Biting The Hand That Streams

BAGeL Radio is all for artists getting paid.  From a totally selfish perspective we want to do what we can to enable the band that made Album 1, which we love, to make Album 2. And 3. And 4...

Using established artists to provide context, at BAGeL Radio we aim to connect the dots between newcomers and the artists upon whose shoulders they stand. We help listeners find and bond with their next new favorite music by filtering through a sea of weekly music submissions and hand-picking the best of the best.

I have personally spent 20-40 mainly unpaid hours each week for over 10 years curating, editing, storing, presenting, promoting, and streaming new music in the hopes of turning music fans on to emerging artists.  

We announce where bands are from and when they are on tour to spur listeners to go out see bands when they tour through their towns.  We also do this to encourage listeners to support local music scenes, which are where much great music starts -- in basements, dive bars, and tiny clubs -- and I can't tell you how many times we've gotten feedback along the lines of, "that band is from here? I had no idea! They are playing down the street tonight, can't wait to see them!"  

We have always encouraged listeners to spend money on the music they like by buying CDs or files, t-shirts, etc.  More recently, subscribing to large-catalog subscription streaming services has been added to that list of ways listeners can support music creators.

David Byrne recently published an opinion piece lamenting the small amounts these streaming services are currently paying out to musicians for the use of their music.  The headline reads: "The internet will suck all the creative content out of the world."

To Mr. Byrne I would suggest that small payouts which have a chance to grow into larger payouts as more fans opt-in to this style of music consumption are preferable to the (new) old way of doing business -- overcharging fans for shiny plastic discs they don't need and pushing many to find unauthorized copies of the same music at no cost.  

Streaming is a potential way forward. Selling physical product and even digital files is seeming less and less viable.

If per-stream per-listener payments are to be compared with the income an artist might have earned through a "sale," (which some music fans have learned the hard way isn't necessarily a "sale" but a revokable lease) keep in mind that the latter is a one-time windfall, the former is an accumulation of income over time.  In other words an artist may collect $10 (or whatever their record deal stipulates) for the sale of a CD,  but those same 10 songs may earn an artist much more than that on a streaming service as they are played over time.

Byrne's piece rehashes complaints made my several other musicians about the lack of money flowing to music creators. While the aim of getting musicians paid is most certainly worthy and admirable and we are all for it, doing so by restating tired, refuted, illogical, and/or simply out-of-touch-with-current-realities arguments over and over again without presenting even a hint of a way forward is not helpful.

Misinformation, be it intentional or unintentional, will not move this issue to a better place.  If anything, smearing subscription streaming services (a promising route to getting more fans to once again pay for music), will deter fans from subscribing which will slow progress towards the critical mass needed to increase artist payouts.

In summary, Byrne complains that: 

"[T]he CEOs of the web services are happy."

Translation: Streaming companies are making money.

Reality: Rdio, Spotify, etc. are not making money yet and likely won't for some time due in large part to the significant up front costs of developing and marketing these new services.  Building the infrastructure for delivering all these streams of music requires a great outlay of money.

Lest anyone think that streaming services are pocketing tons of money while stiffing artists, keep in mind that Spotify, the largest of these services, is paying out 70% of its revenue in royalties.

Byrne: "The major record labels usually siphon off most of this income, and then they dribble about 15-20% of what's left down to their artists. Indie labels are often a lot fairer – sometimes sharing the income 50/50."

Translation: Record labels are making money and unfairly taking it from music creators.

Reality: True. This is due to contracts signed between artists and labels.  Streaming services have nothing to do with the deals artists signed with their labels.  In fact, streaming services themselves have been forced to sign bad deals with record labels forcing them to pay huge upfront sums to stream their catalogs.

Byrne: "The amounts these services pay per stream is minuscule – 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. We should readjust our values because in the web-based world we are told that monopoly is good for us."

Translation: Artists' cut of the money being made is not big enough.

Reality: Agreed, and we, too, wish that music creators were making more money.  The inference that the reason artists are getting less than they should is because the streaming companies are not sharing enough of their revenue is, however, untrue and counter productive.

Byrne: "Damon Krukowski (Galaxie 500, Damon & Naomi) has published abysmal data on payouts from Pandora and Spotify for his song "Tugboat.""

Translation: I'm trying to prove the point about low payouts (which no one is arguing are sufficiently high at this point) by referencing what Damon Krukowski said.

Reality: Krukowski's numbers and logic were flawed and misleading.

Byrne: "[David] Lowery even wrote a piece entitled "My Song Got Played on Pandora 1 Million Times and All I Got Was $16.89, Less Than What I Make from a Single T-shirt Sale!""

Translation: I'm trying to prove my point about low payouts  (which no one is arguing are sufficiently high at this point) by repeating what David Lowery wrote.

Reality: Lowery's numbers and logic were flawed and misleading.

Byrne: "The major record labels usually siphon off most of this income, and then they dribble about 15-20% of what's left down to their artists." 

Translation: I signed a bad deal with a record label which is once again screwing me out of money.

Reality: Byrne and other musicians are implying that streaming services are either to blame for this, or should whip out their magic wand and fix it for me even though they had nothing to do with said deal.

Byrne: "In future, if artists have to rely almost exclusively on the income from these services, they'll be out of work within a year."

Translation: Artists will stop making art if they are not well-compensated.

Reality: Throughout history humans have made music. Some found ways to monetize the music they made. Some even found ways to get rich making music.  Others created for fun. Others worked day jobs while creating music.  All of this is still happening today and will continue.  History shows that even if most artists cannot forge a livable income from their art, humans will continue to create art.

Byrne: "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 favourite albums and artists either for free, or for a nominal monthly charge?"

Translation: Even though I'm a really intelligent guy who knows that it's actually easier for the masses copy music today than it was to make a photocopy when I was a starving artist, I still hold out hope that the days of selling music are coming back.

Reality: New revenue streams are needed, because technology and bad business practices (for example intentional crippling of music files) have made it easy, convenient, and in some ways preferable, to copy music instead of "buy" it.  It is unrealistic to expect the masses to jump through hoops to "buy" what they want, particularly when they have learned that they can jump through fewer hoops to get it for free.

Byrne: "As Lowery has pointed out, there's no reason artists should simply accept the terms and join up with whatever new technology comes along. Now I'm starting to sound like a real Luddite, but taking a minute to think about the consequences before diving in seems like a pretty good idea in general. You shouldn't have to give up your privacy, or allow all sorts of information about yourself to be used, whenever you go online, for example.

I don't have an answer. I wish I could propose something besides what we've heard before: "Make money on live shows." Or, "Get corporate support and sell your music to advertisers."

Translation: I have no helpful ideas to add to the discussion about improving the lot of artists, so I have decided to introduce an unrelated element (privacy) to the conversation, further confusing matters.

Reality: There is a reason that most artists should accept the terms -- we have in place a vehicle for getting artists paid for the use of their music called collective licensing.  If an artist wants to opt out of this system and has not already signed away the rights to their music to a 3rd party, said artist is certainly able to do so.  It might not be advisable, though, because as we've seen from Napster to LimeWire to The Pirate Bay to MegaUpload, the lure, ease, and ubiquity of file sharing makes erecting barriers to music access counterproductive. 

Even if streaming never becomes a main source of income for artists, it remains an excellent place for music discovery, so as more fans move to this model of consumption opting out effectively blocks current and prospective new fans from hearing one's music via the means fans have chosen to access music.  

Byrne:  "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."

Translation: I don't understand how this works.

Reality: "The actual moment of discovery" that you like something is not when someone tells you about said thing, but when you sample it for yourself and decide that you like it.  This sampling of things you heard about can take place in a number of places, including subscription services like Spotify.

I don't know if David Byrne has ever used a music subscription service, but he obviously doesn't see subscription music as a music discovery platform.  Perhaps if he "followed" a few friends on a streaming service who have tastes similar to his, he would see this differently.

Byrne: "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."

Translation: Artists who are not yet established will not survive.

Reality: Byrne is either unaware of or chooses to ignore the fact that today more music is being produced, released, and distributed every month than was in an entire year in the good old days when he was a starving artist.

I don't have a magic bullet solution to the getting artists paid conundrum, either, but muddying the waters about streaming services by repeating misleading numbers, ignoring market and technological realities, and introducing into the conversation unrelated hot topics is not helping.

If this is the best that David Byrne -- an intelligent, clever, creative, and deservedly well-respected veteran of the music industry -- can do, it is now past time for artists to stop blaming any and everyone else for the state of the recorded music industry today and start taking some responsibility for improving things.

PS-and if you don't believe me, read this excellent Byrne rebuttal by Dave Allen of Gang of Four.

PPS- another excellent rebuttal of David Byrne's muddle by a fellow I know and respect who has worked in streaming music almost since it began.