Streaming Services Impact on the Music Industry

Streaming services provide access to vast music libraries for a low monthly fee, allowing users to listen to whatever they want without making large purchases. The result has given the industry more control over the distribution of its music, and more people have signed up for these services. Therefore, this has helped to boost the music industry's revenue and revive it. The music industry saw hope in streaming services, but reports suggest that streaming services such as Spotify are reducing royalties while competitors like XBox Music pay musicians more per stream. (Wagner, 2018). As illustrated below by Statista, Xbox Music pays the most by far at 2.73 cents per stream, while Youtube pays the lowest at 0.07 cents per stream. Other streaming platforms pay the following: Rhapsody at 1.68 cents per stream; Tidal at 1.28 cents per stream; Apple Music at 0.78 cents per stream; Amazon at 0.74 cents per stream; Deezer at 0.62 cents per stream; Google at 0.61 cents per stream; Spotify at 0.39 cents per stream; Pandora at 0.13 cents per stream.  

Each streaming service has its factors that determine the royalty, and even these vary depending on whether it is interactive like Spotify, or non-interactive like Pandora. The interactive platforms are paying a lot more. For instance, paid subscription tiers pay a lot more than advertiser-driven tiers. There are different rates of advertising and subscription in many countries. These rates increase during the holidays and in the summer when advertising is involved (Owsinki, 2018). 


Furthermore, the allocation of artist royalties is agreed upon under the record contract. Performance royalties are produced when copyrighted compositions are performed, recorded, played, or publicly streamed. This covers public venues where music is played in public, such as pubs, restaurants, clubs, live concerts, streaming music services, and radio and television stations. Songwriter royalties and publishing royalties are the two types of performance royalties. The Performing Rights Organization (PRO) collects Performance Royalties for artists who are affiliated with their organization and is responsible for managing and disbursing both (Music Royalties Explained, 2023).


Traditional jobs have been eliminated in the music industry due to technological changes, but new jobs have also been created. At the same time, paid subscriptions play an essential role in this digital transformation of how people consume music (How The Internet Has Changed Movies and The Movie Business, 2023).

References

How The Internet Has Changed Movies and The Movie Business. (2023, February 27). Film          Connection. [Retrieved on 2023, August 15]. https://www.filmconnection.com/reference-         library/how-the-internet-has-changed-movies-and-the-movie-business/

Music Royalties Explained. (2023) Indie Music Academy. [Retrieved on 2023, August 19].             https://www.indiemusicacademy.com/blog/music-royalties-explained

Owsinski, B. (2018, April 5). Which Streaming Service Pays The Most? Music 3.0 Blog. [Retrieved on 2023, August 19]. https://music3point0.com/2018/04/05/streaming-service-           payouts/#:~:text=A%20big%20surprise%20is%20that,134%20cents%20per%20stream.

Wagner, P. (2018, April 3). Music-Streaming: Who Pays Best? Statista. [Retrieved on 2023,          August 19]. https://www.statista.com/chart/13407/music-streaming_-who-pays-best/

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