# David Byrne on the Streaming Model



## KEnK (Aug 1, 2015)

http://www.nytimes.com/2015/08/02/opinion/sunday/open-the-music-industrys-black-box.html

Thought this was a valuable enough perspective to draw attention to it.
The gist of it is transparency is lacking and needed regarding where those meager
fractions of a cent per play go.

I also recommend his book, "How Music Works".
It's actually a collection of essays about the history of recording technology
and how in his view, (and mine) it has had an adverse impact on Music itself

k

-------

hey I was also reading on this just a few hours ago. Here is what I found out (below).

Regards,

Andre

---

On Pitchfork.com, David Byrnes continues calling for streaming revenues transparency:
QUOTE: *"Before musicians and their advocates can move to enact a fairer system of pay, we need to know exactly what’s going on."*

Byrne's piece, titled "Open the Music Industry's Black Box", outlines that it's nearly impossible to know how a listener's subscription payments get divvied up. He argues that knowing the full breakdown of revenues is key to creating a "fairer system of pay".

He discusses some of his attempts to contact companies like YouTube and Apple Music to have the revenue breakdown explained, but said those conversations hit dead ends.

I asked Apple Music to explain the calculation of royalties for the trial period. They said they disclosed that only to copyright owners (that is, the labels). I have my own label and own the copyright on some of my albums, but when I turned to my distributor, the response was, “You can’t see the deal, but you could have your lawyer call our lawyer and we might answer some questions.”

Other problems he posed are the "seemingly arbitrary" way labels have reportedly assigned income to artists on their roster, saying that the number of streams doesn't necessarily determine who gets the most money. He also says other avenues of monetization between labels and streaming services are hidden from artists, including "advances from the streaming services, catalog service payments for old songs, and equity in the streaming services themselves."

[Full Pitchfork.com article]
http://pitchfork.com/news/60632-david-byrne-calls-for-streaming-revenue-transparency-in-new-op-ed/

---

Byrne is on the Board of Directors for SoundExchange, the nonprofit digital royalty collection and distribution organization. He's been working with SoundExchange advocating for the Fair Play Fair Pay Act, "which would force AM and FM stations to pay musicians when their recordings are broadcast."


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## Dean (Aug 1, 2015)

Yeah,I have that book,..the man is a legend! D


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## KEnK (Aug 1, 2015)

I was surprised by reading a few of the essays in his book
that he seemed to look at recording technology as basically harmful to musical evolution.
That's a perspective I've had for a long time and never heard anyone else share.
Any thoughts on that?

k


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## Guy Rowland (Aug 1, 2015)

That's a terrific article. Echoes what Bono was saying last year, and what BASCA in the UK have been lobbying for. I'm delighted that artists as respected as David Byrne are asking absolutely the right, difficult questions (he owns a label and even he can't see what deals are done).

The simplistic streaming=bad polemic is so wide of the mark, and wastes so much energy in the wrong place (at least partially). I have an increasing suspicion that racketeering and collusion are endemic - all kinds of opaque and shady deals seem to be stuck between record companies and streaming companies. Maybe once the Feds have finished with FIFA, they can turn to the record industry...


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## creativeforge (Aug 2, 2015)

Oops, I just posted a blurb about his op-ed too... Didn't see this one...


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## KEnK (Aug 2, 2015)

Hey Andre,
I enjoyed your summary-
maybe combine threads?


Guy Rowland said:


> I have an increasing suspicion that racketeering and collusion are endemic - all kinds of opaque and shady deals seem to be stuck between record companies and streaming companies. Maybe once the Feds have finished with FIFA, they can turn to the record industry...


Hi Guy-
Yes, Byrne does have some interesting things to say on a variety of subjects.
Shady deals indeed, but let's not forget that musicians are often the first one's to shoot themselves in the foot.
I can't think of any other profession that can make that claim.

k


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## creativeforge (Aug 2, 2015)

KEnK said:


> Hey Andre,
> I enjoyed your summary-
> maybe combine threads?
> 
> ...



Hi, I never done this "merge" thing before... I hope it looks OK? Let me know!

Regards,

Andre


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## KEnK (Aug 2, 2015)

creativeforge said:


> Hi, I never done this "merge" thing before... I hope it looks OK? Let me know!
> 
> Regards,
> 
> Andre


Hi Andre-
The merge looks fine, except that you included your summary of the article in my OP.
It doesn't appear that you wrote that.
You ought to give yourself some credit for it.

k


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## chimuelo (Aug 2, 2015)

Josef Zawinul also believd too much technology allowed musicians to skip over the entire learning experience.
He hated MIDI as he described that it would allow lesser trained Pianists to layer sounds negating the need to have 2 hands of equal strength.
At that time I was layering 8 operator TX modules for walls of fat DX EPiano partials.
Great article too.
David Byrne took full advantage of video in a unique creative way.
And that drum & guitar groove on Burning down the house was a milestone back then.


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## rgames (Aug 2, 2015)

Everyone who discusses this topic should look up the meaning of "Loss Leader" to make sure they know what's going on. 

A loss leader is something that you lose money in order to entice people to buy something else. The "something else" is profitable enough that it covers the loss that you take on the loss leader. That's what music is these days - a loss leader. Companies like Apple and Spotify (eventually) lose money or break even on music sales so that their customers buy something else - like an iPhone. Loss leaders are the things you see in flyers for grocery stores and big-box retailers - really cheap stuff that gets you in the store. And while you're there, you'll pick up some other stuff that is profitable enough that, on average, the store makes money.

It all started with iTunes. Steve Jobs famously said that Apple doesn't make much money from iTunes. So, sorry musicians, we wish we could help you. But, in the meantime, we're going to become the world's most highly valued company selling these gadgets that USE the poor-performing service you provide. Of course, we're not going to share the profits from that side of the business. Loss leader.

Likewise with Spotify and other streaming services, none of those companies actually cares if it makes any money in streaming music. They want to monetize the service elsewhere. And they'll keep those businesses separate so they can continue to say "Sorry musicians, we wish your products would make money. But they don't. So we really can't help you."

It's total BS. If you're making money selling gadgets or advertising or whatever that uses the creative output of musicians then you should share those revenues with them. That's the ethical thing to do. But the precedent has been set with iTunes: music is a loss leader and musicians don't seem to care.

In any other industry this behavior would be a prime candidate for antitrust legislation (there's some of that starting to happen in Europe). It's market manipulation. Spotify and Apple don't give a darn about selling music. They want to sell other stuff that uses music. So they're not, technically, in the music-selling market. The fact that they control it is why it's an antitrust matter - if you're manipulating a market in which you have no interest so that you can make money in some other market, that's illegal (witness Microsoft and Internet Explorer in the 90's). And yet there is no wellspring of anger rising up against this behavior in the music industry (yet). Why not? Because the powers-that-be are controlling the conversation and making sure that everyone is looking at royalties. That's EXACTLY what they want us to do.

Nothing will change until musicians start to look at the ENTIRE business model that these companies use. That's what Apple and Spotify and their investors do. Forget about the royalties. Apple sells gadgets that USE your product and, ethically, they should pay you some of the revenues from that side of the business. Likewise, Spotify couldn't care less if they make a profit - why do you think they have so many investors for a business that's losing money and probably always will?

Answer: the music is a loss leader. In Apple's case, it's a loss leader for gadgets. In Spotify's case it's probably for advertising but who knows how they'll decide to monetize it. However they do, rest assured that they'll treat it as a separate business entity so that they can continue to claim that they're not making any money on the music and, therefore, pay next-to-nothing to musicians. "Sorry guys - wish we could help..."

We need to stop allowing our creative output to be someone else's loss leader. It's both ethically and legally the wrong thing to do. But as long as the focus of the argument is on royalties from streaming services (the loss leader) then we'll never get anywhere.

rgames


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## KEnK (Aug 2, 2015)

Geez Richard-

That's totally grim and spot on.

I've begun investigating what it may take to become a music therapist.
(How much instinct vs. accreditation is required)
This is something I've thought about for a long time.
I've had a couple of positive experiences playing for sick relatives.
Always thought of healing through music.
An entirely personal thing- no recordings, 
just a personal connection between me and one other person.

Your post makes me think that's an even better idea.

k


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## rgames (Aug 2, 2015)

I don't think it's grim - there is a solution. We just need to fight the fight that will make a difference.

Right now we're fighting the fight that Spotify wants us to fight because the outcome is clear to them (and their investors) and it won't affect their profitability.

We need to take ownership of the debate and move the focus away from royalties.

It's a classic case of power players creating a false debate (it happens in politics all the time). You think you're fighting against someone but, in reality, that someone is just controlling the debate so that he wins either way.

The only way to win is to change the topic of debate.

rgames


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## creativeforge (Aug 2, 2015)

rgames said:


> It's total BS. If you're making money selling gadgets or advertising or whatever that uses the creative output of musicians then you should share those revenues with them. That's the ethical thing to do. But the precedent has been set with iTunes: music is a loss leader and musicians don't seem to care.



Yes, true, and it started well before iTunes and the rest before. "It will give you exposure!" has been the mantra for artists who depend on a critical mass of sales. So you need to be able to track down what's going on behind the scene... you have all seen the Behind the Music episodes, or lived through a crash with a label, shady accounting, deceit, etc. 

MP3.com came on the scene with promises, but once it had built traffic and attendance it became very different, and eventually folded. We had put our music and hopes on its servers, it had grown exponentially, drawing investors, ads revenues, maybe also deals with music distribution and placement agencies, etc. Who knows what they were able to get out of it in the end. They are still at it, but I never hear their name or come across anyone mentioning them.

Others musicians have outlets, focus on specializing in an area, and so on, and avoid depending on winning the masses. 

Fascinating conversation for sure...


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## rgames (Aug 2, 2015)

creativeforge said:


> it started well before iTunes and the rest before.


There certainly were other ventures into making money from music via a promise of exposure but not by using it as a loss-leader (at least not to the extent that Apple did). For example, MP3.com wasn't selling their own brand of portable music players. Apple was the first to use music as a clear loss-leader for products in a lateral market.

Tower Records and its competitors were not selling their own brand of CD players or cassette decks or MP3 players, either - only the music. And they competed against others doing the same. That's a fair market.

Apple completely changed that model and wiped them all off the face of the Earth and musicians are now dealing with the consequences.

rgames


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## KEnK (Aug 2, 2015)

rgames said:


> Right now we're fighting the fight that Spotify wants us to fight because the outcome is clear to them (and their investors) and it won't affect their profitability.
> 
> We need to take ownership of the debate and move the focus away from royalties.
> 
> It's a classic case of power players creating a false debate (it happens in politics all the time). You think you're fighting against someone but, in reality, that someone is just controlling the debate so that he wins either way.


Richard- You're starting to sound like Chim! 
But you are absolutely right about what you say-
I stopped "loving" Apple a long time ago-
Now...


k


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## NYC Composer (Aug 3, 2015)

Actually, there is no way I can find to separate out music sales from Apple's iTunes sales figures from the iTunes store, which sells books, apps and various other media. Apple refuses to break out the sub-categories. What CAN be said is that the iTunes store recently generated 4 billion dollars in one quarter, and that some financial analysts have opined that the iTunes store will generate between 20% and 30% of Apple's revenue by 2020.

I realize that Apple has said in the past that the iTunes store was a break-even proposition. Demonstrably, that is no longer true. I try to keep up with Apple stock because as an investor in the market I am long Apple, and I try to analyze the ancillary revenue streams that add to the profits derived from their flagship product.


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## Daryl (Aug 3, 2015)

The big problem with a lot of Royalty based income is that although the collection agencies have huge power, they choose not to use it. I know that there was a case with Pandora that purported to accuse certain US collection agencies of running a monopoly, but of course that was BS, as nobody actually has to join a collection society. The first thing that needs to happen is that the collection agencies have to be instructed by their members to play hard ball. Increase the Royalties you pay or don't use our members' music.

D


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## NYC Composer (Aug 3, 2015)

Daryl, does anyone really "instruct" PRS? Certainly no one except the tippy top of the food chain in the U.S. can even get reasinable commubnication from BMI or ASCAP. Being non-profit has its privileges.


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## Daryl (Aug 3, 2015)

NYC Composer said:


> Daryl, does anyone really "instruct" PRS? Certainly no one except the tippy top of the food chain in the U.S. can even get reasinable commubnication from BMI or ASCAP. Being non-profit has its privileges.


Of course we can instruct them. We vote for all the board members and can remove them. However, it would require a lot of effort from the composer's point of view, and most people (me included up to now) are more content to moan, but not to do anything.

However, PRS is not the same as BMI or ASCAP in that for most composers it has all the music assigned to it by default. Therefore we have much more protection and can't be bullied in the way BMI and ASCAP members can.

D


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## NYC Composer (Aug 3, 2015)

Well, moaning is one of those human substitutes for action across the board . Still, you're luckier than we are in that bit of control.


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## Guy Rowland (Aug 3, 2015)

rgames said:


> I don't think it's grim - there is a solution. We just need to fight the fight that will make a difference.
> 
> Right now we're fighting the fight that Spotify wants us to fight because the outcome is clear to them (and their investors) and it won't affect their profitability.
> 
> We need to take ownership of the debate and move the focus away from royalties.



As ever, Richard, you're conflating about 50 things to reach the conclusion you always want to reach - "let's forget about royalties". When, time and again, the problems with your argument are pointed out to you, the debate trails off, doesn't it?

Out of interest, have you read David Byrne's article? Have you engaged with any of his points, rather than grafting your own on to them? There's this ludicrous fallacy that we somehow have the power to stand up and take ownership, do all our own deals and face the reality that royalties are dead - it's pure pie-in-the-sky nonsense.

The people who ARE engaged in this debate are the David Byrnes, U2s, BASCAs and so on. The issue is backroom deals and stitch ups, as they have eloquently said, where artists are at the end of a corrupt chain. The sums that Spotify et al pay out in total are perfectly fair - what isn't perfectly fair is the distribution, the maths which is opaque at best at the behest of the major music industry cartels. Further, there is now momentum in this case. Like Daryl said, if we can affect anything, its in voting for those who best represent the interests of the artists in our PROs, to add to this existing momentum.

So stop talking down royalties, a system that has taken many decades to build up and will never be rebuilt if dismantled, which is far from unique to composers, and which is still a primary source of a musician / songwriter / composer's income. Streaming should be - and is - a tremendous opportunity for artists, where good music and repeated plays can generate income many years down the line from each and every fan - IF the maths is fair. Instead let's support those who are genuinely engaged with this whole debate, who are doing their damndest to try to lift the lid on what is really going on.


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## Guy Rowland (Aug 3, 2015)

I don't know if this will save us any time (probably not) but I just did a forum search (with the new vastly improved search facility - yay). Here is what I wrote in response to Richard saying essentially the same thing about royalties in December last year - http://vi-control.net/community/thr...lties-specifically-hulu-netflix-amazon.42720/ :



Guy Rowland said:


> Ohhhhhhhhh yes. It's one of those perrenials. The last good one was here - http://www.vi-control.net/forum/viewtopic.php?t=39673
> 
> And in each of those threads, Richard pops up with alarming speed to encourage us all to get our heads out of the sand, stop thinking emotionally and accept that licensing is over. This despite no arguments that make sense, and repeatedly ignoring all contrary arguments and evidence.
> 
> ...



I kid you not, this is what Richard replied about half a dozen posts later, that same day:



rgames said:


> Here's the question I've never seen answered in any thread on the topic: if the up-front system is good enough for VFX guys and painters and architects and electricians and lawyers and engineers *and plumbers *and and and and, then why not composers?
> 
> There's an ENTIRE PLANET worth of examples of up-front payment systems that work perfectly fine for all involved. It absolutely can work for composers, too.



To which I replied



Guy Rowland said:


> Yay, I knew we'd get on to plumbers! Surprised it happened this quick though.
> 
> IP, Richard. That's the difference. Authors, Songwriters, Artists... you keep acting as if it's composers vs everyone else. Broadly it's artists who create original artistic work vs non-artists (and no, "artists" here does not denote not all workers who are creative). I throw that back at you - I and others have made this exact point many times, but you seem curiously unwilling to engage with it.



That thread died in mid-January, and Richard, as ever, did NOT reply.

At this point, isn't this simply trolling? Why is this ridiculous idea being raised yet again and taking over a thread that really doesn't have anything to do with it, when Richard seems to wiflully ignore any counter-arguments that I or anyone else (and there are a lot of us) raise? If we're going to discuss it again, fine, but Richard - please do respond to that 8 month old answer that you claim never exisits. Advance your argument, respond to what many of us have pointed out is ridiculous about it, and please don't keep hijacking interesting threads with your agenda otherwise.


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## NYC Composer (Aug 3, 2015)

I dn't think it's trolling, exactly- it's more like lecturing. Richard has a wealth of information to share with us and all of it is unassailably right- why bother arguing with the freshmen? He's TOLD us what's what.


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## KEnK (Aug 3, 2015)

Larry & Guy-

Ok you've had this discussion about royalties w/ Richard before.
But do you not find any credence to his "loss leader" argument?
Seems like that's a different angle to me and one worth at least thinking about.
Consider that Apple was entirely ready to give artists $0 during their alleged streaming trial period~
Until Swift did her thing, this was exactly the loss leader thing Richard is talking about-
Giving away other people's property w/o paying for it.

k


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## rgames (Aug 3, 2015)

NYC Composer said:


> the iTunes store will generate between 20% and 30% of Apple's revenue by 2020.


Yes. But music is a small and dwindling percentage of those revenues. There was an article on it in The Economist recently.








That's precisely why Apple bought Beats.

The app-makers are leading those revenues. And they're not fighting with anyone about paltry royalties. As a result, writing code is a much more profitable endeavor...!

rgames


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## rgames (Aug 3, 2015)

Here's the article:

http://www.economist.com/news/busin...ce-apple-trying-do-so-again-second-revolution

I'll quote the last line here:

"The fees it will pay them for streaming will be even more meagre than those they get from downloads."

rgames


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## Guy Rowland (Aug 3, 2015)

KEnK said:


> Ok you've had this discussion about royalties w/ Richard before.
> But do you not find any credence to his "loss leader" argument?
> Seems like that's a different angle to me and one worth at least thinking about.
> Consider that Apple was entirely ready to give artists $0 during their alleged streaming trial period~
> ...



...and well done Swift (though it's not nerely enough just to know they are paying some people something). I don't trust Apple one jot, and with the cash mountain that they're sitting on, it's especially morally indefensible not to properly compensate artists. Pressure does need to be brought to bear. The Apple u-turn wasn't quite what it seemed though. I don't believe it was all Taylor's doing - word on the street was that they were already under massive industry pressure. In other words - the same vested interests that Byrne describes were likely to be out of pocket by that promo, so Apple caved. Actually, that shows how powerful those vested interests are.

But this isn't all about Apple. Spotify's sole business is music streaming, so none of those arguments apply there. Last year it paid $1bn to "rights holders" - that's just one company. That compares with $9bn of total sales of physical and download media in 2008. Richard can talk down Apple all he likes (and - once again , you gotta admire the consistency of the man - he continues to ignore all the canyon-wide holes in his arguments), but that's not chump change. It all comes back to the same thing - we need to know the numbers.


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## sleepy hollow (Aug 4, 2015)

Daryl said:


> The big problem with a lot of Royalty based income is that although the collection agencies have huge power, they choose not to use it.


I'm wondering if this is a sign of change:
https://www.gema.de/de/aktuelles/prs_for_music_stim_and_gema_establish_the_worlds_first_integrated_licensing_and_processing_hub_to/

Probably not as "revolutionary" as they say, but it might be a first step.


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## chimuelo (Aug 4, 2015)

Guess I can now write a blockbuster hit after reading that.
Been saving my big guns for the right time.


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## Daryl (Aug 5, 2015)

The idea that Royalties are going away is frankly ridiculous. The only creative industries (for want of a better word) that I can think of that don't use a Royalty system are artists and sculptors. The problem is making sure that the actual creators get a fair share of something, whether by Royalties or by getting a decent fee.


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## Hannes_F (Aug 5, 2015)

rgames said:


> Everyone who discusses this topic should look up the meaning of "Loss Leader" to make sure they know what's going on.
> 
> A loss leader is something that you lose money in order to entice people to buy something else. The "something else" is profitable enough that it covers the loss that you take on the loss leader. That's what music is these days - a loss leader.



Thanks Richard, a very intelligent insight.


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## NYC Composer (Aug 5, 2015)

rgames said:


> Here's the article:
> 
> http://www.economist.com/news/busin...ce-apple-trying-do-so-again-second-revolution
> 
> ...



I did you the courtesy of reading the article, because I'm just that kind of guy.  

Since Apple refuses to break down numbers, you've based your thesis on the analysis done by one dude who runs a company called Asymco. I'm sure he's done what he can, but it's still a guess, much like the tea leaves and crystal ball readers who call themselves financial analysts. Me, I see it as one interesting but unverifiable guess.


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## Guy Rowland (Aug 9, 2015)

One more adding their voice:

http://www.independent.co.uk/news/m...ing-rewards-songwriters-receive-10447054.html


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