Wednesday, August 19, 2009

Spot the streaming problem

I have previously noted some of the ongoing difficulties plaguing the music industry with regard to downloads and streaming.

Everyone seems convinced that a subscriber-led streaming service will be the solution to illegal P2P downloading. Others have tried, but Spotify seems to be the industry and consumer favourite at the moment. The Guardian thinks it knows why, repeating a belief that has been circulating for some months - the labels have shares in Spotify

The Guardian seem to be suggesting that the artists will not see this cash, an allegation I'd have to question. If this belief begins to circulate it will lead to an inevitable exodus of artists from Spotify. Bob Dylan has already left the building

If it's all in simple mathematics then the digital problem still exists. I read in this week's edition of Music Week that Spotify in the UK is processing 10 million streams per day, which should result in a sixty thousand pound royalty payment (on standard current terms) to artists/labels every day.

If Spotify is currently getting £82,000 per month in ad revenues and has only 17,000 paying £120 a year for the premium service then there's a significant shortfall. The digital solution is still not an obvious one.

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