Have Streaming Services Worsened the Quality of Music Today?

SOURCE: Slate

The economic principle I’m exploring is “People generally respond to incentives in predictable ways.” My research question to help me study the economic principle is “How does the music industry incentive artists to make popular music?” The article published in Slate titled “The Spotify Effect” demonstrates this economic principle by showing how the streaming age has affected the way artists are paid for their music, and arguing that streaming services have depreciated the value of some music. 

First, in the current age of digital and streaming music, artists have been making changes to “how they make songs and assemble albums to optimize streaming.” As I studied in my previous blog posts, streaming services like Spotify and Apple Music have completely taken over the music industry- and this has had both its positive and negative effects. Although streaming services have revolutionized the way we listen to music today, it is clear to see that there are still some considerable negative impacts to constantly having any music right at your fingertips. Artists today have to be “more reliant on touring and selling merchandise” to make money as streaming services often make getting paid dicey for artists and labels.

Next, when examining how streaming services actually pay artists, it is clear to see how the value of music can depreciate due to these services. With streaming services like Apple Music and Spotify, members have to pay a $10-$15 subscription fee every month. What I find interesting is that only about 30% of the subscription fee goes to the actual streaming company. The other 70% of that is “directed toward the music labels.” Once that money is given to the labels, it is still divided further before anyone gets paid. An artist signed to a major record label will probably only get about “12 to 15 percent” of that for every stream. Something else that I find interesting is that “ a platform like Apple Music… right now pays $0.0007 per individual stream” to the actual artists. Knowing these facts, it is easy to see why so many artists rely on touring and selling merchandise to make most of their money. It is also easy to further note that the way these artists are paid can have a drastic effect on the music they create.

Finally, the way that artists are paid through streaming services has a serious impact on the content they create. Because music lovers no longer have to buy an entire album just to listen to one of their favorite artists’ best song, artists now are putting more and more songs on their albums. What’s more is that artists have to consistently produce albums just to stay relevant in music. A prime example of both of these things is Drake, “one of the biggest pop artists in the world” who has to keep producing albums just to “remain in the conversation.” Drake’s most recent album, Scorpion had a total of 25 songs and was released just a year after his previous album. What we are seeing in music today reflects the choices Drake has made with his music and suggests an attitude of quantity over quality. This is the most obvious opportunity cost to artists and music in general as a result of streaming services today. What is important to remember however, is that “streaming is affecting different artists in different ways” and artists can still find success without conforming to the pressures of mainstream music today. 

In my next blog post I will research the question: This was my final research question.