Sun, 6 Apr 2014

Is Music Streaming a Threat to the Music Industry?

People who consider themselves music fanatics are probably familiar with music streaming sites such as Spotify, Deezer, and Pandora. However, most people may not even hear of how these sites affect the digital music industry.

People Prefer To Stream Their Music

Since the birth of music streaming, perhaps mostly attributed to Sweden, the country where Spotify was conceptualized, the sales for digital music rapidly declined, with sales depreciating from 13.8% in 2012 to less than 12% in 2013.

Since the total revenues for records consists of 70.5% from streaming of tunes, producers and artists are alarmed with the implication these sites may influence in the music industry, since a lot of people prefer to stream their music than download them.

Streaming Affects The Health Of The Music Industry

According to the statistics provided by Nielsen, the rapid deterioration is closely attributed to the breakthrough in the ability of people to stream tunes from various websites.

People would have to consider that when they stream tunes, a transition in record sales happens. From the usual physical album sales to the digital music through download, tunes are now made available to be streamed from online venues. Despite the contentious streaming royalty payments given to musical artists, wherein they are paid per streaming, this new method of availing of songs of various genres undoubtedly affects the health of the music industry, in general.

Royalty Payments

It was noted that recently, many Swedish artists planned to file a lawsuit to the Universal and Warner Music, demanding an increase in royalty payments from services like Spotify. This presents the idea that these artists may eventually pull out their tunes from these streaming services. Swedish Musicians' Union lawyer Per Herrey also suggests that there is not legal platform as to the validity of Spotify in distributing their songs.

However, this complaint was debunked by a justification that costs in producing records in physical form may be relatively higher than that of digital distribution; much so for streaming of songs. Thus, people in the streaming industry opt to offer their services at a lower price.

In addition, sites that specialize in streaming multimedia content also impose an impact on music spending of the people, since they present a lower cost substitute for listening to music as compared to digital downloads such as iTunes. This way, it also creates a sense of competition among the providers of records, which, apparently. In this competition, streaming sites are apparently winning since people prefer low cost to free streaming of music than downloading them for $0.99.

Streaming Sites Has Affected Today's Culture

Despite the huge decline on sales that these sites have caused, it also addressed one of the most important issues faced by modern music industry - piracy. Since Spotify only provides tunes to people through streaming, there is also a decline in possibilities that people would be able to pirate these records and sell them for their own interest. Thus, as Spotify claims, artists would be able to receive all the fruits of their labor, without giving a portion to freeloaders such as those pirating digital tunes.

Fewer High Quality Produced Songs

Whether or not streaming sites improve or destroy the music industry, it has undoubtedly affected today's culture particularly in the way people listen to their tunes in the modern age. One sad thing though is that the high quality produced songs are fewer today. For many artists and record companies it cost to much to hire arrangers for strings, horns, studio musicians and so fort and that affects the quality.

More to read:
Spotify or iTunes? The Battle for Music Supremacy.
Spotify Is Making Tons Of Money On Other People's Work.
How Streaming Can Sweep Famous Musicians Into Poverty.