Musicians are literally starving with live show cancellations due to the COVID pandemic
We’ve all heard the trope “starving musician” before since musicians are typically living hand-to-mouth, hardly scraping out a living going from bar to bar to play live shows and sell merchandise. Now with COVID19 closing down all bars and live music venues, independent musicians’ primary revenue source was abruptly cut off, leaving them with no way to sell tickets or merchandise. Some musicians have part time jobs due to their unpredictable schedules, which they have in most cases also lost. Many do not have the ability to apply for unemployment and many have not filed tax returns to receive their stimulus checks. Most do not work for companies that can apply for payroll protection. There’s no salaried payroll tax to have cut, and what has generally been a cash business is completely shut off for millions of musicians around the world. There is a serious humanitarian crisis at hand, and musicians around the world are literally starving and struggling to find the little money they need for food and shelter.
How did we get in this mess to begin with? Artists and musicians used to have a more diversified set of revenue streams with the sales of albums and tracks in addition to live show tickets and merchandise. With the rise of free downloads on Napster and then digital downloads on iTunes and now streaming services like Spotify, artists’ revenue from their music itself has been going down for 2 decades to anemic levels which are hardly enough to earn a living. Thus artists have turned to live shows and touring as a way to generate enough cash to survive. Live shows and merchandise sales, which used to be the minority revenue stream, has now become the majority revenue stream for musicians. Even though the last 2–3 years have seen a massive resurgence in streaming service revenue, less than 12% of that revenue makes it to the artists and in most cases it can take months or even years for artists to receive their royalty payments. Even millions of streams on Spotify or Youtube can hardly break minimum wage for an artist. Live shows have always served as the bulwark against unpredictable digital music revenue streams, and now that mainstay has been lost.
While it might take weeks or months for bars and venues to start opening up (the ones that survived), it could take even longer for people to feel comfortable going to live shows while social distancing will probably last longer than the stay-at-home orders. It could take a few years before live show revenue returns to where it was before the crisis. A crisis like this accelerates trends that were already forming beforehand, and some of the silver lining is that many musicians are doing live streams of them playing in their living room with their family and/or pets to hundreds of their fans on Instagram. There have even been more mainstream virtual productions like the “Living Room Concert for America” hosted by Elton John featuring many artists like the Backstreet Boys, Alicia Keys, Billie Eilish, and many others. While this shift to live-streaming for musicians has been great to watch, one should worry, how are these musicians getting paid? The problem is, they are not.
How can we change this? In order for live streaming shows and music streaming to become a reliable revenue source for musicians, fundamental changes in the business model for digital music must be made. No longer should publishers and rights-holders take 90% of the digital revenue from artists and takes months to pay them pennies. The middlemen must be removed and the music industry must be dis-intermediated. Artists should be able to go direct-to-fan and get paid for every second of streaming and allow their fans to tip them for their creative work. Livestreams should allow virtual ticketing and virtual tips to be given by the audience in addition to just heart emojis. Musicians and artists need to be able to get paid through these digital platforms in a sustainable way so they do not starve alone with nowhere else to turn.
In order to make payments go directly artists in this brave new world, we must embrace micropayments technology that allows artists and musicians to be paid in very small amounts under $10. No longer are albums being sold for for $9.99 and live shows for $29.99. We need micropayments technology that does not involve exorbitant credit card fees (another middleman) that makes it economically feasible for individual fans to pay for music as they stream it and pay for live stream tickets and tips at a few dollars at a time. One promising technology that can underscore this move to global micropayments is cryptocurrency. The only service currently doing pay-per-second streaming with cryptocurrency is a small startup called tune.fm. Their JAM cryptocurrency allows artists to get paid directly from their fans for every second of streaming. The team is also currently working on live-streaming capabilities with virtual tickets and tips. The project is still in the early stages, but like all the starving musicians, this innovative startup team needs all the help they can get. At the end of the day, it is efforts like these that push the boundaries of what is possible and pave the way for a future where artists are paid a living wage and musicians are no longer starving on the streets.
