Music For The Masses

Music streaming has brought a lot of personalization to the experience of listening to music. Faced with the challenge of differentiating their service from competitors featuring substantially the same catalog of music, at a de facto standard price point, streaming services have focused on developing ever-more precise tools for personalizing the listening experience in the hope of keeping users engaged. So, Spotify has its playlists, Apple has its curators, Pandora has its music DNA project.

His_Master's_VoiceMusic rights owners too, in their approach to the streaming business, have also encouraged personalization. Burned badly by free music “sharing” sites, the record labels have been more than happy to reinforce the streaming services’ efforts to turn listening into a personal — and solitary — experience, such as by curating their own Spotify and Apple playlists.

Digital technology itself has also contributed to the bias toward personalization. Use of streaming services is heavily weighted toward mobile devices, particularly phones, which by design are personal, and in general highly personalized devices. Digital distribution also generates the sort of highly granular usage data on which personalization tools rely.

All that personalization has come at a price, however. With everyone cocooned inside their own playlists and cut off from the outside world by earbuds, the communal experience of listening to recorded music with friends or family has become a rarity. Read More »

For Music Biz, First-Half Results Are A Glass Half Full

The Recording Industry Association of America this week reported that U.S. music sales through the first half of 2012 were up 8.1 percent over the first half of 2015, to $3.4 billion, the industry’s strongest rate of growth in more than a decade.

iphone-artist-spotifyThe surge was due almost entirely to a whopping 112 percent increase in revenue from paid streaming services such as Spotify, Apple Music, and Tidal which more than offset a 17 percent decline in digital downloads (including albums, single tracks, and kiosks), and a 16 percent decline in sales of physical formats (CDs and vinyl).

Revenue from free interactive streaming, such as Spotify’s ad-supported tier, YouTube and Vevo, grew 24 percent but remained a tiny slice (5.9 percent) of the overall revenue pie. Revenue from non-interactive streaming services, primarily Pandora, was up 4 percent.

“Streaming in all its forms accounted for almost half of all recorded music revenues in the first half of 2016,” RIAA CEO Carey Sherman wrote in a post on Medium. “This represents a remarkable transformation and reinvention by a business that was principally physical products just six years ago.” Read More »

A Measure of Success: Frank Ocean, Netflix and the Value of Data

Frank Ocean’s surprise release “Blonde” debuted at No. 1 this week on the Billboard Top 200 album chart, racking up sales of 275,000 units, despite its not being released as an album in any physical format.

frank-ocean-blonde-x750So what were those 275,000 units? Some 232,000 of them were paid digital album downloads, according to Nielsen Music. The other 43,000 consisted of “equivalent album units.”

Say what?

An “equivalent album unit” (shouldn’t that be “album-equivalent unit?) is a metric devised by Billboard in 2014 to accounting for streaming activity and individual track downloads for charting purposes. Ten individual track downloads from an album as measured by Nielsen, or 1,500 on-demand streams of individual album tracks as reported to Billboard by the major streaming services, are counted as an equivalent album unit. In the case of Blonde, individual track downloads were not available at the time of the albums initial release, but they accrued 65 million streams. Dividing that 65 million by 1,500 yields 43,000 equivalent units. QED. Read More »

Music In the Antitrust Crosshairs

File this one under “be careful what you wish for.” Two years ago, a group of major music publishers, along with ASCAP and BMI, which collect performance royalties on behalf of songwriters and publishers, asked the Department of Justice to consider changing how it enforces the antitrust consent decrees that have governed the two leading PROs, to allow publishers to withdraw digital rights to their repertoire from the PRO blanket licenses.

DOJ took it under advisement and this week gave its answer, according to a report by Billboard, and it was not at all what the publishers were hoping for.

elizabeth_warrenUnder the decrees, ASCAP and BMI are not allowed to pick and choose which songs in their catalogs to license. They must either grant a blanket license to the entire catalog or not at all. Thus, if a song is in their catalog for one use it’s in it for all uses.

The publishers raised the issue because they were unhappy with the royalty rate that internet radio services (cough — Pandora — cough) were paying under the compulsory performance license available to broadcasters, including internet broadcasters. Those rates are set by the rate courts that oversee the consent decrees and get collected by ASCAP and BMI. Having failed to persuade the courts to raise them, the publishers wanted to be able to withdraw digital rights to their songs in the PROs’ catalogs and negotiate directly with internet broadcasters.

This week, according to the Billboard report, DOJ said no. Read More »

Return Of The Gatekeeper

Making content available on-demand was supposed to put the consumer in charge. Armed with “personalization” tools and backed by social media filtering the viewer/listener/reader would be king, usurping the power of traditional gatekeepers.

But a funny thing is happening on the way to the throne: consumers increasingly are inviting gatekeepers back into the realm, albeit not necessarily the same ones they had overthrown.

guard-buckhm-palace-shst_w_755Speaking at MIDEM this week, MIDiA analyst Mark Mulligan reported that “The percentage of people who make their own playlists on streaming has dropped by 10 percentage points in just one year,” said Mulligan. “The main playlists which people are using are the playlists which are being pushed to them,” by the streaming services, or in some cases by record labels.

Citing data provided by Spotify, Mulligan noted that in December 2014, Spotify’s Today’s Top Hits playlist had 2.3 million followers and generated 35.4 million streams per month. By April 2016 it had grown to 7.8 million followers and was generating more than 120 million streams a month. Read More »