From an article in Rolling Stone Magazine:
October 11, 2013 2:45 PM ET
After David Byrne declared Monday that the richest one percent are draining New York's cultural resources, the former Talking Heads frontman is leveling similar criticism at the Internet and streaming music services in a new essay for The Guardian, writing that the new landscape will leech away creative content from the world.
Byrne says he understands why people stream music. "For many music
listeners, the choice is obvious – why would you ever buy a CD or pay
for a download when you can stream your favorite albums and artists
either for free, or for a nominal monthly charge?" he writes, noting
that Spotify is the second largest source of digital music revenue for
labels in Europe. But streaming services like Spotify, Byrne says,
result in padded pockets for labels, not artists.
"The amounts these services pay per stream is minescule – their idea
being that if enough people use the service those tiny grains of sand
will pile up. Domination and ubiquity are therefore to be encouraged,"
Byrne writes. "The major record labels usually siphon off most of this
income, and then they dribble about 15-20 percent of what's left down to
their artists." Byrne points out that a band of four people receiving a
15 percent royalty from Spotify streams would need 236,549,020 streams
to secure an annual minimum wage of $15,080.
Even Daft Punk,
who racked up 104,760,000 Spotify streams for "Get Lucky" by the end of
August, won't rake it in: they'll make only around $13,000 each for
those streams. "This is just one song from a lengthy recording that took
a lot of time and money to develop," Byrne writes. "That won't pay
their bills if it's their principal source of income. What happens to
the bands who don't have massive international summer hits?"
Artists will be out of work in a year if they rely almost solely on
streaming revenue in the future, Byrne says, and not everyone can
support themselves with big tours, die-hard fans and label support.
"Up-and-coming artists don't have that advantage," Byrne writes. "Some
haven't got to the point where they can make a living on live
performances and licensing, so what do they think of these services?"
Though some artists see view Spotify as a positive and accessible way
to spread their music and give listeners a risk-free way to listen,
Byrne disagrees with their assessment, saying there are other paths of
discovery like the artist's website, sites like Bandcamp and even
previews on Amazon. "I like what I hear, there is often the option to
buy," he says.
He continues, "I also don't understand the claim of discovery that
Spotify makes; the actual moment of discovery in most cases happens at
the moment when someone else tells you about an artist or you read about
them – not when you're on the streaming service listening to what you
have read about (though Spotify does indeed have a 'discovery' page
that, like Pandora's algorithm, suggests artists you might like)."
Because labels have a controlling interest in Spotify, artists don't
necessarily stand to benefit from the growth of the service, Byrne
writes. Spotify dished out more than $500 million to U.S. major labels
for the rights to license their catalogues, with another payment to
follow; the labels also received equity, becoming partners and
shareholders in Spotify, which is estimated at $3 billion in value.
"That income from equity, when and if the service goes public, does not
have to be shared with the artists," Bryne writes. "It seems obvious
that some people are making a lot of money on this deal, while the
artists have been left with meagre scraps."
Byrne ultimately doesn't have a solution, though he does have a big
concern regarding streaming as a main method of consuming creative
content in general. "Perhaps we might stop for a moment and consider the
effect these services and this technology will have, before 'selling
off' all our cultural assets the way the big record companies did," he
writes. "Musicians might, for now, challenge the major labels and get a
fairer deal than 15 percent of a pittance, but it seems to me that the
whole model is unsustainable as a means of supporting creative work of
any kind. Not just music."
He finishes with a bleak warning. "What's at stake is not so much the
survival of artists like me, but that of emerging artists and those who
have only a few records under their belts," Byrne writes. "Without new
artists coming up, our future as a musical culture looks grim."
He's complaining that it's the labels that make all the money from
streaming music not the artists. This is another example why it's the
LABELS that are obsolete, not the artists. If the artists upload their
music themselves to Spotify they would make the money. There has always
been a major disconnect between musicians and the business of music with
both sides wanting to keep them separate but there is no longer enough
of a pie to cut up.
Musicians don't seem to have a problem with
considering management part of their act. They split their "artist
royalties" with their manager, sometimes equally as with Van Halen where
there was a five way split. In the future the manager will be the
band's record company president as well and the band members may have to
assume the roles of various record company personnel. Sure, it will
cut into their drinking, snorting and womanizing time but if they want
to keep continuing to pay someone else for all the work that's essential
to their career then they have to shut up about only getting 15%. Once
the musicians start seeing how much work is involved beyond the writing
and performing of three minute pop tunes they'll start to understand why
they're being "ripped off".
