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I’m in the midst of a love affair with a music subscription service. No sooner had I thought of a song than it began playing. From synapse to speaker in an instant. As a listener, this is amazing and I’m well aware of what a privilege it is.
Why a privilege? Well, for artists, music subscription services aren’t a particularly good deal. In fact, of all the ways you can monetise your work as an artist, music subscription services are the least profitable.
According to the beautiful infographic by David McCandless which visualises the different monetisation methods available to artists and how profitable they are, revenue made from music subscription services such as Rdio; Spotify; Rhapsody; Pandora; MOG; Grooveshark and Last.fm is the least lucrative. If you’re a solo musician, at US$0.00029 per play on Spotify, you’ll have to receive a staggering 4 053 110 plays per month to earn the US minimum wage of US$1160.
So why do they exist? For major music labels with a lot of high profile artists, music subscription services are slightly more compelling. In the case of Spotify, for every play that an artist on their roster receives, the label makes 5.5 times that of the artists, or US$0.0016 per play. That’s about US$6 500 for the above mentioned scenario. Additionally, labels receive a percentage of the subscription fees paid by premium account holders or from adverts displayed in the free versions of the services. A portion of this income is disseminated to the artists, despite these additional revenue streams, however, music subscription services remain a low income deal for artists.
Much has already been written about the per-play model’s exploitation of musicians but in the end, in a time where any song can be downloaded illegally at a whim, any form of additional revenue remains welcome.
Ultimately, the big winner here is the consumer. Let’s look at the top 8 ways in which music subscription services are rocking our worlds.
• Cloud backups
If you’ve ever lost your music collection to a hard drive crash, theft or act of God, you know what it feels like to die a little bit inside. With music subscription services, you won’t have to worry about that happening again.
• Try before you buy
Music subscription services allow you to get intimately familiar with a song, album or artist before ultimately deciding to purchase anything for offline listening. The model also allows you to listen to albums you might be moderately interested in, but would never buy. Instead of justifying a torrent for this reason, you can listen to your heart’s content without the guilt.
• Access anywhere
You have access to massive catalogues of music (15-million songs — Spotify, 10-million songs — Rdio), as long as you have an internet connection.
• Discover new music
Rdio and Grooveshark, for example, have built-in music recommendation services. Much like Amazon suggests items for you based on previous purchases, Rdio recommends music that you might like based on what you’ve been listening to.
• Re-discover music
This past weekend I had a trip down memory lane during which I re-discovered the old Incubus albums which were the soundtrack of my youth. My original CDs have long since been lost.
• Social aspects
Spotify allows you to share playlists, and Rdio allows you to follow users with similar musical tastes. The comment, statistics and review systems inherent in these services are brilliant. They allow good music to bubble to the top organically while at the same time enabling deeper engagement with the community.
If you can think of a song, you can play it immediately. There’s no shopping, buying or downloading.
• Financial sense
In terms of Spotify or Rdio, for US$5 a month for access to music on your computer only, or US$10 for mobile access, music subscription services are good value for money. This is especially so if you’re the kind of person that buys more than 6 albums per year. In a household, although the services don’t allow concurrent connections, sharing an account with your spouse also makes a lot of sense.