No easy answers

In The Guardian last month, David Byrne published "The internet will suck all creative content out of the world", a critique of music-streaming services like Spotify. In it, Byrne argues that the popularity of streaming "spells disaster for today's artists across the creative industries".

Byrne is an accomplished musician, blogger and author. His 2012 book, How Music Works, provides a sweeping overview of the ways that music shapes our lives, making his Guardian lament one worth considering.

Much of Byrne's concern is focused on Spotify, a music-streaming service that is available in the United States in one of three ways:

  • For free on desktop or laptop devicees, paid for by ads
  • Ad free for U.S. $4.99 a month on desktop or laptop devices
  • Ad free for U.S. $9.99 a month, on any device with the added ability to download music and listen offline

A fair share of Bryne's attention goes to the third option, a kind of "race to the bottom" that provides unlimited access to songs for a fixed price.

Although Byrne has taken steps to keep the music he does control off Spotify, he argues less strongly that other artists do so. He does wish for better terms – major record labels appear to pay about 15% of the roughly 70% of the revenue they get from streaming services, a rate that adds up to very little for many artists.

When I read posts like this one, I can usually find a point of entry to reframe the debate, but not this time. If anything, Byrne reminded me something I wrote for "The opportunity in abundance":

[Jane] McGonigal talks about building “superstructures” – a highly collaborative network built on top of existing groups and organizations. These superstructures bring together two or more different communities that don’t already work together to help solve a big, complex problem, what she labels “super-threats”, that no single existing organization can address on its own. The new entity harnesses the unique resources, skills and activities of its subgroups, but it is fundamentally new – an idea not tried before, an untested combination of people, skills and scales of work.

It seems clear that streaming services are popular among consumers. It also seems clear that these services need to create a win-win scenario for the artists who make the music they stream. Byrne rightly points out that the work done to date – in effect, adapting terms that were in place in the established model – provides little incentive for those creating the work.

Like Byrne, I don't have an answer, but I think the record labels (major and independent, alike) have a vested interest in convening the players to find a solution. It strikes me that labels, not artists, are at the greatest risk. Historically, they control catalogues of music, a set of rights that will persist for a certain amount of time.

That gives them a superior position today, but any artist could reasonably ask if they'd rather go directly to Spotify and get 70% of the revenue, or work through a label and take half of that or less. If labels don't act soon to demonstrate their value in support of an industry, they may encourage artists to make deals that eliminate labels entirely. That's a lesson that can be applied broadly.

Brian O'Leary

About Brian O'Leary

Founder and principal of Magellan Media Consulting, Brian O’Leary helps enterprises with media and publishing components capitalize on the power of content. A veteran of more than 30 years in the publishing industry and a prolific content producer himself, Brian leverages the breadth and depth of his experience to deliver innovative content solutions.

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