New Model, Same Old Stories?

Royalty Payments as the Economic Measure of Fairness

A commonly attempted approach to answer this question is purely financial and concerns royalty payments to recording artists. Arguments about music streaming in journalistic and vernacular accounts center around concepts of “fairness” and “transparency,”³³ with the rate of payment to rights holders for usage of songs and recordings receiving particular attention.³⁴ While these outputs impact holders of sound recording and song copyrights, it is common to see rhetorical arguments reduced to how musicians and songwriters are paid by commercial streaming services. Two discursive subtleties are important to note here: the framing of these firms paying “musicians” and “songwriters” as opposed to “copyright owners” or “rights holders,” and a frequent comparison of digital streaming’s usage‐based revenue calculations to the older sales model of purchasing a personal copy of a recording for unlimited personal use. These strategies are used to imply that streaming services (Spotify in particular)³⁵ are unfair to musicians broadly and in need of more “democratization.” However, these critical accounts typically present comparisons to the larger amounts paid for ownership for unlimited use as a sufficient demonstration of past systems being more lucrative, and also often imply that the streaming services pay royalties to artists, not rights holders. Even well‐argued institutional research papers on the topic of streaming revenue rates use “fairness” and “transparency” uncritically.³⁶ Moreover, the discursive focus on how musicians are compensated often completely neglects the issue of how record labels and publishers compensate the creators under contract. In many instances, critiques of Spotify’s rates of payments resemble older political economy arguments directed at the dominant record labels and publishers on whom their production, and ultimately their livelihoods, ostensibly depend.³⁷ When looking at the rates paid to copyright holders by Spotify, the oligopolistic powers remain significantly involved in the negotiation of how much is paid for copyright usage. The systemic role of record labels, publishers, and collecting societies in negotiating rates and paying royalties is often ignored.

Obfuscated elements of complex revenue structures further problematize arguments about payment rates. Rates paid to rights holders are based on sharing the revenue Spotify receives from subscriptions and advertisers in a territory, and the particular amounts paid to the rights holders are dependent on a variety of factors, of which we will mention only a few. The record label or aggregator service which has uploaded the recordings will have negotiated their own specific deal with Spotify, often under a non‐disclosure agreement. The performance rights organizations responsible for the collection of song royalties (which are defined differently around the world) negotiate the rate for their catalog in each territory. In different countries, copyright laws and structures will impact who can collect which rights and who can negotiate for those rights holders. Publishing mechanical royalty payments are handled quite differently in the USA than in other countries, for example, with the government directly involved in setting the rates. Since Spotify’s revenue pool is shared, paying more to one group of rights holders means less revenue for others. Ultimately, the rates paid to rights holders or aggregators per stream vary considerably. Demanding one group (songwriters for example) to be paid higher rates is arguing, in essence, that other groups (recording rights holders) should be paid less.

A second critical point concerns the deals between rights holders and musicians, including issues of artist royalty payments. The question of what a musician will be paid quickly becomes a query of who they work with. Record labels, aggregators, performance rights organizations, and even managers of the world’s most popular artist brands all compete with each other for their share of the available revenue from the platforms. Revenue studies will obtain different results based on methodology and sample. Still, even if a broader picture among groups can be seen in these large studies, given the heterogeneous concerns of performing musicians, songwriters, recording engineers, managers, rights holders, concert promoters, and countless other stakeholder groups involved in the music business, the search for a grand narrative of democratization or democracy upon which everyone can agree will remain elusive using rates of payment.

Access to the Marketplace

A second measure of the economic impact induced by music streaming is the one of access to the marketplace. In that sense, music streaming represents a major structural shift. Digital technology allows musicians to produce and distribute their recordings with relative ease, especially in the context of the transition from the ownership model to access.³⁸ The historical difficulty for producers to get releases into retail stores alongside that of major‐label albums was famously the concern of smaller record labels and unsigned artist brands in the pre‐internet area, when recording was prohibitively expensive and mainstream (physical) distribution dominated by the major labels. Nowadays, any producer can pay a small fee to put their music into the streaming platform catalogues and receive some revenue for it. Spotify has reported that over 40,000 songs are uploaded to their ecosystem each day and the vast majority of recordings will fail to generate enough usage and revenue to pay for this fee.³⁹ One example narrative is home recording artist Steve Benjamins,⁴⁰ who claims that he collects $400 per month without playing live, and his streams are driven through Spotify’s playlists and automated algorithmic recommendation tools. Benjamins does not work with a record label or hire other musicians. If we are to take this case as indicative of a modest new revenue structure (rather than hyperbole more in line with the viral myth that intermediaries are no longer needed), it points towards a production strategy created by platformization which is in fact more “democratic” from a systemic perspective. The case shows that Spotify’s discovery tools have created opportunities for a production method and level of investment which previously would not have found an audience at scale. And being that this is something new, which threatens existing revenue structures and incumbents, it is to be expected that status quo interests will resist or challenge the legitimacy of these kinds of stories as outliers, or the music as inauthentic. Admittedly, Benjamins provides an example of a specific narrative that has been difficult to confirm. Bearing this in mind, stories such as that of Benjamins should not necessarily be taken as proof of a new structure that is easily accessible to all, but rather a need for more research into how prevalent and accurate these new kinds of narratives actually are.

Coming on top of the question of “access” is the issue of “visibility” of recordings in the crowded marketplace of the digital music commodity. In order to get deeper inside the concept of “access” and what has and has not shifted, we look at the words of musician and activist Jenny Toomey, founder of the Future of Music Coalition, when internet technology was just beginning to affect structures of music industries in 2001:

Do traditional music business models serve musicians? In my opinion, aside from the cultural legitimization that comes with signing a major label deal, there are three need‐based reasons why musicians sign major labor deals. The first one is access to resources […]. The second reason is access to distribution […]. The final reason that artists are signing these deals is access to promotion.⁴¹

It is the second of these three forms of access, that of distribution in the sense of delivery from producer to listener, which streaming platforms have solved brilliantly. The access to promotion is related to how “discovery” works within the streaming interface and is the most interesting to explore. Generating sufficient interest in a song or artist brand to make them fashionable still requires investment and expertise. Regardless of their access to catalogues, producers face a saturated space where everyone aims at attracting users’ attention on platforms, with, in return, a lot of content that is never listened to. Streaming services have created infomediary ecosystems which mine, monitor, and mediate the way songs are used and presented.⁴² From the perspective of an artist brand, record label, or publisher wishing to see recordings promoted within the digital music commodity interface, the opaque nature of the sociotechnical intermediary easily leads to suspicion of influence on the process being wielded by the oligopolistic powers. The skepticism of oligopolies’ influence on the promotion/discovery process can be seen as the need for Spotify to democratize its access to promotion. This again extends old logics about corrupt or entrenched gatekeepers who are not being “fair” to artist brands or songs which are lacking in capital. The alternate view, which is only more recently starting to emerge through high‐profile cases such as Chance the Rapper⁴³ or more obscure ones like Benjamins, is that there are niches where unsigned artist brands earn revenue without the reliance on record labels, other promotional services, or even performing concerts.

From our brief exploration of the economic aspect of the music streaming model, we note that the focus either on royalty payments or on access to the marketplace produces different results in the evaluation of said model as a potential for a more democratic popular music market. Pointing out the micro‐payments of commercial streaming services or the new possibilities for unsigned “amateur” artists to share their content on streaming platforms are only examples of structural reconfigurations in the production and distribution of popular music. Moreover, framing debates about revenue rates as directly between artists/songwriters and the services extends old logics around the ideology of stardom, which seek to conceal the professional mechanisms and labor involved in the commercialization of recordings and artist brands.⁴⁴ Under this ideology, success is due to the amazing charisma and talent of artist personas, while failure is accepted as the natural outcome for those who lack those rare gifts or who fail to connect with the right stakeholders who can nurture and develop them. This both hides the role of music business workers and distances their effort from the outcomes.

When particular stories of economic success or failure become the basis upon which to construct an evaluative narrative of streaming music, then we find that these narratives are in fact rooted in other assumptions as to what an ideal situation should resemble, but which are never fully established and fail to acknowledge the underlying design of recording industries to overproduce in search of a few stars, alongside the mass failure of most commercial releases and artist brands. In the case of royalty payments, what would a “fair” redistribution consist of, and to whom should it be paid? In the case of the streaming marketplace, who should be able to put their music into the ecosystem and benefit from it? Here is where the perspective of the “platformization of cultural production” becomes helpful.⁴⁵ Should artist brands and songwriters optimize their production for the platform, as opposed to the audience or individual listener? Whether “platformization” is seen as positive or negative for the music industries broadly relates to the question: should commercial sustainability continue to be contingent upon stakeholder experts and intermediaries to locate and develop stars and hit songs, especially given the high rate of failure? We argue that different answers to these questions can be uncovered, and they are determined by the particular approach that authors have of music and its relationship to either a democratization of culture or cultural democracy paradigm.⁴⁶ In the next section, we continue on our critical overview of accounts framing music streaming’s changes, but this time, in cultural terms.

Taste and Consumption Practices

With the shift towards audience studies in the 1970s and 1980s, consumers of culture have been described as possessing a certain autonomy.⁴⁸ Scholarly accounts of audiences’ ways of doing align with a cultural democracy position.⁴⁹ In the case of music, this translates into the following question: “what does [music] make people do?”⁵⁰ When interrogating audiences, scholars do not focus on the type of cultural content that is listened to as much as they question 1) the contexts within which listening practices are “performed,” and 2) what happens within the interactions with music, with the idea that music represents a “capacity for social action.”⁵¹ As such, listening practices are discussed in relation to how affective outcomes emerge. Music is understood in relation to its use value, meaning that it is valued by consumers, and therefore socially valuable, because it enables, accompanies, and affects.

In the age of music streaming, the presence of music in everyday life is said to increase.⁵² Streaming services ensure a continuous musical flow by providing a playlist that fits every aspect of one’s daily routine. The technological means to access and listen to music are understood as offering more options to manage an everyday accompaniment of music. A cultural democracy approach to music considers listeners as competent in their choices of music content that is suited to the different listening practices carried on in their everyday life, in direct contrast to the recording industry view that experts and intermediaries are needed to help listeners choose “the best music.” Automated algorithms that organize recommendations present the potential to increase individuals’ access to music, for instance through suggestions of automated playlists that aim at capturing a particular mood. However, algorithms construct user profiles on the basis of a pre‐existing repertoire of preferences and proximity with other users.⁵³ In that regard, music streaming cannot necessarily be seen as the tool that will transform every user’s taste one way or another. The aim of the commercial services is to get users to pay a monthly subscription. They do so by deploying algorithms that suggest content that must feel new, but also cannot be too different from the songs they usually listen to.

The process for artists to feature in playlists on streaming platforms is somewhat opaque, and it has been recently reported that rights holders attempt to influence playlist curators through “pitching” releases.⁵⁴ With algorithmic tools also involved, the curation of playlists is still seen as a new version of pitching radio programmers, magazine editors, or record store retailers to feature certain songs or releases over others. For producers unable to get their songs onto these playlists, the process seems unfair and in need of democratization. These criticisms echo old narratives of the corrupt influence of radio promotion companies and major labels.⁵⁵ The extension of older recording industry concepts frames these tools of recommendation and curation as new sociotechnical intermediaries which are needed to add value to songs, and can be influenced through strategic campaigns of influence, extending the old logics around publicity, promotion, and marketing. In this frame, the producers are still optimizing music for audiences. Alternately, the platformization view would portray these same streaming services as platforms: novel structures which require different production approaches than cultural intermediaries. This view also constrains the formerly vital role of recording industry stakeholders in favor of the platforms. Whether seen as new versions of old intermediaries, or as novel platforms, the end result is that the way artist brands, albums, and songs are selected into playlists and other automated recommendation features is a process that remains curated and mediated for users. Now the question is whether this very process of curation and mediation is seen as a necessary form of imposition of certain artists and songs onto users’ everyday listening practices or a mere suggestion as to what content can be a better fit with what everyday activity.

The importance of music streaming as a mode of music consumption raises an important theoretical conundrum. Eric Drott for instance argues that even the desire to consume new music needs to be manufactured, implying that the urge to hear new music is itself fabricated in the interest of platform capitalism.⁵⁶ David Arditi goes further by arguing that the ubiquity of music as organized by streaming platforms means that we are “inundated” with music.⁵⁷ The “digital music trap” commodifies our everyday existence, turns music consumers into music users, and makes us pay for music with cash or data for access to a platform. Arditi’s critique of music streaming aligns with a democratization of culture perspective, whereby the techno‐cultural infrastructure (here, streaming services) entraps and dominates its users by imposing a continuous stream of music.

A cultural democracy perspective would instead highlight how streaming platforms enable (to some extent) different “independent units”⁵⁸ to better connect and feed each other’s taste and practices. Moreover, the autonomy of music consumers means that they are given more opportunities—through access to a large catalog of music content—to find the music that is better suited to their everyday tasks and with the aim of an affective outcome. The opposition between the two paradigms points to a different approach to the issue of the value of music in the age of streaming, which we explore more closely in the next section.

Music’s Presence, Listeners’ Attention … and Regimes of Cultural Value

The issue of the value of music has recently become of prominent significance across scholarly publications.⁵⁹ The question is not so much about whether the cultural value of music has evolved over time, since we can simply point to the historical and cultural evolution of popular music, its division and development into various genres, its increasing presence within societies, and the evolution of technologies that enable humans to produce, distribute, and consume it. Instead, the question lies in whether the increasing “ubiquity” of music transforms how we value it in a non‐econometric sense, or: does the presence of music in contemporary capitalistic societies—and especially mediated by streaming services—make it more valuable to people, or less valuable?

While we witness a resurgence of publications on the issue of music’s cultural value, and particularly in relation to its association with streaming platforms, we first need to ask whether music streaming constitutes a point of rupture. Of course, all authors would point to the genealogy of digital music as laying the grounds for the current organization of music streaming. Nevertheless, there may be something specific to music streaming in the age of platform ecosystems which would tip the issue “over the line.” For instance, while Arditi acknowledges that recorded music has always been a commodity, the current techno‐economic infrastructure, which he analyses as a “digital music trap,” further commodifies music. He writes: “the digital music trap allows for the perpetual exploitation of listening‐labor through the expanded means of music consumption.”⁶⁰ Likewise, in Hesmondhalgh and Meier’s cultural history of the evolution of digital music, we find that the third “moment” that is characterized by the dominance of IT companies may result in a “loss” of “music’s power.”⁶¹

In those critics, we note two dominant issues that are somewhat located into the technological infrastructure of music consumption: first, there is a loss of music’s economic value (we no longer pay for units); second, the ubiquitous background presence of music means we do not pay attention to it, which reduces its emotional force. On that later point, Lee Marshall draws on a neo‐classical approach to value (stipulating that people need to be “aware” of objects) and notes that “the idea of ubiquitous listening can contribute to an explanation as to why many individuals may not view music as particularly valuable, especially given that, by definition, this kind of musical experience exists on the periphery of an individual’s consciousness.”⁶² Tying those two issues together, he adds that “it is not difficult to see why peripheral awareness of low‐intensity musical experience may result in most people thinking that music is not worth paying for, or at least not paying much for.”⁶³ A key concept that is present across the accounts of Arditi, Hesmondhalgh and Meier, and Marshall is the one of the “average listener,” which somehow enables them to speak on behalf of a disembodied collective of individuals. In that regard, the issue of music’s ubiquity is understood as having a direct correlation with the one of “attention,” which is itself constructed as a monolith: background music means “no attention.” Such critics are reminiscent of the democratization paradigm, whereby music listeners are constructed as a whole body of passive consumers.⁶⁴

The cultural democracy approach to music as defended by the likes of Hennion or DeNora emphasizes the emotional forces of music as experienced by competent and active individuals.⁶⁵ To David Looseley, this is a narrative about music’s “expressive value.”⁶⁶ Although authors in this paradigm largely fail to provide a true perspective on how technological means to music consumption play a critical part in how individuals access and listen to music,⁶⁷ there is an underlying assumption that technologies such as CDs, MP3 files, and now streaming platforms do not “dominate” consumers as much as they offer pathways through which musical explorations are possible. While this perspective provides very little insight on the actual structural organization of music distribution, it directly opposes the view that music’s emotional force results from a domination from the top, a rather philosophical challenge to the anxiety about the need for intermediaries to help identify appropriate canons. Instead, it considers individuals’ affective responses to music as the basis upon which any discourse on music’s emotional force and cultural value becomes possible.

The different perspectives on value certainly make the two paradigms (democratization of culture and cultural democracy) quite apparent in how different authors approach the issue of music’s contemporary value. The question that remains is the actual role that is to be attributed to streaming platforms in the changes (for better or worse) to music’s cultural value. As Marshall contends, “it is possible that new digital technologies have simply revealed some of the underlying social dynamics of music listening rather than causing any kind of cultural devaluation.”⁶⁸ What is certain, however, is that those conversations will continue to develop over the coming years.