Thanks For F****** Us (Pt 2)
Here’s a few things that the music industry’s current model make nearly impossible
In part 1, I detailed the history of the music industry that led us the to four companies owning an entire industry. In this part, I’m going to look into why the music industry in its current form stifles innovation and leaves most artists and listeners out to dry.
Mixtapes and Albums can’t hang
The fact that DatPiff continues to exist seems absurd until you realize that Spotify and other label-approved streaming services would quickly lose that approval if they offered artists the ability to upload free music in a soundcloud-like format. This makes it even more obvious why Soundcloud has struggled to get label support for so long. If Spotify introduced a feature that allowed artists to upload content that doesn’t get paid for by subscriptions, web services like DatPiff would quickly vanish and non-label music would explode further.
Artists Making Money on Records
Surprisingly most people don’t know this but artists don’t make money on record sales. No, like nada, none, zilch. Unless you’re a top 1% artist, your record deal is essentially just a loan from a label to pay for the production, marketing, distribution and protection of your music. After this advance, the label will often take as much as 90% of the revenue off of album sales. Artists make the lions share of their money off of touring and merchandise and sometimes the labels even manage to take a piece of those as well. This model is certainly becoming less sustainable for labels as production has turned into one person on a laptop and distribution can be as simple as clicking upload. The problem lies in the fact that most people just don’t want to search for music. They want to click a button or turn a dial and have it found for them. For independent artists, getting that click or turn is much too expensive without help.
Radio won’t go away (yet)
Now that artists can technically distribute music globally on their own, the labels most valuable proposition is their ability to get people to actually listen to the music. Radio still accounts for 52% of music listening in the U.S and while Payola may be illegal, the labels have found quite a few loopholes to convince radio stations (of which Clear Channel controls over 31% of stations) to play their music. The content business was built on monopolies and there’s no indication that that will change any time soon. And, while monopolies are certainly ideal in the ideas of any large company but when it comes to innovation they rarely welcome it.
That being said, history has always seemed to favor innovation over control, it just takes a while.
True innovation in streaming
Yes, Spotify and the like are changing how we listen, discover and pay for music. But the only “new” piece of that puzzle is the pay part. Napster had a nearly identical format for discovery and listening. Curated discovery through machine learning is being introduced with features like Spotify’s Discover Weekly, Apple Music’s “For You” and Pandora Radio but these still ignore a crucial market. 75% of my music library from the past 5 years has come from soundcloud and blogs yet this amazing content simply can’t be included in curation services. Additionally, as the subscription services fight for the small market share that is paying streamers, artists will continue to take large checks in return for making their music exclusive to one platform. This not only kills innovation but also distribution. It’s likely the reason why Drake didn’t top the charts with Hotline Bling despite it playing by everyone and their grandma.
*How We Hope To Help
When Laylo launches in February, our goal is to knock down the barriers these limitations impose by combining streaming services into a collective curation service. By focusing on the discovery and content rather than fighting for label rights, we hope to provide a platform that benefits artists and listeners rather than giving the old industry model another electric shock.
If you dig my writing or hate it and want a place to listen find great music to get my voice out of your head, join us at Laylo.