Artists Will Receive Nothing from the $3 Billion Beats Acquisition, Sources Say…| DMN

The three major labels secured an equity share in Beats Music as part of their licensing agreements with the service. But according to multiple sources close to those negotiations and Beats’ subsequent sale, artists on those labels will receiving nothing at all from the roughly $3 billion acquisition by Apple.

The reason is that acquisition earnings aren’t tied to actual sales or streams, and therefore are not accounted at all to label artists. “They will get nothing,” one industry attorney flatly told Digital Music News, while insisting on anonymity.


Why Streaming Music Isn’t Like Bottled Water… | Digital Music News

Streaming music is just like bottled water, right?  Not all, actually.

1. People happily pay outrageous premiums for bottled water (a glass of tap water costs about $0.001).
Relatively few people actually pay for streaming music.

2.  People are convinced that there’s a difference between bottled water and tap water.
Not enough people feel there’s a difference between ad-based (free) streaming and premium (paid) streaming.

3. Sometimes, tap water tastes funny.
Free streaming always tastes good!  You just have to wait for it a little longer.

4. Bottled water is a proven, $100 billion industry that’s been around for decades.
Streaming music isn’t a profitable industry, hasn’t been around for more than a decade, and remains financially speculative.


The Tyranny of Legality | The Cynical Musician

Music piracy is a subject that has been talked to death over the past decade. So much, in fact, that it seems scarce conceivable that we could say anything more of interest on the subject.

The fundamental point I’d like you to take away from this is: it’s a lot more important to keep a watchful eye on ostensibly legal services – recall that both Pandora and (perhaps to a lesser extent) YouTube are legit – than to agonize over overt piracy.

That pirate services should be hunted to as close to extinction as is feasible goes without saying, but we mustn’t lose sight of the fact that nobody deserves a medal for going legit. It’s what you’re f-ing supposed to do.


Beats Music Hires Artist Bully as Artist Advocate

Billboard Magazine is reporting that Beats Music has hired long time artist bully Dave Allen as their so called Artist Advocate.  This is fantastic news for artists rights bloggers and music journalists as they were close to running out of ways to imply Dave Allen is a shill for streaming services.  By taking this job at Beats Dave Allen has made it easy for all of us.  Now we can just come out and say he’s paid by the streaming services!

If you don’t know, Dave Allen is the former bass player for the Marxist Rock band Gang of Four.  Allen has made a name for himself by rudely lecturing songwriters like David Byrne, Thom Yorke and myself on streaming, globalization and the inner workings of free markets. Rich right?

And it looks like he intends to continue.  Check the featured quote from the Billboard story announcing his hiring:

“It is hard for me to understand why intelligent people like David Byrne and Thom Yorke do not appear to understand that we are in the midst of new markets being formed,” Allen wrote. “I have concluded that we can only look to what internet and mobile users are doing or want to do, and then note how their actions drive technologists to provide platforms for them. Put very simply, that is how markets work.”

(Wow.  This is his first day as Artist Advocate? Off to a bad start-Ed)

No Dave.  It’s the opposite of markets.  By Government mandate our songs have been “collectivized” for use by these streaming and webcasting services.  Further government rate courts set the prices.  There is no “market” for songs.  He’s purposely leaving out the part where the government forces us to license our songs to the technologists at below market rates!

Allen knows this.  Everyone in the business knows this.  I mean that’s why  U.S. Rep Doug Collins of Georgia introduced this week this bill to establish fair market pricing for songs!

While we have some generally positive things to say about the Beats service (the lack of a free tier means their effective per spin rate to songwriters and performers will be higher than many other services) we note that the appointment of Allen does not bode well for Beats Music.

This is a ham-fisted move that won’t solve the fundamental PR problem that all streaming services have with the general public: low payouts to artists and a lack of transparency. No amount of shouting and name calling by Allen will fix that problem.  Quite the opposite.


Music Streaming Math, Can It All Add Up?

Streaming Services Will Never Become Profitable, Study Finds… | Digital Music News

It’s time to end compulsory licensing for digital music | Tech Liberation

Get Ready For The Streaming-Music Die-Off | ReadWrite

We’ve been saying for a while that we’re not opposed to music streaming as concept so much as we are about the revenue models and royalties. We’ve offered our criticisms that the math just never really adds up, even if you scale out Spotify to it’s logical conclusion.

We’ve also offered our suggestions for how these streaming services could offer a more robust and diverse environment to both artists and consumers. Looks like we’re not the only ones seriously questioning the economic validity of these models.

The streaming era is the next music industry ice age.

Beyond their broken business model, these companies share a lot of dubious promises to investors, shareholders and artists. Rdio hopes to get in the black by luring in more ad-supported subscribers. Spotify promises that when it scales up to 40 million paid users—it’s currently at 6 million—that artists will get paid five times what they make from the service today (the math works out, but that 40 million figure is a big “if”). Pandora, unprofitable and crippled by royalty fees as its user base grows, promises that mobile ad revenue can offset the revenue it’s hemorrhaging.