A recent article by veteran US indie musician, Damon Krukowski (formerly of Galaxie 500) highlights the paucity of remuneration to artists from the popular internet radio-on-demand services Spotify and Pandora. While it has been common knowledge for some time—a well-circulated 2010 infographic calculated that an artist would need more than 4 million plays on Spotify to earn the minimum US monthly wage—the disconnect between music streamed from the cloud and money in an artist’s pocket has usually been demonstrated in hypotheticals. Instead, Krukowski generously opens the books on his own music with hard data one of from his former band’s best known tracks.
My BMI royalty check arrived recently, reporting songwriting earnings from the first quarter of 2012, and I was glad to see that our music is being listened to via these services. Galaxie 500’s ‘Tugboat’, for example, was played 7,800 times on Pandora that quarter, for which its three songwriters were paid a collective total of 21 cents, or seven cents each. Spotify pays better: For the 5,960 times ‘Tugboat’ was played there, Galaxie 500’s songwriters went collectively into triple digits: $1.05 (35 cents each).
It’s one thing to talk hypothetically. It’s quite another to see nearly 8,000 ‘plays’ of an actual song valued at less than local phone call.
The ‘Tugboat’ 7’ single, Galaxie 500’s very first release, cost us $980.22 for 1,000 copies-- including shipping! (Naomi kept the receipts)-- or 98 cents each. I no longer remember what we sold them for, but obviously it was easy to turn at least a couple bucks’ profit on each. Which means we earned more from every one of those 7’s we sold than from the song’s recent 13,760 plays on Pandora and Spotify. Here’s yet another way to look at it: Pressing 1,000 singles in 1988 gave us the earning potential of more than 13 million streams in 2012. (And people say the internet is a bonanza for young bands...)
It’s easy to look at the figures and cry ‘exploitation’ (and you could be right in doing so), but Krukowski goes on to assess the business models of internet radio itself and finds only more complexity. There is no pot of money being withheld from artists and both Pandora and Spotify are hard at work racking up losses in the tens of millions, while their business capital continues to grow, enriching the business owners to the tune of billions.
Where is all this value coming from and has it really been built on the back of decades of creativity without due acknowledgement?
Clearly, we’re drifting away here from a simple industrial object-oriented market where the creative work is tied to a physical product that can be sold for a greater amount than the cost of its manufacture. But to compare streaming-from-the-cloud—where songs are necessarily tied to a decent internet connection and songs are never entirely ‘owned’—with vinyl LPs is not entirely fair.
A song broadcast on radio has the potential to be heard by millions with a similarly meagre income stream, but to pay an artist royalty per listener in radio would be ridiculous. Where would such money come from? But to compare streaming-from-the-cloud—where listeners have much more control over what they hear and when—with traditional radio is not entirely fair either.
A cloud-based streaming service sits somewhere in between: a vast catalogue of creative content available on demand, but which a consumer never actually owns.
For centuries, when they were beyond the means of individuals to own, books were primarily the property of institutions. As books became cheaper to reproduce and an industry emerged in the manufacture and sale of these objects to individual readers, the retail model of bookselling coexisted more or less peacefully with by now public and freely accessible libraries (peacefully enough to ensure their mutual survival to date in any case). There’s a handy distinction between books borrowed and books owned, mostly around the convenience of reading at one’s own pace and the book’s long third life post reading as a memento, as a trophy, or as bragging rights.
Electronic reading takes the bookshelf—sometimes quite literally—to the screen and most modern devices are linked to a seamless flow between bookshop, personal ‘shelves’ of titles, and the texts themselves, an interface in many ways first exemplified by Apple’s iTunes Music Store from 2004: the catalogue of products exists in the cloud and purchases are downloaded to local storage. Easy. But combine ubiquitous connectivity and the book’s minimal data requirements and, in 2012, who needs local storage? If you read on a Kindle for example, your books are already stored in the cloud, for better and for worse.
Subscription libraries have never had much of the impact of their public siblings, but digital delivery has brought subscription back under serious consideration. Like on demand radio, a subscription library service could provide access to a vast collection of books, available at a reader’s whim. Like radio-on-demand, such a service would significantly overlap the function retailers, making purchases almost unnecessary for some readers. A large subscription database earns its income not from the content but from the customers. How would authors be remunerated for their content when being paid per reader becomes financially impossible? Or is being remunerated for content alone a stupid idea? What are readers paying for?
It takes some effort to maintain perspective when the topic turns to money and it’s all too easy to cast this discussion as just the latest example of a long history of artists getting screwed by the business that surrounds them. Doom and gloom is similarly easy to peddle. But the promise for writers to use digital networks to better connect with an audience and to build a meaningful career from that relationship is real. The desire from readers to discover new work and new authors is not imaginary. And many readers are happy to reward authors for their efforts.
Building an infrastructure that can allow that to happen seamlessly will take all the creativity we can muster.
Simon Groth is a writer, editor, and manager of if:book Australia. He's also quite partial to loud music and statistics.