Photo by: Vassillis Kokkinidis
Music streaming has become the new norm over the past few years. Gone are the days where you would have to choose what album or song to buy based on your budget, with streaming services such as Spotify and Apple Music offering cheap subscription fees to open up a whole world of unlimited listening.
Sounds like a dream, but what are the realities of streaming music?
Despite the fact it has recently been announced that record labels have seen the biggest revenue rise in more than a decade due to streaming services, with Warner Music announcing revenue of £2.66bn last year, many worry about how much these streaming services actually pay to artists and the impact on the music industry in general.
Celebrities like Taylor Swift and Radiohead’s Thom Yorke have publicly spoke out about their dislike for companies like Spotify, but it’s important to remember the days before music streaming was so popular.
Illegal music downloading is now less tempting, new music can be found in a few clicks, playlists of your choice can be created and you can listen to any music on the go.
Paul Smernicki, who was head of digital at Universal Records for 17 years, told The Guardian: “I thought the days of the music industry talking about anything in terms of millions were gone, but now we are looking at billions of streams on an almost daily basis”.
Interestingly, Luis Aguiar and Joel Waldfogel wrote a paper on the matter, focusing on Spotify in particular.
They found that despite a stream landing the artist less money than a sale on average, the gains in streaming revenue mean that the loss of the sale is cancelled out, meaning streaming is actually revenue neutral for the music industry.
So at the moment, despite the dark cloud which seems to hang over it, streaming does not seem to be an issue threatening the music industry, and surprisingly has its benefits for both us listeners and the artists alike.