This week, Taylor Swift shocked her fans and the music industry by removing all of her songs from Spotify. The move was seen as an effort to drive up sales of her new album, 1989, but the decision also appears to reflect her belief that artists should be able to set their price points for albums.

“I’m not willing to contribute my life’s work to an experiment that I don’t feel fairly compensates the writers, producers, artists, and creators of this music,” explained Swift, “and I just don’t agree with perpetuating the perception that music has no value and should be free.”

In a blog post, Spotify CEO, Daniel Ek responded, “Taylor Swift is absolutely right: music is art, art has real value, and artists deserve to be paid for it…Our whole reason for existence is to help fans find music and help artists connect with fans through a platform that protects them from piracy and pays them for their amazing work.”

The question then becomes, in a consumer culture dominated by streaming and digital downloads, can music still have value?

Spotify pays artists an average of $0.007 per stream. While this is not a one-off payment and artists make money every time one of their songs is streamed, a fan would have to stream each of 1989’s thirteen tracks more than a hundred times for Taylor to see the same returns as she gets selling a single album on iTunes for $9.99.

However, maybe the music industry isn’t as devalued as Swift fears. If you look at most successful authors now, they are getting most of their earnings from paid speaking engagements. Similarly, for musicians, the live-touring business grew four times in the last fifteen years. So as the value of reproduced music has gone down, consumers have access to more music than ever before, and are willing to pay more for the live experience.

Thus, perhaps the value of music has not gone down, perhaps the way we traditionally appreciate it that has changed. In fact, even Taylor Swift makes the majority of her earning from touring. Through tours and ticket sales, artists still have an avenue to set their own price for their art.

Regardless of industry’s concern, streaming culture is here to stay. 1989 may have sold 1.3 million copies in the United States in its first week, but Swift’s unprecedented success is truly the exception that proves the rule. 1989 had the biggest sales week since The Eminem Show in 2002. Furthermore, 1989’s success makes Swift the only artist in history to have three albums sell one million copies in a week in the United States. CD’s aren’t selling like they used to as consumers are increasingly streaming their music.

Thus, Taylor’s rejection of Spotify should not become the dominant response to streaming if lessons of the past are to shape the future. The music industry fought a futile war against consumer preferences once before: when digital downloads initially took hold, the music industry’s response was to ignore the downloads and attack their customers with thousands of copyright lawsuits. However, it was the business models that embraced digital downloads, like iTunes, that flourished. Similarly, continued engagement with streaming is the best way to ensure future revenue streams for artists today. No amount of copyright enforcement, attempts to restrict or control consumer access to music, or nostalgia for the pricing power of the past are likely to alter this.

Megan McLean

One Response to Music Streaming & the Music Industry: Everything has Changed

  1. Chelsea Fitzgerald says:

    I completely agree with your point that the way artists receive compensation for their music has changed since the advent of digitalization and the ease with which consumers can click and download (legally or illegally) copyrighted music. One of Taylor Swift’s most lucrative contracts is with Coca Cola, representing Diet Coke in their advertising campaign. She was undoubtedly able to secure this position as a promoter for the brand because of the popularity of her music. Whether people were listening to her for free on the radio, Spotify, or Pandora (I assume she’s still on Pandora?) or paying for her music instead– it is clear that her fans certainly value her music and that economic rewards are flowing back to her, albeit indirectly and in a less traditional way.