Musicians versus Spotify: It’s about scale
When the audience for streaming music services grows, the money will flow.
Anthony Rue points me to a great article on The Quietus by Charles Ubaghs. It’s premise is simple: the current audience for streaming music services is tiny.
Coincidentally, after a conference call yesterday about a music panel, that included Hank Shocklee and Molly Wood, I found myself in thought and the idea of scale popped into my head. I swear that I had not yet seen Charles Ubaghs’ article until this morning.
My thoughts began with the idea that if Michael Jackson sold 29 million copies of his album Thriller in the USA, what were the other 220 million people buying? At the time, was 29 million albums the most you could sell to an audience of music fans? I believe so.
The music buying audience in the USA is small. This is probably true of most countries. As Ubaghs points out: …Spotify is not a globally mainstream platform. The last time Spotify officially released user numbers in April 2013, it announced 24 million global users, with six million of them paying subscribers. To put that into context, 47.7 million Brits (90% of the population) listened to radio in the third quarter of 2013. Apple announced in June that it now has 575 million active iTunes users. YouTube currently lists its monthly user numbers at one billion, with over six billion hours of video watched each month – that 2013 viewing figure is up 50% from 2012 – and it is officially the largest streaming music site in the world.
He also rightly says that what has happened in the interim is that music fans have switched from stealing to streaming.
The musicians who complain the loudest are looking down the wrong end of the telescope. Music fans have shown a preference for the digital music file, however it’s delivered, and musicians who understand that [see: Moby] have benefitted from meeting that demand.
If Spotify, Beats Music and YouTube Music manage to persuade 100 million people collectively, to switch from listening to free radio and instead paying $9.99 per month for access to unparalleled amounts of music that they control, there will be a lot of money swilling around.
Of course we’ll still hear complaints from musicians about how “they’re not getting paid enough,” and that’s because they are not addressing the real problem: they signed a recording contract.