The State of Digital Music: The Rdio Conversations

The Following was pasted 11/20/2011

Jason Paul
@Lacey I do plan to reinvigorate my own music distribution. I’ll then yank my stuff off of CDBaby and use something like AWAL which takes 15% a stream/sale but there is no upfront cost. I’ve been on hiatus for 4 years somehow 😉

I am not sure if you’re kidding about the ‘money-making’ opportunity though. It sounds suspicially like Red Foxx. I think there’s some red-tape in that plan none of us know about that would prevent it from working as planned (or they might just red flag it).

Call me a purist but I don’t think the streaming system should be gamed…although as I wrote in my blog post this is probably exactly what the big labels are doing/will be doing to make sure their product stays at the top in a streaming music world.

So all that said…while I might not want to participate in your idea for ethics reasons, I really do want to see if it will work. So maybe I can justify it on a purely experimental/investigative basis 😀
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13 minutes ago

Lacey Underall
Jason Paul, you need to leverage your earnings! CD Baby takes what– 1.00 off every sale? So if you have seven bucks you can buy your own CD seven times. Jack up those sales figures! It’ll at least make you look cool. 🙂

Speaking of which, does anyone want to take me up on my awesome money-making offertunity? It works like this:

1) Record an album of 12 tracks, each 1 second long.

2) Use CDBaby, Tunecore or zabbadabbawhatever to get the song on Spotify, Rdio, and other streaming services. Make sure to get the “songwriting” credits and all that along with the artist credit for bonus payout

3) Join all the subscription services.

4) Stream the “album” or make a playlist. And just stream it on loop 24/7.

There is something like 2.6 million seconds in a month, so that’s 2.6 million plays on each service. Assuming a royalty rate of .001 a song, that’ $2600 per subscription service. Plus possibly songwriting royalties.

There is a one-time investment cost of I dunno, maybe $100-200 to get the songs listed on the services. After that, a subscription to the four services will cost you $50 a month, for a monthly return of over $10k a month. And this is assuming there is a minimum of 1 second song length. If we can get some .01 second songs up there, suddenly that’s $100k a month.

It can’t fail!!!!
55 minutes ago

GrETcHEn
@Noah, originally, when the catalogs were less complete, because if I couldn’t find an album/track in one place I’d pop over to the other. They’re all cheap — I mean $5/mo x 3-4 sites is pretty workable for me, compared to the $$s I used to spend on buying music (and, I cancelled my cable because I don’t watch tv anymore — I stream or rent instead — so I’ve moved over to that model for more than music). I also kinda keep tabs on their features and UIs to see what’s coming down the pike. Most of them allow you to keep your account while cancelling the service, and even still use part of the site. So you’ve reminded me it’s probably time to mothball a couple of them…
3 hours ago

Jason Paul
interesting…for the record I haven’t sold a cd on CD Baby since 2008. I’m up to $7.42 in 100% digital streams for the year. nice. It would be interesting to see the balance sheet of an independent artist whose actually promoting their albums.
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22 hours ago

Jason Paul
Hey Tod,
This is the album I put out in 2007: http://open.spotify.com/album/3SRL3LylODNhYJ9XWc7HBW

(i didn’t intend to put it out on Spotify as I didn’t know what it was, but CD Baby has distro with them).

I would love the album to be on Rdio but CD Baby doesn’t have a deal with them. I’m working on something right now and hope to re-distro everything through these guys which do allow artists without a label to get distribution on Rdio and many others: http://awal.com/
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23 hours ago

tod nelson
That’s danged cool, Jason. I’m on Spotify occasionally–do you mind posting your album info so I can check it out? Have you thought about making it available on Rdio?
23 hours ago

Jason Paul
As a music maker, I’ve put out 2 albums (different bands). One is still floating around on Spotify. I was a bit surprised at my CD Baby statement last year when nearly all the money (about $30) was from Spotify streams last year. Keep in mind I released the album and forgot about it…so $30 bucks on zero promotion. As a song writer (with no intention of supporting myself with music) the opportunity I see with streaming music is exposure. I don’t care that people buy it. I just want people to hear it. And the more people using streaming music services the better opportunity I feel that my music has to be heard (because 9.99/album is just an unreasonable amount to pay for an unknown band). I’m probably not a typical musician as I’ve kind of lost the dream of being a super mega rockstar. But for me this is art…and I want everyone to appreciate it without the usual financial barriers…So even with lower up-front payouts I think Rdio, Spotify, MOG are the nothing but good things for (lesser-known) artists.
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24 hours ago

tod nelson
And here’s an article that says for every .99 download on iTunes, a UMG-signed artist gets 8 cents. I guess Chuck D is pissed off!

http://www.digitalmusicnews.com/permalink/2011/111103labelpays
24 hours ago

tod nelson
This is the most detailed analysis of streaming payouts I’ve found to date:

http://ht.ly/7yR1I

The most revealing thing is that perhaps Spotify bases its payouts based on revenue–as revenue goes up, payouts go up–they’ve risen 100% in the last few months.
24 hours ago

CY *
@Noah Cheng~~ Re: ….why some of you pay 3 music streaming services.

Just call me NUTS!!! I’ve asked myself the same question, you find pieces of each that are hard to let go of. The reason I stay in Rdio, probably because many of us from those ‘Lala’ days are here, comfort zone I suppose. MOG, they seem to have the music catalog that suits my taste. (smile) Spotify, well that was a new add, one I wanted to test the waters on…and not sure which to drop now. YES, I’m a little crazy and on the side of ‘excess’, seeing as I also land in places that I can hear music for ‘free’, such as ‘soundcloud’, ‘bandcamp’ and I use my exfm ext. from google. I’m addicted to NEW finds and to music!!

There will come a day to drop one or more, that will happen.
1 day ago

Noah Cheng
Spotify track-centric search result definitely is a major turn off to me though I doubt it matters to most people. As someone has already pointed out, it all comes down to the advertising and the marketing. I’m also curious the reason why some of you pay 3 music streaming services.
1 day ago

David Crompton
I’ve often wish I knew the exact Rdio formula so I would know how much my plays were paying out.
@fangoguagua That’s an interesting point–I’ve gone on the assumption that it’s complete plays so I’m careful not to stop or skip a track before it completes with this in mind [If I’ve listened!]
1 day ago

fangoguagua
The Keith Jarrett question is interesting. It seems like time should be more important than tracks. I have wondered exactly when/how I am charged/credited with “listening” to a song. Is it the first click? 30 seconds? Does that affect royalties? Do they only get paid for full listens?
CY – I am with you on LaLa. And for my money no combination of models even comes close so far.
1 day ago

maudeman
The numbers I saw were specifically related to Spotify, and specified .03 cents per song, or .29 cents per album. Each country has different licensing, although the EU may be one entity, rather than country by country.

RE Rolling Stone. Matt Taibbi is no Hunter Thompson, but he does have a way with words. In general, (and despite the occasional good interview/article) RS and Jann Wenner are as relevant to the culture as Entertainment Weekly or US Weekly. RS is a vehicle for auto makers and beverage purveyors to imply they are “hip”. RS used to be a great periodical; it is now a great place now for keeping up with Katy Perry and George Clooney and Eddie Murphy.
1 day ago

GrETcHEn
Yes BC, take a look for yourself:
http://www.rdio.com/#/artist/Cathode/album/The_World_and_Back_-_EP/

I picked an album with infrequent listens so I could watch the results.
2 days ago

skydivingrhino (rob)
BC, synched listens are time-stamped so, depending on when you listened and how popular the album is, you may show up way down recent listeners or not at all; but the listens are counted
2 days ago

Biker Chick
@Gretchen – did it show your avie in the just listened box? just curious.
2 days ago

CY *
Interesting thread, I still think ‘Lala’s’ model was brilliant. But the power players win.

http://www.scoop.it/t/the-shape-of-music-to-come

Sharing a link on all things ‘music’ …I mean everything. Pretty much everything that’s come out in this thread, plus more. The concept of ‘music’ in the data cloud or any form of the digital market via internet is still pretty much in the infantile stage, maybe ‘tween’ stage. Takes time and I’ve always felt the main player, being the artist needs support, via direct order. That is possible, due to the internet, they can skip the middle men. All of these ideas have been hashed out here multiple times. Heck, I just don’t like the idea of not being able to purchase a record or cd!!! Can you imagine reading books ONLY via digital!!! I like to touch!! 🙂

No time to research as much as all of you…just wanted to say, thank you for sharing the data (which is always a question of accuracy)….enough from me.

Share ON, Rdio neighbors. By the way, I still say…it’s taken ‘Rdio, Mog and Spotify’ to replace ONE favorite “Lala”… 🙁
2 days ago

GrETcHEn
No Tod, there’s really not enough difference in what the two provide or how they work. To talk about catalog or stream quality or social…that’s just splitting hairs when it comes down to it. It’s all about marketing, and Spotify has won big time.
2 days ago

tod nelson
@Gretchen–I thought it was interesting that one person thought it might be Spotify being track-centric as opposed to Rdio being album-centric. Also, I thought the disparity between collections was debunked a while back. Though Rdio launched with 7 million tracks, with a few exception they have about as many songs as most of the other streamers. (No one has Drag City!) I’ll have to look again to confirm, but I thought it was 13 mill to 15 mill.

And thanks for testing out the mobile play issue! I was wondering how that worked.
2 days ago

GrETcHEn
@BC, I just tested listening to a sync’d album on my mobile. As soon as I started listening, the count increased by 1. So, sync’d listens absolutely count. Maybe you’re not seeing the increase until you reconnect the mobile? Obviously if it’s offline, it can’t update the count.
2 days ago

GrETcHEn
@Tod, I thought the answer was obvious: Facebook has driven users to Spotify in droves.
2 days ago

GrETcHEn
I haven’t read the statements from bands pulling out of streaming, but it immediately raises the question in my mind: how are you planning to connect with an audience, and therefore, make money? Are they sticking with iTunes?
2 days ago

tod nelson
An interesting question and thread on quora.com:

http://www.quora.com/Why-does-Spotify-receive-so-much-more-attention-in-Silicon…
2 days ago

tod nelson
@maude–I agree that we don’t really know. I was just running the numbers based on the article. Where did you get the .0003 number? From the info-beatiful graphic from April ’10 based on Spotify’s UK operations? I totally agree with you on the notion that the tech. drives the music.

It’s too bad you don’t consider Rolling Stone a trusted source. Some of the best (and most ethical) writers I know work or have worked for RS (I’ve worked for a couple, with a few, and have had a number of them work for me–I’d stack their work up to anyone’s work). They have have to uphold the same journalistic standards you’d expect at any publication. Have you read Matt Taibbi’s political writing? It’s as good as it gets–actually, better.

http://www.rollingstone.com/politics/blogs/taibblog

That said, RS is not my favorite go-to resource for music writing. For that I prefer Mojo Magazine, a true music geek rag!
2 days ago

Lacey Underall
The royalty rates even for a straight up album sale are amazing complex. Different amounts to have to recoup, buyouts from going to one label to the other, songwriting credits, points given and points deducted for made up things, etc.

One thing they all have in common and you don’t have to be an accountant or lawyer to see it: the artists are getting screwed. Only a very, very small handful of either megapopular or very, very smart musicians can actually make even a modest living at this. Everyone else just gets a free six month cross country trip on a bus.

I thought that quote in RS where the guy was saying that his band doesn’t think about any of that royalty stuff, they just want to get out and play their shows totally captures the mindset. Musicians say a lot of cheesy things about music they don’t really mean, but not that one. They really do play for the love of the show.
2 days ago

maudeman
I glanced at the Rolling Stone article, Tod. They are not a trusted source for me, and haven’t been for decades. They sleep with advertisers (and big record companies) and not with their readers. I also have a degree in accounting, and none of the numbers quoted – “one band’s manager said” added much clarity to what is -since big record companies are involved – unnecessarily and deliberately obscured revenue reporting. Also, the numbers for all the services were added together, as if they all had the same agreements (which would violate antitrust provisions) and doesn’t make sense in a world where Spotify has 2.4 million daily users and Rdio has 4,000.
I’m not arguing that you are wrong and i am right, I’m just saying that the situation is complicated, most “facts” are just theories or assumptions, and unless you or I become major stockholders in one of the streaming services, or acquire one of the three major record companies left, we aren’t really gonna know.
Technology drives the music, and always has. Bands should stream their music, not because they will make more money there today, but because that is where the technology is taking the music, and music needs to be heard before it can be enjoyed, or generate money.
2 days ago

3 thoughts on “The State of Digital Music: The Rdio Conversations”

  1. Great post and comments!

    Right. So… Is Rdio the Future of Music?

    The problem with these sorts of “x is the future of y” discussions, particularly where technology is concerned, is that x always changes the nature of y. Because of this, you can never quite arrive at point y.

    I see Rdio and it’s ilk bumping into a few issues shortly that run along these lines:

    1) The closer these services get to delivering on the promise of offering “almost everything” in the world of music, the more they will underscore what isn’t offered. Put another way, how much music needs to be available to make up for the fact that what you want to hear right now isn’t?

    2) Part of the appeal of these services lies in the social aspect, which presently is built on the enthusiasm of early adopters and music nerds. The tone and quality of the social interaction will change as more users sign on. Will Rdio still be compelling?

    3) Rdio is presently a novel way of trying to monetize music in a time where monetizing music is difficult. It’s an experiment that is occurring concurrently with other experiments at trying to resuscitate the monetization of music. A verdict will be reached. Recent high profile releases by Coldplay, Black Keys, Tom Waits — to name a few — are not present on Rdio. Presumably this is because posting on streaming services is viewed as possibly undermining the success of other channels, both experimental and traditional. Is this the start of a verdict being reached? Will this assessment be shared by others?

    Just a few thoughts.

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