Issues in the music industry

As the music industry splinters into new niche markets almost daily, there is one thing everyone can agree upon whether your a musician, major label executive, or savvy indie label president- the music world is in a BIG mess. Don’t get me wrong, the industry is booming with new possibilities if you know how to work it properly, but everyone experiences growth and pain in different ways. Majors are still gasping for air since the piracy punch to the gut, indies battle for their share of the marketplace, and musicians fight the daily grind to be heard; but regardless of your individual problem the industry as a whole has two massive pills of mess on their plate: streaming & globalization.

Let’s go ahead and acknowledge that downloading has had both a negative and positive effect on the industry; but with the birth of downloading comes the explosion of new technology and emerging grey markets. Even though downloading and piracy continue to be the largest obstacle blocking industry professionals from making a dime, when these issues are solved, streaming and globalization troubles will inevitably move to the forefront. As the current downloading/piracy problem will eventually be resolved, it is important to look to where the industry is going, where it will end up, and how to be proactive and plan for the future. 

MUSIC PIRACY!

The practice of labelling the infringement of exclusive rights in creative works as "piracy" predates statutory copyright law. Prior to the Statute of Anne 1709, the Stationers' Company of London in 1557 received a Royal Charter giving the company a monopoly on publication and tasking it with enforcing the charter. Those who violated the charter were labelled pirates as early as 1603.After the establishment of copyright law with the 1709 Statute of Anne in Britain, the term "piracy" has been used to refer to the unauthorized manufacturing and selling of works in copyright. Article 12 of the 1886 Berne Convention for the Protection of Literary and Artistic Works uses the term "piracy" in relation to copyright infringement, stating "Pirated works may be seized on importation into those countries of the Union where the original work enjoys legal protection."Article 61 of the 1994 Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs) requires criminal procedures and penalties in cases of "wilful trademark counterfeiting or copyright piracy on a commercial scale". Piracy traditionally refers to acts intentionally committed for financial gain, though more recently, copyright holders have described online copyright infringement, particularly in relation to peer-to-peer file sharing networks, as "piracy."

How is this damaging the music industry?

basically, if people keep stealing music and sharing it freely, then companies aren't making the money intended to cover up their costs, or to make more on top for further development of the artist as a brand!

Streaming, and how is it an issue?

Despite being vastly different, people still confuse “streaming” and “downloading”. To quickly address, downloading is when you purchase an individual song or album in a digital format. You own the song, you purchased it, and you can play it however you see fit. Streaming is listening to the song/album where you can stream music, but more importantly you can do it for free (or little cost in some cases), as long as you have a device for streaming. Use Spotify as an example. 

People in selective countries can use Spotify on their computer and listen to songs all day. You don’t have to purchase a song, rather you stream it. Problem with this formula, if you want to be mobile and ride around in your car, or go jogging and listen on your iPod, you clearly can’t take your computer and access Spotify. Accessibility is the primary problem. Well the means to stream are becoming very much accessible now (ie: phones, cars, etc…) which could eliminate the need to download (ie: pay for the music). As a user I wouldn’t disagree with this model one bit. Why in the world would I download a song at $1.29, when I can stream the entire album for free anywhere I want?


Streaming isn’t necessarily illegal rather it is a bit of a grey market. Because it isn’t illegal, consumers argue streaming services are functioning as an essential means of marketing/promotion for musicians. Bullshit. Marketing and promotions is essentially an investment a musician makes in order to control the markets in which they are exposed. When marketing and promotion works properly, the musician will see a return on his investment. Streaming does NOT provide a return on the investment. Billboard recently ran an article by Robb McDaniels on this very topic. 

Tell me if this songs sounds like a good return on investment: “It takes 150 to 200 plays of a song before the content owner earns royalties on par with a single download.” That is 200 plays = 1 download people! “Content owners typically get paid 70 cents per download and half a penny per stream.” It doesn’t take a financial advisor to figure out this will presents some cash flow problems. Further, I seriously doubt someone is going to listen to the same track 200 times; but if they do it may take a 6 months. Wow, 6 months and 200 streams to earn 70 cents. Yeah real savvy marketing/promotions Mr. Consumer. Thanks for the tip.