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The power of streaming in music industry

The music industry has been evolving more in the past few decades than it did in the past century. back then, people used to be on radios to listen a dong or they had to go buy the physical cd or go to store but now that has shifted to streaming platforms . streaming platforms like Apple Music and Spotify are now making music available to millions of listeners to listen to any song they want by paying a monthly subscription rather than owning each song.

These platforms made music very accessible to everyone but that has also affected the artist where they are making a dime compared to how much the record label makes from their song Even though streaming bright access for the songs to get global exposure, it also brought a question about ownership, fairness and the artist’s future.

There are my top 3 songs from my play list :

  1. “Too Comfortable” by the Future
    • record label : Epic records
    • Owned by : Sony Entertainment
    • Epic records is owned by Sony Entertainment which is one of the biggest music industry companies
  2. “Bruce Wayne” by NBA Youngboy
    • Record Label: Atlantic Records
    • Owned by: Warner music Group
    • Atlantic records is owned by Warner Music group which is also one of the major company
  3. “Grace” by Lil baby
    • Record label: Quality control Music
    • Owned by: Universal Music Group

Who actually owns the music?

How does Spotify pay?

Spotify doesn’t pay the artist by the amount of listeners that listen to the song over time but instead they use royalty pool. According to Daffodil software ” Spotify distributes nearly 70% of its total revenue to rights holder.” which means that Spotify keeps the 30% of the money that comes from the song for themselves and give the other 70% to the record label and the artist. So if the song got 1 million streams the amount of money that is made would be between $2000 to $5,000 and it will be give to the record label first and distribute the money based on the contract they have with the artist.

Types Of Royalty

There are different types of royalty. According to Indie Music Academy, ” There are different types of music royalties, including mechanical, performance, and master recording royalties” . Mechanical royalty is payed by the amount of copies the song has, performance royalties is payed when the artist play their songs to the public such as concerts and also streaming platforms and master recording royalties is when the payment goes to the table that own the song. Company like BMI used performance royalties and pay the songwriter which means that when ” Bruce Wayne” is played on stream, Youngboy got some amount of the money but Warner music gets the most of it.

The Big 3 industries

  • Universal Music Group
  • Warner Music
  • Sony Music Entertainment

These three companies have control of most popular musics we listen today even though the streaming sounds free and modern. Spotify makes money primarily from subscription and advertisement. thus creating business model by combining technology , media and business. from total amount of money Spotify pays 70% to the right owner of the song which usually goes to the record label before it goes to the artist. this is an example of how the Music is now dependent to technology and keeps maintaining a financial grip to big businesses . one of the benefits of streaming Is making the song accessible where everyone can easily find songs they want to listen with lower price on Spotify compared to buying CDs and also it gave the artists an opportunity to stream their songs for the whole world but not only in local areas. on other hand, one of the disadvantage if the streaming platforms is that the artists are getting paid less for each stream which means that even the most listened song won’t make that much money to the artist compared to the record label or it might not even make as much as what Spotify makes from the song and also most of the money is controlled by the big companies, which have most influence on music people listen to. This system can be harsh for artists that are independent because they will struggle with making income and also it will be hard for them to get publicity in streaming platform. This shows that just because people can post their songs into platform, that don’t mean their song will get audiences quickly.

In conclusion, while streaming plarfotm such as Apple Music, and Spotify have changes the way people can have access to musics and let artists to get to people without having any traditional gatekeepers, the distribution of Money and power has shifted to where record labels now have more control and get more money from the song than the actual artist. The steaming platform has made it easier for listener to pay a few amount of subscription to listen to any songs they want but that affects the musician financial that some might stop doing it. the new system is working well fr the company than the musician.

References

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