Tag Archives: Music Industry

9.99

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MIDiA has an interesting post this month on a topic that’s been on my mind: the price point of 9.99 (dollars, Euro, or pounds) for subscription music services.

Streaming music is still on the rise, with 106.3 million subscribers in 2016 and a larger number expected in 2017 (thanks to factors like new services on the market, an expansion in the Chinese market, etc.). However, MIDiA expects this growth to slow down and reach a maturation phase by 2019.

How did we get to the magic number of 9.99? Much of it has to do with record label agreements. Labels negotiate with music providers so they get a certain cut for each play of their artists’ music. Providers have to price their services high enough that they actually turn a profit. As it turns out, 9.99 is what a lot of subscribers are willing to pay.

In order to prevent a stasis of subscriber numbers, I’m curious to see if subscription services are going to start playing around with different offers at different price points. Can a service charge more if they’re going to offer other perks, like early access to concert ticket sales? Can they offer niche subscriptions at a lower price point? (MIDiA mentions the Overflow, which is a Christian music service. I know there could also be a market for a classical music service with super clean metadata, but that market probably isn’t big enough to turn a profit.) Now that record labels are going full-bore with exclusives (see this great piece on The Ringer for an idea of my feelings re:exclusives), can streaming services offer an a la carte “exclusives only” option at, say, 2.99 a month so users can hear new music but stick to the 9.99 platform of their choice?

No matter what, I think we’re going to see some interesting innovations in streaming music over the next couple of years. Spotify may not be making money yet, but the rise in streaming music subscribers has services feeling confident enough to take some risks.

MediaNet Acquired by SOCAN

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If you’re reading this, you probably have heard my company’s big news by now: we’ve been acquired by the performing rights organization SOCAN. I hadn’t written anything about it until now because I’ve been traveling and jet-lagged, but I’m very excited about this development.

There’s a lot of talk in the industry about “transparency”, which I’ve written about before. SOCAN is working to make it easier for music content creators to track their payments, and the integration of our rich data into their business will get them there. As I’ve written before, we’re obsessive about data accuracy!

The refrain we hear a lot is that of the “black box” in the music industry. I don’t favor that term because it hints at nefarious, sleight-of-hand activities. While that may have been present in the past – the mob was involved in the industry, after all – I don’t think that’s the case today. There are just a lot of parties involved in the release of a recording.

Here is the quick explanation of music rights that friends sometimes ask me to give (after a couple of beers): When you listen to a song on a digital service, there are a lot of entities that are entitled to money. First, someone – or maybe a couple of someones – wrote the song, so they’re considered the songwriter. Their money is collected by a publishing company, which the songwriter may have established themselves, or maybe they asked an existing publisher to handle it for them. The songwriter is also represented by a performing rights organization (PRO), which is kind of like a songwriter’s union. (SOCAN is a PRO.) Next, you have a recording artist. This may be the same person as the songwriter, or it could be someone totally different. Maybe there’s a band, or studio musicians, so they all earned money on this play. In the traditional case, they have the backing of a record label, who signed a contract with them. This contract may have covered things like a cash advance to the recording artist so they could make a record. The label also handles things like touring, merchandise, and marketing for the artist. (They sometimes have a claim to some of that publishing income, but that’s a topic for a different day.) Maybe the label is a small one, so they rely on a distributor to get their music out into the world.

These entities all have contracts to get paid for the services they provide. These agreements are made behind closed doors, so – for instance – while a recording artist may know the terms of their contract with a record label, they aren’t a party to the contract between their record label and a streaming music service.

Some of this “black box”-ness is necessary, so it’s always going to be there. What we can – and should – fix, though, is the links between all the parties that should get paid through a play. There is currently no global rights database, so sometimes it’s not obvious who contributed to a recorded track. It’s the industry’s biggest problem, and it’s one we’re working to fix.

What Is Tidal’s Problem?

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Since Jay-Z relaunched his music streaming company Tidal in March, I’ve watched their progress with interest.

The streaming music market is a crowded space. In order to succeed, a business can’t simply be a “Me Too” service. It has to be easier to use, have more and/or exclusive content, have better features, be cheaper, or – even better – have more than one of these qualities.

Tidal has HD audio and some exclusive content. According to some, their interface is better than other services. That should be enough for them to at least have a small but dedicated user base, but I think there are two reasons they’re struggling (so much so that Jay-Z has forgotten about it): a) Higher price, and b) Mismanaged PR.

Today’s NY Times piece by Jon Caramanica hits the nail on the head when it comes to Tidal’s mismanaged PR woes:

“It’s hard to see Tidal as something other than an oligarchic hustle when it primarily engages in oligarchic behavior. At this show, Damian Marley was introduced as “the newest artist-owner of Tidal” — the room shrugged. People generally don’t root for corporations.”

Tracking Down Publishers

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Wall Street Journal’s Ethan Smith has a good piece today, written with admirable clarity, about some of the difficulties in tracking down publisher royalties. A proposed solution:

“The NMPA is contemplating a proposal simply to apportion the unclaimed royalties based on its members’ market share.”

I think it would be more productive to ask or compel record labels to share publisher/songwriter information for their recordings.

“Songwriter and publisher information isn’t typically included in the “metadata” that record companies include with songs when they upload them to services making it difficult for the service to know whom to pay.”

Labels do have this information for some (if not all) of their catalogs, but since they don’t have to share it, other companies have to piece it together. It would be helpful for services to have this information. In the meantime, companies like mine are working hard to track down every rights holder.

Moored Music

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“When Amazon Dies“, a recent piece in The Atlantic, is an interesting look at one of the biggest hurdles for converting “a la carte” (or “cloud”) service users to subscription streaming services:  Users want to keep the content they’ve purchased. But when a service goes away or an account is deactivated, any content that was saved “in the cloud” disappears too.

Other than books (which I read on my Kindle), I generally prefer subscription services to a la carte and download models for two reasons:

1.) Unlike a download or a la carte streaming service, paying a subscription rate allows you unlimited access to the service’s catalog. I currently have a Beats subscription, which has just about every album/artist/track I can think of. When that service goes away, I’ll be sad, but then I’ll subscribe to another service where I’ll have access to a catalog that is – to me, anyway – functionally the same. I won’t feel like my subscription was a sunk cost, because I’m paying for continued access to a broad catalog, rather than buying access to specific albums which may or may not remain available to me later.

2.) If you’re using an a la carte streaming service, there’s no guarantee your music will always be available to you. In fact, it’s not really “yours”. Depending on the service, Digital Rights Management (DRM) may be in effect. DRM can limit the number of devices to which you copy your music, and any retroactive changes in territory restrictions can mean content gets pulled from your cloud streaming library after a “takedown” is issued. Personally, I’d rather pay for a subscription service. If an album I want to listen to gets taken down, at least I didn’t pay for just that album.

The downside to switching services, however, is the thought of losing playlists. This one isn’t a big deal to me either, actually. I tend to listen to music while I’m working, so I’m a big fan of playlists that are “curated” by someone else, rather than ones I create. It’s nice to hear a variety music I enjoy without having to invest time into setting up the playlist. I may be an outlier – I know a lot of people enjoy crafting the perfect playlists for partying, studying, cleaning, etc.

I think the connection to our playlists goes deeper, though, than the time and thought we’ve put into them. To a large extent, the music we choose is part of our identities, especially when we share our tastes with others. Most people remember the first physical album/tape/CD they purchased. Everyone loves to play DJ at parties. Vinyl collecting has been enjoying a resurgence for years, partly because records can be arrayed on shelves in the living room for everyone to admire. When we lose that ability to curate and show off music, we lose part of that connection. Music becomes fully intangible.

So how do we incorporate an interest in media ownership into an increasingly digital world? Possibly a playlist-porting service like Soundiiz has potential, but I’d like it better if it was fully independent from any existing service – i.e., if it wasn’t owned by a streaming service.

Perhaps sharing what we’re listening to on social networks is the way of the future, but that’s exactly what put me off Spotify in the past. From what I remember, in Spotify’s early days, an account had to be linked with a social media account, and by default it would update your Facebook page with the music you’d been listening to. Beyond the added clutter, I never liked that feature because there was a whiff of trying-too-hard. It’s “cool” for people to accidentally notice you’re listening to Morton Feldman at work, or to casually mention you’re listening to the perennially-hip Miles Davis while cooking, or to namedrop on a blog. But when you’re developing the “perfect” playlist to push to the news feeds of all your friends, it’s just not interesting anymore. Plus, there’s always the chance of accidentally admitting Mariah Carey is sometimes your jam.

What’s the answer, then, to our ownership dilemma? I think it’s some combination of playlist portability and social media sharing, or possibly just one or the other, but with better execution than previous attempts. I think time will tell.

On Transparency

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When I defended my master’s thesis, one of my committee members took me to task for not providing my definition of the term “meter”. My thesis was about hypermeter, which – without getting too into the weeds – is the hearing of a piece’s meter on a larger, more structural scale. Meter, of course, is the alternation of strong and weak beats. Of course.

Right?

I never explicitly gave that definition in my thesis. I was stung by the criticism for a long time. While it was the central principal of my thesis, I knew my (small handful of) readers had a shared understanding of the term.

It dawned on me later what my committee member was getting at. It didn’t matter what meter already means to the reader. If I was going to be making strong arguments about something, I had to be very clear in my definition of the term. Especially if I was going to be using it repeatedly.

I’ve been reading Berklee School of Music’s report on transparency in the music industry. I haven’t finished it yet (because I have an upcoming music festival on my mind), but one of my first impressions is their reliance on the word “transparency”. What does that mean to them, exactly? Will it become the new buzzword in the industry? Will every company start to say they’re being transparent without actually changing anything? We need some real, achievable benchmarks.

I’m biased on this one because I think my company was ahead of the game. I work on our content team, and previously on our rights team. We work hard to attribute works to the correct composers and recording artists. We literally have people working on this issue around the world and around the clock. To read more about our definition of transparency – linking writing & recording credits at the source – check out my company’s recent Medium post.

I have lots of thoughts on the Berklee study, so I hope to do another post at some point! Stay tuned.

Welcome

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I decided to start a blog where I could post about music, specifically the areas that interest me most: music licensing, streaming services, digital content management, music theory, classical music performance, orchestration, pop music, etc. Mostly I’ll be writing about the music industry. The world doesn’t need another music blog, but here it is anyway!

The title is adapted from a lyric in Cab Calloway & Irving Mill’s “Minnie the Moocher”.

She had a million dollars’ worth of nickels and dimes,
She sat around and counted them all a million times.

I don’t necessarily think there are any moochers involved in the music industry – it’s much more complicated and nuanced than that – but it’s an allegation that’s bandied about frequently, so my use of that lyric is a little tongue-in-cheek. Mostly I chose it because it made me think of the per-play basis on which artists are paid for streaming music (as opposed to the old way, where downloads and physical media sales would yield flat-rate earnings).

If you’d like to learn more about me, click here.