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Get Ready For a Streaming Music Die-Off
walterbyrd writes "Streaming services are ailing. Pandora, the giant of its class and the survivor at 13 years old, is waging an ugly war to pay artists and labels less in order to stay afloat. Spotify, in spite of 6 million paid users and 18 million subscribers who humor some ads in their stream, has yet to turn a profit. Rhapsody axed 15% of its workforce right as Apple's iTunes Radio hit the scene. On-demand competitor Rdio just opted for layoffs too, in order to move into a 'scalable business model.' Did no one wonder about that business-model bit in the beginning? Meanwhile, Turntable.fm, a comparatively tiny competitor with what should have been viral DNA, just pulled the plug on its virtual jam sessions this week—and it just might be the canary in the coal mine."
The record labels want online streaming to die. I've not followed the pricing too closely, but the cost per stream is something like 10x the price of a terrestrial radio station. That is why Pandora I believe was trying to purchase an FM station somewhere. The rates are lower if you have a terrestrial radio signal that then also streams IIRC.
"The problem with socialism is eventually you run out of other people's money" - Thatcher.
My business, (as with millions of businesses), exceeds the square footage that's allowed for legally playing a radio. As a result, I pay DMX/Pandora for the privilege. The service sucks. I either need to download an app or load Flash onto my computer to administer the account and the music choice. The rotation is repetitive. It takes between 20 and 45 minutes for the genre or channel to change. The remote control doesn't work properly. The stream inexplicably stops often. Customer service is abysmal. iTunes Radio can't be used in commercial settings. Same with Spotify. And Rhapsody. When one's business practices consist of poor user experience, poor customer support, and poor product delivery one's business deserves to die. This isn't a result of a shit market, it's the result of shit products.
It is just a matter of finding correct monetization strategy.
Just look at the pie charts - Pandora already has the system in place for music discovery, which is the coordination problem that the corporate model provided one solution for. Once bands don't need corporate music middlemen, they can get half of the revenue, or more.
I've heard a bunch of great stuff on Pandora that I'd never heard _of_ before. Apparently there were a bunch of rock bands in the early 70's that achieved very little commercial success but recorded lots of fantastic music. I assume they each got a little piece of each of the thousand times Pandora played me the same blasted ad for an Intel ultrabook (which are overpriced).
Getting new bands into the new system is the challenge. Their odds are low with the A&R man, so going into something like Pandora makes a bunch of sense. Pandora even has the filtering technology in place to detect the turkeys.
Of course a random op-ed on RWW carries more credence than an entire industry, right?
My God, it's Full of Source!
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