The quirks of the music subscription service model

I read this very noteworthy article recently on the sustainability of the music subscription services and here are my thoughts on it.

I’m sure Spotify can be very successful and profitable in just offering those all-time mega hit songs and the summer hit songs. Those songs tend to engage the audience throughout their lifetime.

But when you look at what kind of service that would make, it seems to me to be the model of the “oldies but goodies” radio stations. A very conservative form of both media “broadcast” (in the wider sense not the technical sense) and listener behavior.

I would like to ask a different question:

Would spotify as a service that focused only on those all-time-great songs and not on a catalogue as big as possible be an attractive place for the curious music lover?

I remember an instance in 2006 or 2007 when I visited my friends in Los Angeles and drove around in my rental car listening to the world famous KROQ. What happened was that I felt like every time I turned on the station and drove for about 45 minutes (the average drive time in LA) I would hear

* City of Angels, Red Hot Chilli Pepper
* Enter Sandman, Metallica
* The Pretender, Foo Fighters

This is all fine and dandy, they can play whatever they want and how often they want, that’s not my point and on top of that, I love those songs.

The curious music lover

But from a curious listener standpoint those forms of media are becoming less and less interesting to me. I would like to explore new songs, find voices I haven’t heard before, dive into the experimental, challenge my taste expand my horizon and so on. Which is where all the indie artists come into play that make up the bulk of Spotfiys catalogue and in my opinion, they make up the real attractiveness of the service.

Unfortunately for those artists, music subscription services will never amount to a reasonable or even noteworthy level of income stream as the calculations in the article reveal. But the calculations in the article make it abundantly clear that the royalty rate that the subscription services pay today are the only ones that are viable with the currently assumed listening behavior. I get that and I respect that. Please read the section on the promotional aspects in the article for consideration of that argument. Basically subscription based music consumption promotion will lead to more subscription based music consumption and as such to the lowest possible roaylty for the artist.

My conclusion:

Subscription services are great discovery tools if they actually work at presenting you things that you don’t know. But if you truly would like to support an artist, there is no other and no better way than to purchase the music from him or her directly. And hopefully the artists retained enough rights to the music to be able to sell on a distribution platform that has a fair revenue sharing model. I don’t want to advertise any, we can discuss them in the comments if you like.

 

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