
Is the Era of Free Streaming Music Coming to an End? - tomkwok
http://pitchfork.com/features/article/9896-is-the-era-of-free-streaming-music-coming-to-an-end/
======
wanderr
Former Grooveshark employee here so my opinion might be highly biased but I
believe that the genie of free music is out of the bottle and there is no
putting it back in, whether that is fair or not, it's just reality. I don't
pretend that Grooveshark had anything to do with that change, we recognized
that it had already happened and tried to find a way forward for the industry.

Older people, especially those with money, will certainly pay for music either
by buying the music or paying for subscription services or both, and I don't
see that changing but kids, the ones who I know at least, won't pay for music
they can get for free, and they all know how to get it for free. Streaming
services try to bring that behavior into the light and at least try to
monetize it, but eliminating free streaming is only going to drive them back
to the shadows. I really think that efforts to stop people from listening to
music for free will be about as effective as prohibition or the war on drugs.

~~~
FussyZeus
They used to say the same thing about PC games until Valve came along with
Steam and made it easier and more convenient to buy games legally and
install/keep them updated and enjoy the network experience than it was to
download them illegally and steal them.

The music industry needs something they can really get behind that's good for
both the consumer AND the publisher, and I don't think any of the services
right now have really come out enough on top to say that's the one. I would
say the big contenders right now are Apple Music, Spotify, and Amazon Music.
We'll have to see what happens.

~~~
vanderZwan
What about bandcamp?

A few weeks ago I discovered the Analog Africa label[0], which is all about
old school afrobeats. The label lets me listen to any album for free on their
bandcamp page, puts in effort to track down the original artists, write great
liner notes and blog entries on the process[1], etc.

I don't think I've spent as much money on music as I have on this label in
ages.

So yes, I'm very much agreeing with Gabe Newell's claim that piracy is a
service problem.

[0] [http://analogafrica.bandcamp.com/](http://analogafrica.bandcamp.com/)

[1]
[http://analogafrica.blogspot.com/?view=classic](http://analogafrica.blogspot.com/?view=classic)

~~~
FussyZeus
It's a service problem that none of the current distributors of mainstream
music seem willing to solve.

~~~
vanderZwan
They're just trying to milk the old model as long as possible while _also_
having profits with the new one.

------
bambax
> _Before Napster, to hear whatever you wanted, whenever you wanted, you had
> to pay for it._

What?? Before Napster, we made tapes. I still have tons of them. We exchanged
tapes and copied them, and also we recorded the radio.

It was exactly like Napster, only much slower and complicated -- and also, in
a way, nicer, because putting a tape together was a form of expression.

I don't think free streaming can go away without being immediately replaced by
increased piracy, but we'll see.

~~~
tehrei
No, see, home-taping was illegal and in the physical world you can't break the
law as easily as in the lawless wasteland that is the internet.

~~~
karmajunkie
Home taping on analog media was not illegal. [1]

[1]
[https://en.wikipedia.org/wiki/Audio_Home_Recording_Act](https://en.wikipedia.org/wiki/Audio_Home_Recording_Act)

~~~
vonklaus
home taping killed music and it was illegal[0]

[0][https://en.m.wikipedia.org/wiki/Home_Taping_Is_Killing_Music](https://en.m.wikipedia.org/wiki/Home_Taping_Is_Killing_Music)

~~~
karmajunkie
Media campaign vs actual law.

~~~
NamTaf
More specifically, differing law in different countries.

~~~
karmajunkie
fair point, my original response was indeed US-centric.

------
aston
There are actually two big questions here that seem fairly tied together, but
practically speaking are totally separate when it comes music online.

    
    
      1. How much money should consumers/advertisers
         be charged for access or proximity to music?
      2. How much money should artists, publishing companies,
         record labels and other rightsholders be paid for
         that access?
    

Those two definitely seem related. As a theoretical floor on #2 the
rightsholders have lots of leverage and so should be able to negotiate for
fair (or better than fair) payouts from #1. As a theoretical ceiling on #2 you
shouldn't be able to pay out more money than you make from #1.

In reality, the actual floor on how much rightsholders get paid is only up for
negotiation if the music comes as a result of interactive streaming from music
provided by the rightsholders (read: Spotify). If it's internet radio, where
the user doesn't choose what they hear (non-interactive, read: Pandora) the
rate is set by Congress regardless of the business income or rightsholder
desires. And if it's user-generated content subject to the DMCA (read:
YouTube) there's no clear need to pay anything to the rightsholders (see
Grooveshark). So, there are tons of arguments about #2.

As far as #1 goes, there's never been a music company that got to million-user
scale and was long-term profitable, so clearly companies (and their investors)
are willing to send more money out the door than they make. Fixed-rate
subscriptions have a perverse property that your best users by engagement
metrics are your worst users financially--they cost you the most with all that
listening. Advertisement-based monetization matches consumption to revenue,
which is nice, but as Pandora and Spotify will both attest, the revenue from
ads thus far is way short of what they or the rightsholders would like.

So what to do? Talk about it in the press and see if you can get public outcry
to force someone to pay your company more?

~~~
gcr
How could we make #2 much, much higher than #1?

It sounds implausible, but I like the idea of some kind of subsidized access
to music.

~~~
toomuchtodo
1\. Government grants program

2\. Basic income

~~~
gcr
Government-subsidized access to music! Absolutely yes. What a fun idea.

~~~
toomuchtodo
Subsidizing music and the arts in general is no different then us pouring
money into NASA and the NIH.

~~~
mattkrause
In fact, we already do a little bit of that through the National Endowment for
the Arts, National Endowment for the Humanities, and various programs run by
the Library of Congress and the Smithsonian (among others).

In the 1930s, The Works Progress Administration did a lot of interesting
things with the arts. Some of it involved prettying up overpasses and federal
buildings, and some of it was much more ambitious, like the Federal Music
Project (
[https://en.wikipedia.org/wiki/Federal_Music_Project](https://en.wikipedia.org/wiki/Federal_Music_Project)
), which did everything from holding free concerts to recording and studying
various types of traditional american music.

~~~
TheOtherHobbes
All Western countries do this already. But most of the subsidy money goes to
non-popular "high" art - usually classical and/or academic.

But... back in the 1960s and 70s, and to a lesser extent in the 80s, access to
unemployment payments in the UK were much easier than they are now. And so a
lot of people used "the dole" as basic income while working on a music career.

As an informal system, it worked pretty well. The UK got a lot of tax money
from of the most successful musicians, and the entire sector brought in
significant international revenue.

It wouldn't work now because there's too much music being made, and too little
income from most of it.

You'll still get a handful of exceptional breakout YouTube stars. But you'll
get a much bigger mass of wannabes with no real prospects.

That's not necessarily bad, but it would be a first in history - instead of
bread and circuses, it's going to be laptops and social media.

------
zer00eyz
As someone who used to run fan clubs, and merchandise stores on line for
artists I have a fairly different take on this.

Music as an item you buy is DEAD. It has been dying since Napster, and no
amount of copy right law, or services is going to put that genie back in the
bottle. The tools available to artist now, make it even easier to "make"
music, you don't need a full studio any more. Artists are even starting to
think this way, watch Diplo and & Skrillex on Charley Rose:
[https://www.youtube.com/watch?v=Eb85hwOotts](https://www.youtube.com/watch?v=Eb85hwOotts)

How then, does a musiscian make money? Licensing, Concerts, t-shirts and
merchandise, an artist is now a brand. Its a brand that has the ability to
endorse and enhance other brands. Take a "fan club package", Membership, great
seats to a show, meet and greet and photo. All in its going to be between
800-2000 for 3 minutes with a top tier artist, a photo and a hand full of
tchotchkes. Heck there are artists that even get paid to show up and have
drinks: [http://www.gq.com/story/how-celebs-get-paid-for-club-
appeara...](http://www.gq.com/story/how-celebs-get-paid-for-club-appearances)

Here is the grim irony of all of this, the music industry did it to itself.
Long before "digital" was a thing touring and t-shirts was how an artist made
real money. A record labels creative accounting practices would likely leave
an artist with little to no cash from millions in sales. Now that you don't
need a label per-se to get distribution, and it isn't where your going to make
money anyway, there is less incentive to go that route at all. How many hip
hop acts have become successful off of pushing out mixtape at a steady clip?
Google will provide you a rather extensive list from several venues.

~~~
petra
>> The tools available to artist now, make it even easier to "make" music, you
don't need a full studio any more.

True for electronic music ,etc - but do you see it being true for
rock/acoustic/etc ?

~~~
zer00eyz
I have a good friend that does exactly this, he very much makes "modern folk
music", lots of acoustic guitar.

Regardless of what you think of Kesha, she went into a bathroom and recorded a
Bob Dylan cover.
[https://www.youtube.com/watch?v=mNCEV7ZSNFo](https://www.youtube.com/watch?v=mNCEV7ZSNFo)

[http://www.rollingstone.com/music/news/amnesty-
international...](http://www.rollingstone.com/music/news/amnesty-
international-unveils-bob-dylan-tribute-in-honor-of-its-50th-
anniversary-20111210#ixzz1gFw7oqrd)

------
xivzgrev
"A perpetual free option doesn’t make for a viable music industry"

People have been trained for almost 100 years (since radio) that music is free
but ad supported via radio. So thats bunk.

The industry is just pissed people wont buy $20 cds anymore. Suddenly people
had another option for on demand music with napster.

Here we are 17 years later and the industry still hasnt gotten over it. I
guess why shouldnt they - easiest money ever. But time to put big boy pants
back on.

I think ultimately key music services are going to collude or move in lockstep
to increase ad frequency. And frankly i think its smart to put the hottest
stuff behind a paywall / available only on subscription. Record labels are
essentiallly caught in this trap where you can go exclusive and reach a small
percent of audience or dont be exclusive and reach everyone. An artist could
go exclusive behind everyones paywall, now that would be interesting. Pandora
youtube spotify whatever - listen to taylor swift new album now thru
subscribing.

------
arcanus
Is the Era of free email coming to an end?

Is the Era of free GPS maps coming to an end?

Is the Era of free social networking coming to an end?

...I see no reason music is any different. Nothing is free, but ads and other
forms of monetization will win over subscription services.

~~~
adamnemecek
What are some other forms of monetization besides ads?

~~~
Matt3o12_
Market dominance can make you more money. This is why WhatsApp is worth $18
billion. This can often lead to ads but it can also be used to control a
market.

~~~
adamnemecek
Market dominance isn't a monetization strategy.

------
Unkechaug
No, but the era of exclusive content is ramping up. While it's not exactly the
same thing because it isn't free, you see the same behavior happening in the
video streaming industry. Sign deals of exclusivity for the most popular music
people will pay for, and get them hooked with a couple ad supported freebies
up front.

------
haywirez
I think we are about to enter a post-recording era relatively soon. Recordings
are not native to the medium we use to interact with music anymore. It's no
surprise that engagement levels are dropping together with the tolerated
prices in the market (selling files/access to files containing recordings).
The way to upset and bury the current industry will be to create tools that
let us move past this 20th century notion of music consumption - imagine for
example hosted song projects with interactivity baked in. The next 10 years
will be super interesting.

~~~
zer00eyz
I do agree with your statement about "hosted song projects with interactivity
baked in" but I don't think that will displace recordings.

I don't think we are headed to a post-recoring era. I think we are entering an
era of MORE recording than ever. What used to take a studio, and a bunch of
musicians, is now something you can do with a macbook, and a solid mic. The
combination of social media (Facebook, twitter, instagram) and distribution
platforms (youtube and soundcloud) not only lets one directly distribute but
promote, and interact. For a lot of people in the US this means that "startup
costs" to be a recording artist today are negligible.

On the consumption side, how often do you listen to music while engaged in a
visual or physical task? Going for a run, commuting to work, washing the
dishes, writing code... all settings where recorded music without interaction
is something thats easy to consume.

------
monkmartinez
No such thing as a free lunch :)

However, as long as FM radio is still a thing... "free streaming" music is not
going to end.

~~~
laurencei
But FM radio stations are supported by Ads that the radio stations play to
make the money - so whilst it is "free" \- it is through the use of Ads.

------
davidgerard
This is wishful thinking that the genie can be put back in the bottle, that
copying will become harder and that the good times will return to the major
record industry.

------
petra
One possibility: maybe having a streaming account would become luxury, a
status symbol ? teens "love" that shit. Especially now with music discovery
services, which greatly increase exposure to variety of music and make it
harder to piracy alternatives to compete.

Or does anybody see a piracy based service that compete with spotify on
selection, and easy of use ? how would such service look, technically ?

------
anexprogrammer
> Before Napster, to hear whatever you wanted, whenever you wanted, you had to
> pay for it

Huh? "Home Taping is Killing Music" Was the slogan on every LP and tape, and
played before every film, in the late 70s and 80s. It wasn't and it didn't. We
had crappy ghetto blasters with 2x speed twin tape decks from every Japanese
manufacturer designed for tape copying (not that anyone in their right mind
copied anything at fast speed). We'd record tracks off the Rock Show on the
radio and trade tapes in the playground. We'd borrow LPs to tape, regularly.
95% of my music was on copied tape. None of us could afford to buy all the
vinyl we wanted.

Then CD burners came along and copying was so much easier - long before
Napster. Just don't let the screensaver or print job kick in if you were on a
Windows PC as it'd wreck the burn.

2 generations have been used to having free music, despite what the streamers
may wish I doubt YT Red etc will make much of a dent. I'd imagine most will go
back to torrents, or step up from CD copying and trade libraries with friends.
Those likely to pay are those with Sonos or other home streaming hifi. If
streaming becomes difficult to access there'll be a YIFY/Popcorn Time type
site along any moment.

TL;DR Does the headline end with a question? The answer is no.

~~~
pessimizer
> Those likely to pay are those with Sonos or other home streaming hifi.

To be more specific, geriatric and upper middle class.

edit: I actually think that music torrenting is dying because habitual
torrenters all have all of the music that they want. The next logical step is
to spend $20 on a hard drive and give that entire collection to a friend. Or
$80 if you're a fiend for flacs.

~~~
ghaff
I'm not in the acquire a lot of new music demographic any longer, but I guess
I assume that people must trade their music collections around. I sure would
have in college with today's technology. I get that a lot of people use
streaming these days but when you can trade around a few thousand songs
basically for free..

------
tunesmith
The whole things was a technical example of moral hazard, and, if you believe
moral hazard is wrong, an actual cultural failure.

Using a business model that wasn't self-sufficient - whether VC money, or
loss-leader money, or similar - meant that easy streaming stoked a demand and
a sense of entitlement in the consumer. Then later, that sense of demand was
used as justification to say "Welp, I guess the genie is out of the bottle"
and then ask for songwriting organizations to agree to shit fees.

Moral hazard - a risky action was took, when the actual risk was borne by
those (the songwriters) other than the people taking the action (Spotify etc).

It's unethical. Saying so is not a failure to accept reality, of course it
happened, but it doesn't make it any more ethical. It was a cultural failure
and there's a huge counterfactual that is out there that people cannot easily
accept - the large amounts of quality, life-changing music that went
unwritten.

------
Animats
The end of pay streaming music may be coming to an end. The commercial music
streaming industry generates less US revenue than vinyl.

What would kill streaming music? A court decision against Google that made
them take down all pirated music, or pay vast amounts to the music industry.
As long as most music is on Youtube, not much else matters.

------
toast0
Even in the UK where you need to pay to watch over the air TV, FM radio is
free and has music. Choices are limited, and advertisements are invasive, but
it provides a baseline experience.

------
meeper16
I remember it beginning with a company called SeeqPod, those were the days!

------
mrep
Betteridge's law of headlines: "Any headline that ends in a question mark can
be answered by the word no"

I think he is missing the key point of advertised streaming too. It's just
plain old price discrimination. If there was no outlet for free advertised
streaming, than most people would simply just pirate it. This way, they are at
least making some money off of those people.

