EdWard | Tuesday October 23rd, 2012
In which we post a completely fraudulent headline to get you to read the blog post! Unfair? Compared to some of the stuff that’s happening out there? No way, José!
Consider: once upon a time, musicians got deals from record companies, which were their only way to make themselves heard. These deals were, of course, completely unfair. They ranged from the good old swindle — in which a blues musician cuts a bunch of tracks for $50 and a bottle of good whiskey while the record company guy keeps the proceeds from the hit record that ensues, as well as 100% of the music publishing proceeds — down to the more sophisticated latter-day one, in which an army of accountants “proves” that despite the couple of million records sold, the artist is still in debt to the label, while the publisher, a separate entity, can’t quite seem to pry the money for those sales from its own pockets. No, this doesn’t always happen, of course. Some rock musicians, like Mick Jagger, have studied at the London School of Economics. There may be a couple of others with similar training, but no names are springing to mind at the moment.
On the other hand, we now have a cadre of popular musicians who are better-trained and better-educated about this stuff than ever before. The coming of the digital era has seen them in more control of not only the art they produce, but the business behind it. More of the means of production is in the hands of the workers than ever before, and yet, as evidenced by that story about indie-rock phenoms Grizzly Bear a couple of weeks ago, they’re still not making any money.
So let’s ignore the indie-rockers for a minute here and go with the crass, big-name pop stars. If anyone should be making money, they should be, right? And, indeed, they are — in some areas. Touring, for instance. This is down to a science, so a good bookkeeper and good production people will see to it that you get a fat slice of this particular pie. Record sales per se are down, but to the extent that they exist, enough horror stories about mismanagement of earned funds are out there by now that again, if you have good money people working for you, you’re going to be able to max out your earnings.
But here’s a little problem: the kids are already ahead of you there. Right now, for the consumers who are casually, as opposed to professionally, involved in pop music — which is to say the very teenagers who are consuming this mass-market, mainstream stuff — the main way they get it is via streaming services: Pandora, Spotify, YouTube. These are, for the most part, brand-new media, pretty unthinkable just a few years ago but which have become viable with faster computers and faster connections. No precedent exists for paying people in these media so, um, well, they don’t.
Or not very well. And the reasons are complicated. I remember reading some months back that Lady Gaga had made something like $176 for several million streams of her latest hit single at the time from Spotify. A recent Guardian article provides further examples: Ellen Shipley, who’s gone from new wave also-ran to being a very successful commercial songwriter, says she got $38.49 for 2,188,200 streams of a Belinda Carlisle song, and $4.31 for 330,000 hits on another of her compositions. These numbers are from YouTube, which, the article says, is where 64% of American teenagers now get their music. Unlike back when they were getting it by stealing it (one way of looking at it, of course), we can’t even blame Da Kidz for this one. They’re not writing the deals. Who is? Why, the folks who own the streaming services, that’s who.
And they must be some kind of deals, is all I can say. Shipley can (and should!) complain all she wants about her deal with YouTube, but what she can’t do is tell us what it is: when you sign with YouTube (a part of Google, let us not forget), you sign a nondisclosure agreement. And if there’s money being made by these kids clicking on these links, I wonder how much more Google’s getting out of it than Shipley is. Last I heard, nobody’d figured out a real strong way to monetize YouTube, although I have to admit, I don’t hang out there much, so maybe the ads have gotten more irresistable. I do hear that certain channels are thinking of charging, which doesn’t sound like a bad idea.
As for the other two, I have yet to try Pandora, which I don’t think is available where I live, and I tried playing with Spotify, for which I was given a free membership way back when it started, but I disliked the “music genome” algorithm they used to make further choices and finally just threw it away. But then, I’m not a casual consumer whose consumption of music is a lifestyle enhancement choice. I’m so old-fashioned that I demand a physical product with as much information as possible — not their target at all. No, these early-entry consumers may become someone like that, but right now they’re in it for the beats and the social appurtenances, as we all were when we became music fans.
But there’s no doubt that for most of us, voting with our allowances trickled down: eventually, Bobby Sherman or the Monkees or whoever, and their producers and their songwriters and their labels saw a few of our pennies. Nowadays, there are no pennies involved, so it’s no wonder nobody — not Ellen Shipley, not Grizzly Bear — is seeing much from this particular medium. And once again, with the inevitable human need to find Bad Guys operating here, the fingers seem to be pointing not to the evil record companies for a change, but to the supposedly miraculous friendly digital companies that have opened up this whole new world of possibility. You know, like Google, whose motto is “Don’t Be Evil.” These companies are apt to remind us that they’re startups, so it’s not like they’re rolling in cash themselves. But although they haven’t been around as long as, say, Columbia Records (now a division of Sony), at this point they don’t really qualify any more.
So am I right here in perceiving a bubble? Because I don’t see any other way this makes sense. A hit of your song on YouTube is free for me, but generates an infintesimal amount of cash which Google will then pay you quarterly. There is advertising on the site, and Spotify offers to sell you the song you’re hearing through iTunes, I believe, so they’ll take a bit of that (and so will the people behind the song), but the Spotify spin is free or comes out of your paid membership, depending on what plan you have. The only people who are providing anything besides a service are the Ellen Shipleys and the Lady Gagas who are creating actual cultural product with proven value. Once upon a time, there were a bunch of people like this who were getting burned in a similar way: songwriters who were working in popular music, and most particularly in things like jazz and rhythm and blues and country music, so they got together and formed Broadcast Music, Inc. so that they could join together and get paid. Today, BMI is a giant, and very much a part of the establishment. Maybe a new rights organization, Digital Music, Inc., is called for here. DMI could standardize the deals the streamers make and see to it that the creative people get a fair shake from them.
Of course, by the time they work the kinks out of it, The Kids will be somewhere else, getting their music or maybe abandoning it altogether. There’s no instruction booklet for being a teenager, but if there were, I bet there wouldn’t be anything in there mandating that teenage culture had to revolve around music. But that’s another topic for another day.
PS: Just as this was going to print, the ever-vigilant David Lowery chimed in with a post on his blog about this very subject, revolving around Pandora, the service I know least about. It’s worth taking a minute of your time to read.