The grand irony here is that the panel which asked the question “”Will Artists Make Money on Big Music Platforms?” not only reported that artists could not, but also suggested that artists needed to focus on selling concert tickets and merchandise. You know, things artists did BEFORE the internet.
We admire the honesty of Hany Nada, Managing Partner GGV Capital who bluntly and glibly admitted during the SXSW Panel “Will Artists Make Money on Big Music Platforms?” that he believed that they would not be able to do so. He also added that he the point of digital streaming platforms such as Pandora, Spotify, and others was promotion to help the artists tour, sell t-shirts and offer other non-digitally distributable “experiences” to fans (why is this sounding more and more like prostitution?).
At least Mr.Nada is honest, which is refreshing given that the man has more integrity than most of the executives at that streaming services who claim the problem of royalties is one of scale and not sustainability. Mr. Nada (ironically named in this context) may be well intentioned and honest but he is also grossly misguided.
Mr. Nada’s statement and philosophy that streaming sites should be viewed by artists as a promotional platform more so than a financial one are an admission of the failure of these unprofitable start ups to serve musicans. As such, let artists decide if there is a value proposition in these companies that benefits the artist and allow them to opt out. Not every album should be on streaming services. Not every artist should be on streaming services. And if streaming is nothing more than promotion with little value proposition, than artists need to rethink their relationships and strategies regarding those businesses.
To be fair, it’s not just Mr.Nada who has promoted this philosophy. It appears that many of the music streaming company executives on panels at SXSW alternate between two talking points. First is that these services will support musicians when they scale (which we can find no evidence of). And second, when pressed on the first point, that streaming platforms offer promotional value for artists to make money in other ways. Oddly, other than “t-shirts and touring” no one seems to have any idea how to translate an artists participation on streaming services into a sustainable revenue stream.
In almost every way streaming companies represent the worst of both the old boss and the new boss.
So here’s the take away, which was put forth by a series of questions from the floor that largely went unanswered.
1) If artists can’t be expected to make a living from streaming music why should streaming executives make a living from streaming businesses at the artists expense? These are essentially, artists subsidized corporations.
2) As artist’s are bringing the audience to the platform, why should the platform profit, but not the artists? Test this theory, No Music = No Business. Done.
3) Artists have been able to sell t-shirts and tour long before the internet and without streaming platforms, but streaming platforms can’t exists without the artists music. Again, No Music = No Business. Done.
4) Given that the streaming music thought leaders believe that the”new revenue model’s” for musicians are “touring and t-shirts” when are the streaming company executives going on tour to sell t-shirts to support their businesses? We find it odd that the executives running companies that are not profitable are giving business advice to musicians.
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