As streaming music services gain in popularity, who will foot the bill for music in a digital world?
"Compensating the artist is crucial,” said Spotify’s Jon Mitchell at this week’s Chinwag event which sought to answer the question of who would foot the bill for music in a digital world. “You’re not going to get massive new acts for nothing”, continued the sales director of the world’s favourite music streaming service.
When quizzed more about how Spotify’s model would compensate musicians, Mitchell surprised the audience by explaining that “the Premium model is going to get bigger”. This statement met some resistance from an audience of Spotify users, of whom only one would admit to having signed up to Spotify’s Premium, ad-free model.
Perhaps for this reason, Mitchell was forced to acknowledge that Spotify still had some work to do to “prove to people that there’s even more value to Premium”. As an example, Mitchell explained that access to pre-releases and exclusive content for Premium users will increase in the coming months.
In the meantime, Mitchell explained that “massive inroads” were being made on the ad-funded model, and stressed that with lead times of three to six months, industry observers should not forget that “this is not an overnight business”.
Picking up on this point, Richard Jacobs, head of radio at MediaCom, agreed that this is a fledgling sector and argued that if the smaller operators like Spotify and Last.fm are to succeed they will need to work collectively in the future to secure lucrative advertising contracts. Given the news earlier this week that Microsoft is preparing to launch a UK music streaming service to rival Spotify, this seems like very sound advice.
Getting back to the artists though, one panellist was not convinced that they are currently being suitably compensated. Helienne Lindvall, a musician and journalist responsible for the Behind The Music blog for the Guardian argued that the current model “is not working” and that smaller artists are slipping through the net.
Lindvall pointed out that the current practise of giving away free music to promote large scale tours and cash in on the resulting merchandising possibilities did not work for everyone. “Small artists who don’t make money out of merchandising suffer,” argued Lindvall. What’s more, “it costs money to tour when starting out,” she argued.
It was notable that Lindvall was the only musician on the panel. Her comments echo recent dissenting voices from within the independent sector of the record industry who argue that the free model and the promise of a direct connection between producers and consumers, assuring a constant cash flow, has not delivered the fruit that was once expected.
One such argument can be heard here where music critic Kodwo Eshun and Hyperdub label head Steve Goodman (Kode9) discuss Chris Anderson’s long tail theory which argued that the internet would be a guarantee for economic success, especially for independent producers beyond the mainstream. For Eshun and Goodman though the long tail theory has failed to deliver on the promised democratisation and rewards for all artists.
So who will pay the piper? “Fans are willing to support artists,” argued Lindvall. “But if they think the artists are being paid and they’re not, then that is a problem”.
