Music Industry Is Keeping Streaming Services Unprofitable

Lucas123 writes "Music streaming services, forced to give from 60% to 70% of their revenue to the record industry, will never be profitable in their current state, a new report shows. Unless the services can monetize their user base by entering new product and service categories, or they can sell themselves to a larger company that can sustain them, they're doomed to fail. One method that subscription services might be able to use to achieve profitability is to up sell mobile deals or bundles to subscribers. For example, a select package of mobile services would be sold through the music service provider, the report from Generator Research suggested. 'Services like iTunes Match and Google and Amazon are already heading in this direction,' the report states. Another possibility would be for a larger company to purchase the music service or for the service to begin offering sanitized user behavioral data to advertisers, who could then better target a customer base."

Comments

Bypass the Middle Man

[organgtool]

How about a system that lets the artists themselves opt in (bypassing ASSCAP) for a reasonable set of royalties. The artists would get more money than the record companies give them for their streamed music, the streaming companies would pay less in royalties, and the tyRIAAnosaurus rex can take another step towards its destiny.