The Rise of Streaming, Impact on Artists & Labels, and How to Adapt


cloud-musicUnless you don’t work in the music business or you were on Mars for the past year, you’ve heard about it: streaming is on the rise, but unlike downloads which were more or less a transcription of the physical world into digital, streaming introduces totally different paradigms. Let’s have a look at them and their impacts on artists and labels.

Download & Physical = Ownership Model / Streaming = Access Model

When you buy a physical or digital copy of an album, you buy it at a specific price and only one time. Then depending on how much you like the album you bought, you listen to it 2 times or 1000 times. With streaming, you no longer buy an album, but each of your listens (of more than 30s) generates royalties for artists and labels, and these royalties are paid either by advertising if you are on an ad supported model (YouTube, Spotify Freemium, etc.), or by a monthly subscription if you have subscribed to a service.

So in the physical/download world, the main lever is to get more buyers. In the streaming world, while you also want more people to listen to your music, you’re hoping these people listen to your music more often, too.

We all remember the 90’s, when we discovered a really good song on the radio, bought the album without having listened to it and the only worthwhile song from the 8 or 12 tracks was that radio single. In the streaming era, this shouldn’t happen anymore: because you have access to whatever music you want, unless you are dedicated masochist you will theoretically only listen to the music you love. That’s a big difference: even if a hit single can always help build awareness, each of your songs has too be good enough to be listened to repeatedly.

The second big change is you can release songs in the format you want and when you want. You no longer need to have a full album of minimum 30-40 minutes ready; each time you have a new song, you can — and should — put it “live” and build awareness around it.

This strategy makes even more sense for new and developing bands, as they can start to drive revenue with their first songs. Indeed, unlike download and physical revenues, where you see a big peak around release date (X buyers x $10), in the streaming era, even if you can still observe a peak around release due to curiosity/promotion, you should continue to observe pretty decent and regular streams over time (1+1+1+1).

In the download/physical world, release is the end of the process. For streaming, it’s just the beginning. As an artist or label, this translates into quite a big change in your cash flow, especially if you are used to getting substantial physical pre-orders. With streaming, you will need more time to recoup your initial investments, BUT revenues will last longer, and as such, streaming adds value to catalogs on the whole.

To capitalize on this, it’s a good idea to release new songs immediately, followed by remixes and B-sides so you can continuously build your catalog and as such, your revenue long-term.

Playlists and Socials: Sharing Is the New Promo

When speaking of promo, I always picture this: before the Internet, choices came from the top and as a consumer you could only choose between what labels, radio stations, TV stations and stores had selected for you. Now, with both Internet and the growth of streaming, choices are increasingly coming from the bottom — from the fans, through viral sharing, on socials… Of course, you still need people to love and pick your music to bring it to others, and the bigger/more influentials that “dude” is, the better it is for your music; but you don’t necessarily need to wait for the “Big Dude” of the Music Biz anymore. Everyone and anyone can help you spread your music by posting it on Facebook, Twitter, and adding it to their playlists. And who knows, perhaps at the end of the day, the “Big Dude” will listen to your music and like it, too.

One tip on sharing: be emphatic. Think about what you would like to see on socials from your favorite artists and labels, and don’t hesitate to highlight other artists — known or unknown — you like and “tag” them. Perhaps they will also love what you do and return the favor.

To conclude, I’ll leave you with this: Always be sincere and never abandon the music you like to try to please more people. If it’s honest, you’ll find your fan base and it will be more loyal and dedicated for it. Now, welcome to a world of profusion and to the Sharing Economy!

2 Comments

Binny Sharma

The great way to view the massive streaming numbers is that YouTube, Spotify and the rest are cannibalizing digital music sales – a trend that is likely to accelerate an E-Music Industry. It was the time of 90’s , when people bought CD,cassettes for their favorite songs/albums. It’s fragile material need care to preserve the song quality.
The rise of streaming change this strategy, you can find songs of your choice whenever and in whichever format you like. Free from the anxiety of preserving this. As, it maintain its own listening standard.

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