of not only the music industry, but the realm of personal information and content as well.
As a consumer, streaming music with no up-front cost is a great deal, since it allows people to easily discover new music and thus increase the consumer bases of individual artists. However, artists need to receive fair payment for the music they produce. If that remains the case, the system needs to change or people have to become more aware of the ethics of how they consume music.