TechnologyPaul McAleer

Cross the Streams

TechnologyPaul McAleer

It's been made pretty clear over the past few weeks that streaming music is not a sustainable business model for artists. Streaming Music is Ripping You Off. Open the Music Industry's Black Box. And the fact that you need to play a song 1.8 gazillion times in order for an artist to earn enough to buy penny candy (which costs a quarter).

In other words, this is horrible. But! From a user's perspective, streaming music has a lot going for it. It's eating away at pure digital sales and has been for some time. In other words, tech got the user model exactly right, and did nothing for the business model.

That's not to say that was a goal of rdio, Spotify, Google, Microsoft, or even Apple. It's pretty clear that the music industry has an entrenched way of doing things, and change – on any scale – is difficult.

That all said, I see one natural conclusion for streaming services: they'll become music labels.

It will be a slow change, due to contracts and deals and the like. But think about it. They've got the distribution in place on the software and, in some cases, hardware side. They can, in time, provide exposure in a way a music label could not. Apple has already been producing music videos for some artists. Contracts aside (and, again, those are a major aside) it's only a hop, skip, and jump to having Drake cut a new single and having it solely on Apple.

That means a very different future landscape if it happens. It means that some services – stores, if you will – get exclusives and artists all to themselves. Or, they get them first. That sticks a very smart wedge in the “every streaming service has the same catalog, more or less” scenario we're in now.

Truth be told, I can only see Apple pulling this off at scale given their current marketing stance. My serious problems with the app and UX aside (again, another major aside), they've very much planted themselves in the “we're for artists!” camp with the Connect feature and initial launch positioning.

Tidal is interesting. Their pro-artist stance hasn't been the #1 focus for them. Apple calls it out as a key differentiator: “We've set out to make music better. ... To deepen the connection between artists and fans.“ Tidal, on the other hand, focuses on streaming quality which, ultimately, is not enough. (See: Pono.)

Now, this all said, it's entirely possible that Apple is just spending a ton of cash on marketing for a streaming music service that's an also-ran with its own radio station. But its ability to pull in talent, its huge cash reserves, and alleged attitude towards music suggests that they're looking to do something more.

And by becoming a label themselves, Apple could – again, in theory – change the pay equation for artists. Say... 70/30. Or 80/20. Otherwise, it's all looking pretty bleak.