Before escaping the British Summer monsoons for the more reliable sunshine of the Turkish coast, I dropped in on Chinwag’s music event, titled, ‘Who pays the piper?’
Quite an interesting discussion from the perspectives of those across the new value chain - the world of digital music.
As Dom Hodge, from music consultancy Frukt Music, noted “We’re not in a TV or radio age any more - it’s not about push.”
Indeed, now that music is firmly entrenched in the ‘free content is expected’ online world, the drive for revenues is challenging to say the least.
Case in point - when asked how many people in the room use the Spotify streaming music service, nearly all hands went up. How many paid the premium rate? One. Ouch. The sales director wasn’t easily discouraged, however, citing that new premium services coming soon would sway site visitors into spenders. Will CD-quality downloads and exclusive new music features be compelling enough? If the company can capture the excitement of its new iPhone app for their premium services, there may be hope. Yet recent revenue figures indicate otherwise with reported earnings of 14 pence per user per month.
The alternative? Many suggested that brands will foot the bill via ads or sponsorships. Media buying powerhouse MediaCom’s Richard Jacobs believes they will play a part. “My brand clients are ultimately going to fund the free download or streaming of digital content,” he said. But he also noted the limited reach and low audience participation per download and as such said, “while we are largely positive about these services we have to keep a keen eye out on behalf of our clients.”
Lest we forget, the artist, creator of this valuable content, reaps a very small portion of the money around it.
“Record companies get paid ten times as much as artists for revenues from streaming music,” according to journalist and musician Helienne Lindvall. “YouTube? I have never seen anything show up on my PRS statement.” She believes that if fans knew the truth about how little artists are eventually paid, that they would be happy to pay artists directly.
Event chair and blogger Steve Bowbrick added to this idea by suggesting a ‘Fairtrade’ type of accreditation for music sites which gives fans assurance that when they buy music or services from that site, the artist will be paid.
All interesting to ponder and a little like my recent holiday - do we do the ‘right’ thing, support the local British economy and minimize our carbon footprint by staying in the UK and going on a camping holiday or to the beaches of Devon? Or take the cheaper, sun-guaranteed alternative of the beaches of Turkey? Sun in July wins. For the music industry, there will be rewards for those who strike the perfect balance of offer, experience and value.