Taylor Swift Is Not The Savior Artists Need

from the the-feel-good-story-that-isn't dept

I’m going to do something crazy and generally not advised on the internet: I’m going to try to make a nuanced argument that cannot be summarized just in the title alone. I fully expect that some will not read through the details, but please, just ignore them in the comments and try to focus on the full argument presented here.

Let me start out this post by noting a key thing: from the beginning, it was stupid that Apple had negotiated a deal with record labels in which copyright holders would not be compensated with royalties for the three-month “trial period” of Apple’s new streaming music program. It clearly should have agreed to pay the royalties, and it was a really short-sighted move to push for a deal without royalties. It was always going to come back to haunt the company. Second, while I know some people like to attack Swift for a variety of reasons, I actually think she’s an incredibly savvy music person, who has built a tremendously successful career, often by maintaining control on her own and not giving it up to the major labels. That’s fantastic. But all of that doesn’t mean I think what happened this weekend was a good thing (remember: nuanced argument, please read on).

Of course, as you’ve probably heard, on Sunday, pop star Taylor Swift wrote an “open letter” to Apple on her Tumblr blog about how ridiculous this was, and how she wouldn’t allow her latest album to stream on the service because of this — even though she supports Apple’s “no free tier” stance. There’s a lot to comment on about her piece but, no matter what, it was effective. Late on Sunday, Apple’s Eddy Cue tweeted Apple’s capitulation:

And… the internet went kind of wild. The fact that Taylor Swift wrote a blog post that made Apple — probably the richest and most powerful company in the world — back down within a day (on a weekend, no less), does have a sort of populist appeal to it. People started jokingly suggesting that Swift should weigh in on politics, the Middle East and much, much more.

Thought pieces were written by-the-dozen about how Swift is the “most powerful woman/person in music/tech.” No, really:

And that’s just the first ones I found in a quick Google search. There are more.

But here’s the problem with all of this: it’s hogwash, meaningless blather that doesn’t change a thing and will have no lasting impact. If anything, the lasting impact may be negative, not positive for artists. And, remember, I actually agree with the overall point that Apple’s original decision was the wrong one, and think the company made the right decision to reverse course.

But there are three big problems with the rush to celebrate Swift as the new savior of the music industry over this. First her arguments for why are misleading and not very helpful. Second the overall impact of this move will be minimal to musicians (and other creative types). Third, it will give a false sense of hope to those who rely on obsolete business models, rather than innovating.

Let’s break down all three. First: her arguments are kind of useless. Here’s the key one, which got lots of people excited:

This is not about me. Thankfully I am on my fifth album and can support myself, my band, crew, and entire management team by playing live shows. This is about the new artist or band that has just released their first single and will not be paid for its success. This is about the young songwriter who just got his or her first cut and thought that the royalties from that would get them out of debt. This is about the producer who works tirelessly to innovate and create, just like the innovators and creators at Apple are pioneering in their field?but will not get paid for a quarter of a year?s worth of plays on his or her songs.

It’s very touching. And it’s almost entirely hogwash for a variety of reasons. First, if your album is a success, there are all sorts of ways to make money beyond the royalties from Apple Music’s streaming service. Swift herself kind of admits this in her first sentence in which she notes that she makes a ton of money playing live shows. And why does she make that much money live? Well, as Tom Conrad rightly points out, her career was built on terrestrial radio play — which is a free service (the kind that Swift has attacked Spotify over) and which doesn’t pay the performers anything at all in the US. You can (and many do!) argue that the law in the US should change on this, but it’s the way things are today, and Swift is living proof that being a part of a free service that doesn’t pay performance royalties certainly doesn’t mean that you end up suffering. In fact, it can lead to an immensely successful and profitable career… like Swift’s.

But that brings us to the second problem with that paragraph, which is that for most musicians, this doesn’t much matter anyway. That’s because the industry’s biggest secret, which it always tries to hide from these debates, is that the vast majority of musicians basically make absolutely nothing in royalties. This is due to a combination of factors, starting with the fact that if you’re signed to a label, the label is likely keeping nearly everything you get from streaming. When Eddy Cue says “Apple will always make sure that artist [sic] are paid” he’s lying. They may make sure the copyright holder gets paid, but that’s frequently not the artist.

And, related to this, is the other dirty secret: most musicians don’t have a big enough fanbase to generate enough revenue. Most musicians don’t make a living, period. That has always been the case. The supporters of the old system like to try to slide this fact under the rug and they do some creative counting, where they only look at the stats of those who have made careers out of music, and they leave out the vast majority who fail. The vast, vast, vast majority of musicians don’t make a living, because the music business is tough. It’s tough to get attention. It’s tough to make good music. It’s tough to make money. Apple paying for streaming really only addresses a tiny, tiny, tiny bit of that last one. No musician is going to make it or not based on getting paid in this three-month trial. If they’re getting enough plays to matter, then they have other ways to make revenue.

Three months is a long time to go unpaid, and it is unfair to ask anyone to work for nothing. I say this with love, reverence, and admiration for everything else Apple has done. I hope that soon I can join them in the progression towards a streaming model that seems fair to those who create this music. I think this could be the platform that gets it right.

Three months is a long time to go unpaid. But not getting paid by Apple Music does not mean “going unpaid.” It just means one small revenue stream is limited while it aims to get up to speed. And, again, Swift herself proves this via the fact that her songs play all the time on the radio ? for free, but still helping her get paid. And, even though she can pull it down, she’s left her streaming music on YouTube. Furthermore, as others pointed out, Swift herself is a bit of a hypocrite here. She puts ridiculous limits on photographers who are on assignment to photograph her shows, such that it often means they have to put in the work and not get paid — even as she gets to use their photographs forever. If she’s really so concerned about creative types “going unpaid,” shouldn’t she be paying those photographers for their works?

As for the second point above: the overall impact of this move will be minimal to musicians (and other creative types). As already discussed in point one, for most musicians, this isn’t going to move the needle one way or the other. Any musician out there relying on the royalties from Apple Music to make or break their musical career has no musical career. Perhaps it’s possible that there are one or two artists at the margin for whom this is helpful, but for the vast majority of artists, this isn’t going to make a big difference at all. Additionally, while Apple has said that it will now pay during the trial period, it didn’t actually say how much it will pay. Yes, for struggling artists any revenue helps, but trust me, when the first royalty checks from Apple start coming in, I can guarantee there will be musicians complaining online about how little they get. Those stories always get coverage. They’ll happen again.

And, of course, for label-affiliated artists, much of it will go to the label anyway, and the artist won’t see any of it.

Finally, onto the third, and most concerning point: it will give a false sense of hope to those who rely on obsolete business models, rather than innovating. We’re already seeing this in the reverence and adoration being showered on Swift for her blog post, despite its questionable premises — but more for its impact. And musicians are celebrating this, despite the fact it won’t move the needle for them one way or the other. And that’s really unfortunate, because here’s another chance to do things right by focusing on business models that let them connect directly to fans and give them a reason to buy something. Demanding others pay you money is no substitute for convincing others to willingly pay. One is sustainable, one is not.

But because of this “success,” people will still cling to the false notion that the “solution” to content creators’ failure to build their own successful business model is to demand that other successful companies give them money. And this goes way beyond music as well. Already, you see people like Jeremy Olshan, Marketwatch’s Editor-in-Chief, saying that “journalism needs a Taylor Swift to save content from getting… devalued.”

This is wrong on so many levels, but that’s another post for another day. But this notion of “a savior” magically swooping in and reviving business models that aren’t working any more, based on sheer will, is a myth. And it’s a dangerous myth because it gets people focusing on that rather than implementing sustainable business models and creating great content. There is no savior for music. There is no savior for journalism. There is no savior for movies. No talk about “fairness” or “fair compensation” or “ethical compensation” is going to change fundamental economics. Most content creators fail out of making a career of it, and if you’re going to succeed, praying for a savior, rather than taking steps to ensure a competent business model, isn’t likely to be particularly productive.

To conclude (with nuance baked in): So, again, despite all of this, I think Apple made the wrong move initially, and the right move on Sunday night. However, Taylor Swift’s reasoning was silly (even if I think she’s a great success story who has built up a tremendous career without ceding much control), and the impact of all this will be basically nil for almost every single artist. But, worst of all, this whole episode reinforces this savior concept, and the false belief that because some companies are successful, while some content creators are not, a savior should just demand “fair compensation” and money will magically rain down upon the creative class. It doesn’t work that way. It’s never worked that way. And nothing in what happened over the weekend with Swift will change that. If anything, it only serves to distract people from focusing on the business models that do work.

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Comments on “Taylor Swift Is Not The Savior Artists Need”

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92 Comments
Violynne (profile) says:

I think this article points out what so damn wrong with “journalism” today.

The fact Swift doesn’t realize she’s one of the reasons people would be drawn to a service her music is on is a bit nefarious. There’s no damn way the little artists are going to benefit from any streaming service.

If the little fish didn’t have to rely on the bigger fish, perhaps there would be plenty to celebrate, but reality sucks.

Secondly, Swift receives zero royalties from any streaming service. This should be obvious, but it’s not. Her label will get the royalties, and the label is who will cut her a check.

Note the situation change now. Twice now, Taylor has attacked the wrong source of revenue. If anything, she should be calling out her label for allowing this, not Apple. Apple has nothing to do with this other than having to pay up front costs to license the music.

But the real kicker is how she’s bitching about Apple when her own damn contracts do the same to everyone else who deals with her as an artist.

Photographers must give up all copyright control if Taylor is in the picture. Refuse? She has the right to destroy expensive equipment.

The sheer audacity she has to claim unfair treatment by Apple is just another example of entitlement by artists who are popular enough to make demands, forcing everyone to cower because their revenue will be affected.

Taylor Swift is the female version of Lars Ulrich.

It's a vice to comment here... says:

"focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

You blather on jealous of Taylor Swift but YOU HAVE NO OTHER BUSINESS MODEL. I’ve asked you probably a hundred times by now over the last six or so of your SEVENTEEN years of blathering.

I’ve pointed out many times that GETTING NOTICED IS THE TOUGHEST PART. You have NO advice on how to do that.

You like Spotify for unknown reason, supported it paying artists less. You ignored the BIG story that Spotify isn’t yet profitable even with 60 million listeners, a quarter of them PAYING, rest getting ads.

You (all) can’t seem to distinguish between the evil ??AAs and artists: YOU DON’T CALL FOR TARGETING CORPORATIONS, just insist that piracy (neither corporations nor artists getting money) is good for artists!

You definitely don’t support Populism. Not when getting funded by Google and other corporations in your so-called “think tank”.

This is just another of your characteristic attempts after facts can’t be denied to claim: “I was right all along!” Also characteristically LATE: you dodged taking any position on it while was going!


Oh, and the call to ignore dissenting comments! What a hoot! You can’t answer them, so just ignore!

It's a vice to comment here... says:

"focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

You blather on jealous of Taylor Swift but YOU HAVE NO OTHER BUSINESS MODEL. I’ve asked you probably a hundred times by now over the last six or so of your SEVENTEEN years of blathering.

I’ve pointed out many times that GETTING NOTICED IS THE TOUGHEST PART. You have NO advice on how to do that.

You like Spotify for unknown reason, supported it paying artists less. You ignored the BIG story that Spotify isn’t yet profitable even with 60 million listeners, a quarter of them PAYING, rest getting ads.

You (all) can’t seem to distinguish between the evil ??AAs and artists: YOU DON’T CALL FOR TARGETING CORPORATIONS, just insist that piracy (neither corporations nor artists getting money) is good for artists!

You definitely don’t support Populism. Not when getting funded by Google and other corporations in your so-called “think tank”.

This is just another of your characteristic attempts after facts can’t be denied to claim: “I was right all along!” Also characteristically LATE: you dodged taking any position on it while was going!


Oh, and the call to ignore dissenting comments! What a hoot! You can’t answer them, so just ignore!

Anonymous Coward says:

Re: "focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

You blather on jealous of Taylor Swift but YOU HAVE NO OTHER BUSINESS MODEL.

In case it isn’t clear – YOUR failing business is YOUR fucking problem.

I’ve pointed out many times that GETTING NOTICED IS THE TOUGHEST PART. You have NO advice on how to do that.

YOUR not getting noticed is YOUR fucking problem.

You ignored the BIG story that Spotify isn’t yet profitable even with 60 million listeners, a quarter of them PAYING, rest getting ads.

This one is SPOTIFY’S (and their shareholder’s) fucking problem, not mine.

In short, I’m sorry the music business is tough. But if you want me to help you fix it, then YOU can start by fucking paying ME for the help.
Surely this is something you can understand.

Gwiz (profile) says:

Re: "focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

Oh, and the call to ignore dissenting comments! What a hoot! You can’t answer them, so just ignore!

It wasn’t a call to ignore dissenting comments – it was a call to ignore uninformed, ignorant commenters who didn’t read and comprehend the whole article – like you.

But, I do understand your outrage about ignoring dissenting comments – that’s your patented modus operandi to a tee.

Anonymous Coward says:

Re: "focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

From her own words:-

Thankfully I am on my fifth album and can support myself, my band, crew, and entire management team by playing live shows.

Its is actually an old model, and live shows are the means by which most successful musicians make their money, recording on the other hand is how the labels make .

JP Jones (profile) says:

Re: "focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

You blather on jealous of Taylor Swift but YOU HAVE NO OTHER BUSINESS MODEL.

You mean like the business model where all the content here is free and can be freely replicated elsewhere? Yeah, that clearly doesn’t work…

I’ve pointed out many times that GETTING NOTICED IS THE TOUGHEST PART. You have NO advice on how to do that.

You mean like releasing your content for free, which naturally increases exposure, thus leading to more fans, and eventually more money? This is pretty much this site’s entire argument…selling things that are limited and not relying on copyright to make an unlimited good into an artificially scarce one because it’s counter-productive. The purpose behind this argument is to help with getting noticed, which, as you said, is the toughest part.

No advice? That’s literally this site’s main point. Try reading this, this, and this, all of which discuss core concepts of Techdirt as it relates to business models. Considering these articles are part of the “New to Techdirt?” list at the bottom of the site I’m not sure how you could argue Mike doesn’t present advice.

YOU DON’T CALL FOR TARGETING CORPORATIONS, just insist that piracy (neither corporations nor artists getting money) is good for artists!

[Citation needed]. That being said, and this is my opinion, piracy can be good for artists! You said it yourself, in fact, in the second part I quoted…getting noticed is the toughest part. If that is true, then “piracy” increases exposure. This is pretty much what advertising is, by definition.

Someone who doesn’t know about your content, or doesn’t know if they will like it, is unlikely to ever buy any of it. People generally don’t spend money randomly (maybe frivolously, but generally they know or think they know what they’re buying). A pirate doesn’t pay, sure, but neither does the ignorant potential customer.

The difference is that pirate has been exposed to the content…the potential customer hasn’t. We spend so much on advertising because it works, and the pirate is much more likely to buy the content in the future than the unexposed individual.

I know I’m wasting my time because you’ve already decided that copyright infringement is theft. You most likely believe that piracy is a lost sale, and that if the pirate weren’t able to get something for free, they would have bought it instead. There’s little evidence for this, and even in cases where it is true, it generally only applies to content that is already popular. Which doesn’t help the people in your second paragraph.

Anti-piracy fanatics love to point out piracy rates and the couple of instances where loss of big piracy sites (usually temporarily) slightly increased sales rates for legal retailers. They like to ignore the strong correlation from multiple studies where the individuals who pirate the most content also tend to be the biggest spenders on content, because that doesn’t fit their “Piracy is theft…you wouldn’t steal a car!” narrative.

Now, what Mike has actually argued, and I agree with, is the piracy is generally a service issue, not a social one. Piracy rates tend to decrease in areas where legal alternatives approach the quality and convenience of pirate sites at a reasonable price. The actual number of sites that do this are very few (and I would argue all are strictly inferior to pirate sites, both in breadth of content and actual value in the product received, regardless of price).

He has stated, and I agree, that offering legal alternatives that do not fetter customers with frustrating restrictions or ridiculous pricing will reduce piracy rates to a few die-hards who refuse to pay for anything (and will never be customers regardless). Keep in mind that buying power per customer is not linear; I “pirated” a lot of anime during my college years because A) most of it wasn’t available in the U.S. and B) I didn’t have any money. It didn’t really matter if it was cheap; I couldn’t afford to spend cash on anime.

I did, however, become a huge fan during those years, and now I’ve bought a lot of anime. It’s more convenient to buy and lets me maintain a nice collection. I promptly rip all of it off those useless pieces of plastic they ship it in for actual use (the DVDs never actually leave my shelf once ripped) but I’ve spent literally thousands of dollars on anime. If I hadn’t been introduced and developed a liking for it during college, however, there’s no way I’d have had the time to discover it now, and all that money would never have been spent.

The world is only black-and-white if you are a child, fanatic, or idiot. Which are you?

JMT says:

Re: "focusing on the business models that do work" -- OKAY, SO WHAT ARE THOSE, COLLEGE BOY?

“You like Spotify for unknown reason, supported it paying artists less.”

No, the argument was that Spotify should pay rightsholders the same as everyone else, not more. Are you terribly forgetful or just lying?

“You ignored the BIG story that Spotify isn’t yet profitable…”

This has been mentioned many, many times. Again, forgetful or lying?

Anonymous Coward says:

First, I disagree with the 3 month deal. Apple has every right to negotiate the best contract it can with every company including Swift’s. That she disagrees with the free intro is to her benefit, but that doesn’t equate to another label or artist and their contract. After all, if Sony gets a most favored nation clause with Apple like they did with Spotify, it may be more beneficial than that 3 month leeway. What the artists actually receive of course has nothing to do with the contract usually, as you stated.

Anonymous Coward says:

Re: Re:

Apple has every right and the record companies have every right. That is the thing about negotiations: The most nasty and despicable scum often takes the brotherpart, while shrouding it in a veil of secrecy.

I would argue for at least some balance in negotiations. Not because it is “right”, but to avoid too one-sided first deals since they make the standard for future deals. Same would go for lawmaking and jurisprudence.

Anonymous Coward says:

Re: Re: Re:

You people like to ignore the BILLIONS of dollars Apple grosses from downloads on their iTunes store. You like to pretend that recorded music isn’t a very desired commodity. That musicians don’t make money from it. That thinking is unquestionably delusional. I have true pity for you.

Anonymous Coward says:

Re: Re: Re:5 Re:

That’s cool, and I think it’s enough for me to get the main points.

– Your group is independent, so it sounds like the money doesn’t have to shared with middle men/intermediaries?

– There’s online media presence in multiple areas, where I’m guessing some samples/sharing of the music is involved (IIRC that’s one of the strengths of Bandcamp?). In either case along with real world promoting, It sounds like the band isn’t afraid to hustle.

So while I don’t disagree that the Techdirt crowd often has a “drunk crowd on open-mike night” vibe to it, one thing seems clear to me:

By being willing to promote the group directly with your fans, your group has found a way to convince them that buying the music is worthwhile. Combine that with independence, it sounds like a living, even if it’s a tough one.

Anonymous Coward says:

Re: Re: Re:6 Re:

I really don’t understand why the “artists” who post on Techdirt to rant simultaneously treat the readerbase as filthy, insignificant pirates who can’t do anything to change the status quo…

Yet when citations are requested, such as the names of the bands they’re actually in, they’ll hem and haw and outright refuse, claiming that we’ll make a huge monetary dent in their earnings despite the insignificance they allege.

JMT says:

Re: Re: Re: Re:

“You people like to ignore the BILLIONS of dollars Apple grosses from downloads on their iTunes store.”

I don’t think anyone’s ignoring that, and I’m not sure what your point is. Do you actually know how many billions, or are you speaking hyperbolically?

“You like to pretend that recorded music isn’t a very desired commodity.”

That’s a complete fabrication on your part. Nobody here has ever denied music’s desirability, so again, what’s your point?

“That musicians don’t make money from it.”

Another fabrication. Nearly all musicians on record labels make nothing from royalties; this is not a disputable point. But there are other ways to make money from music, and they’ve been discussed here many times.

Jeremy says:

Taylor Swift is right. Plain and simple

Anyone complaining about Taylor Swift and her take on streaming seem to forget one important thing:

Taylor Swift is The Best Selling Artist of recent years.

This means she could have similar deal U2 made with Apple at the drop of a hat.

And in that case she wouldn’t have to worry about record sales at all, she’d get paid nicely at one go, no matter what her record sales or streaming amounts were.

Now, That my friends would be true pure greed and yes, she could do it anytime, And, she would be earning more money doing so than she is now through her record sales.

How much did U2 get for the Apple iPhone “free album” release? 90 million? 100 million dollars?

Taylor Swift could have a similar deal anytime, in other words she could say “screw you guys, I don’t care” and sit in her mansion with a big smile on her face.

John85851 (profile) says:

Yet again, I wish the media would calm down

Is Taylor Swift the most powerful woman in the tech industry? No, especially when there’s always a reason why a company like Apple decides to negotiate. But it’s a good story and most media outlets are falling over each other for the best click-baity headline.

No, the real problem is that the media is playing up how this is a “win” for artists.
One local news station said this problem is best exemplified by how Spotify played Pharrell’s “Happy” around 43 million times in one month, yet his royalty payment was only $2,700.
Um, isn’t there a HUGE step missing? Like, how much did Spotify pay his label and why the label only sent him $2,700?

Nope, it’s an easier story to tell when it’s a female, teenybopper singer versus a multi-billion, multi-national corporation.

jilocasin (profile) says:

Taylor Swift, nice but inconsiquential argument

It nice to see someone attempt a nuanced argument these days.

There’s just so much wrong, or more importantly inconsequential about the whole Apple/Swift thing that I to was amazed [silly me] at how big a deal was made out of it.

As previously mentioned, terrestrial radio doesn’t pay performers anything. In my opinion, that’s how it should be. Streaming sites shouldn’t have to either. Radio (terrestrial, satellite, or internet) is advertising for artists. Just because some entities want control and to squeeze out a few more pennies from a slightly more modern application doesn’t make it right.

Many artists create/perform, few have ever managed to make a living from only their art. If anything, more artists can make a living through their art than could before. Even if fewer are able to win the musical lottery and live like royalty.

That’s not to say there aren’t ways for an artist to make money. Live performing, merchandising, speaking engagements, patronage, etc. are all ways that artists can monetized their art. It’s been a bit of a fluke that selling copies of performances have been at all lucrative. If we want to be honest about things, even then it was mainly the labels and a very, very, very select few that benefited in any major way. The fact that selling copies of performances is disappearing as a revenue stream isn’t the end of art (music/books/movies) as we know it. It’s just a return to the way things always were.

Having said that, there are a few particulars that make Ms Taylor’s efforts even less consequential.

Apple was negotiating with the labels, not artists (as usual). Apparently the labels agreed to accept a _larger_ percentage over the life of a stream in exchange for no payments for the first three months. The labels were looking toward the long tail. If you’re a one hit wonder, sure your maximum play might be during the first three months of someone’s subscription. As an artist you may loose out. As a label with a large catalog, you would most likely earn more accepting that higher rate. Assuming of course that Apple doesn’t pull the plug in a year or so. That’s the rub. If Apple kills the service in a relatively short time, the labels loose. If it says up for years, the labels are better off. All Apple’s apparently agreed to do if go back to the _lower_ percentage from day one. Not only isn’t that much of a sacrifice to Apple, it garnered them invaluable marketing and good will. Apple couldn’t have paid for that kind of publicity.

On the matter of Taylor Swift’s albums, those in the audience paying attention would have noticed that she was only threatening to keep her latest album “1989” off of Apple’s service. That’s because the labels have control of her previous work. It’s only her latest (and I would assume any future works) that she has that level of control over.

In the end we are left with the situation of an immensely popular artist threatening to keep only her latest work off a streaming service in response for not receiving what in the vast majority of cases would be a pittance for three months and being paid slightly more per stream for as long as Apple’s service exists. The same artist who’s willing to foreclose an opportunity for up and coming artists to get the exposure they desperately need to succeed by fighting to remove free tiers from any streaming service. The 21 century equivalent of radio airplay, over what amounts to pennies of income.

In the end she isn’t doing the next generation of artists, or anyone not as successful as herself, any favors.

——-
{Here is an example of the kind of difference that we’re talking about;

Imagine that every time someone took your book out of the library you got a check for one penny ($0.01). Apple wants to start a new library. At the Apple library Apple’s proposed to give you no money at all for the first three months ($0.00). In exchange they are willing to give you two pennies every time take out your book forever after. Which is a better deal?

[these are e-books, so an unlimited number of people can check out your book at the same time.]

Year 1: 10,000 people check out your book.

A) one hit wonder = 9,000 people during the first three months, 1,000 people over the next 9 months.

B) established or up and coming artist = 3,000 first three months, 7,000 for the rest of the first year.

Years 2+: 3,000 people check out your book per year there after.

How much money would _someone_ make?

Year 1:

Apple’s original offer:
A) $20 for the first year.
B) $140 for the first year.

Typical (Taylor Swift) model:
A) $100 for the first year.
B) $100 for the first year.

Years 2+:

Apple’s original offer:
$60 per year thereafter

Typical (Taylor Swift) model:
$30 per year thereafter

Short lived ‘books’ do worse under Apple’s plan. Everyone else is better off with Apple’s proposal. In any event, it’s not a large sum by any stretch. }

Gary Pageau (user link) says:

You missed a big point

In your attempt to be “nuanced,” you made a rather large error: “her career was built on terrestrial radio play — which is a free service (the kind that Swift has attacked Spotify over) and which doesn’t pay the performers anything at all in the US.” This is patently untrue. Have you not heard of ASCAP and BMI? Terrestrial radio stations have to pay these licensing organizations for the use of music, which then pass them on record companies, songwriters and artists in the form of royalty checks.

JMT says:

Re: Re: You missed a big point

“Have you not heard of ASCAP and BMI?”

You must be very new around here…

“Terrestrial radio stations have to pay these licensing organizations for the use of music, which then pass them on record companies, songwriters and artists in the form of royalty checks.”

You were doing well until you got to the bit about artists getting royalty checks, at which point you made a left turn into Wishful Thinking Land’.

Jeffry Houser (profile) says:

Terri

Terrestrial radio play — which is a free service (the kind that Swift has attacked Spotify over) and which doesn’t pay the performers anything at all in the US.

I’ve been out of the music game for a while, however a decade or so ago; the radio stations paid money to performing rights organizations such as BMI and ASCAP. In theory that money goes to the musicians who played on the record and the songwriters.

Do radio stations no longer have to pay for the rights to use these songs?

jilocasin (profile) says:

Re: Still only to the 'top' though [Terri]

Just to add insult to injury, BMI, ASCAP, etc. don’t actually pay every artist their due.

They lump all of the money together, take out their cut (of course) and then distribute the rest to the top x percent of the acts. What that percentage is, and how it’s determined is left to the individual rights organizations discretion (any your imagination).

So, even if you are a composer or music writer, unless you are already a mega star you still won’t get _anything_ from terrestrial radio.

Excepting exposure of course.

Richard (profile) says:

Re: Re: Still only to the 'top' though [Terri]

They lump all of the money together, take out their cut (of course) and then distribute the rest to the top x

To be fair – this is true in the US – but in other parts of the world (eg UK) the money is distributed to everyone. This does create something of a bureaucratic nightmare, however, and most still get only very small sums.

Getting PAID is no nuance says:

Taylor Swift says it's not for her but those starting; Masnick nuances that away claiming 3-months not paid doesn't matter.

Masnick is sheerly asserting that those 3 months don’t matter. He has no idea what it’s like to live on narrow margin. ANY income can be a HUGE morale-booster to get out there and promote MORE. A few bucks and some cheering can make ALL the difference to people who live on hope.

But Masnick just waves his chubby lily-white 1-percenter Ivy League hand in airy dismissal: “You don’t need a cent. Be GRATEFUL, peasants, that mega-corporation Apple even acknowledges your existence. If you prove to be a draw by making tons of money for we billionaires, then we’ll pay you a pittance.”

2nd, what about one-hit wonders like Psy? Musicians DO pop to the top and disappear within 3 months. Apple would be out nothing for those yet get millions!

3rd, why should Apple get income if not risking capital? That’s the whole moral basis of “capitalism”: risking money deserves profit, IF it comes. Without paying in those 3 months, Apple is out nothing but streaming costs — which are near zero according to Masnick. This is the music phase of predatory capitalism in which the poor do all the investing of time and if become popular, then Apple makes out even more than the musicians! It’s not fair.

4th, the current music industry is justified in precisely that risky investing, usually fronts a deal of money and advice, has experts to promote and so on. It’s unfair, sure, but does have actual money losses, a practical reality which of course Masnick never mentions.

Don’t let Masnick’s phony nuances convince you that he’s concerned about fairness or musicians. He argues that Apple shouldn’t have to pay during those crucial first 3 months. Last week he might have been credible, but he risked nothing THEN.

Gwiz (profile) says:

Re: Taylor Swift says it's not for her but those starting; Masnick nuances that away claiming 3-months not paid doesn't matter.

He argues that Apple shouldn’t have to pay during those crucial first 3 months.

No he didn’t, moron. As a matter fact, Mike states the complete opposite in the article:

Let me start out this post by noting a key thing: from the beginning, it was stupid that Apple had negotiated a deal with record labels in which copyright holders would not be compensated with royalties for the three-month “trial period” of Apple’s new streaming music program. It clearly should have agreed to pay the royalties, and it was a really short-sighted move to push for a deal without royalties.

Stating that those three months don’t actually amount to much in reality is completely different than saying Apple shouldn’t have to pay the royalties.

Nuances, they’re not for everybody.

Anonymous Coward says:

Re: Taylor Swift says it's not for her but those starting; Masnick nuances that away claiming 3-months not paid doesn't matter.

  1. Doesn’t every label or artist negotiate their own contract? If those 3 months for new subscribers mean less to me than a long haul contract with a larger percentage shouldn’t I be able to make that choice?

    2. Bad example, as Psy is rather popular in S. Korea but only a one hit wonder in the global scene, but it still goes back to point 1. If the artist signed a bad deal with their record label, that has nothing to do with Apple/Label, but rather Label/Artist.

    3. If an artists refuses to release on Apple, I’m sure that Apple won’t complain. There are several examples of writers that refused to publish on the iBook app, what’s the difference? Don’t like the deal, negotiate or go another route.

    4. I’m sure that all major labels invest in promotional material, advertizing, et al for their clients. The problem is what clients receive the red carpet, and which are still left to their beat up van to travel around from Gig to gig and get next to nothing from any sales like Apple music. Remember the whole Sony contract with Spotify was published on the Verge. link Who’s screwing who?

jilocasin (profile) says:

Re: Taylor Swift says it's not for her but those starting; Masnick nuances that away claiming 3-months not paid doesn't matter.

[Speaking as someone without a chubby, lily-white, 1-percenter, Ivy League hand to wave in any direction]

First lets get this out of the way;

For one hit wonders it does suck.

Having said that, it was never about the artists. [I hope I didn’t burst any bubbles.] It was an economically reasonable deal between the labels and Apple.

Why do I say it’s reasonable?

Apple is risking capital to create the streaming service. Creating a streaming service isn’t cheap and it certainly isn’t free. Apple proposed having the labels share some of that risk initially and was willing to compensate them for that risk.

If the labels are willing to risk Apple’s service going under in a short period of time by not getting paid for the first three months, then they will be rewarded with a higher percentage after that time.

Simple;
Get paid a small standard amount, from day one.
OR
Take a chance and get no payment for three months, but a higher payment if Apple’s service survives longer. The longer it lasts, the larger the reward.

Simple economics.

As a side benefit, if someone (like say Talyor Swift) makes too much of a ruckus, cave into their demands and get more publicity and goodwill while still not being any worse off than you would have been without the deal.

For Apple, it’s a win-win, for the labels, it’s a win-status quo, for the artists…..
well no one was thinking of them anyway.

Derek Kerton (profile) says:

Re: Taylor Swift says it's not for her but those starting; Masnick nuances that away claiming 3-months not paid doesn't matter.

Funny how big “BEWARE: NUANCE AHEAD” signs can’t stop the morons from driving off the cliff.

And massive stakes in the ground like “Apple was stupid not to pay” serve more as punji sticks for idiots than clarifiers.

Anonymous Coward says:

1989

I’m surprised so few people are upset that she opened her statement with something clearly false. She said she was withholding 1989 because of Apple’s actions. 1989 is withheld from every streaming service, everywhere. It has nothing to do with anything being free or anything to do with Apple, whatsoever. Rather the idea that she can make more money from download sales by withholding from streaming. Her label which she has considerable stake in outright says this repeatedly. And they also said they are not ready to release 1989 to streaming services.

Andrew D. Todd (user link) says:

Taylor Swift and the Big Companies.

Look at a table of paper magazine circulations.

http://www.psaresearch.com/images/TOPMAGAZINES.pdf

It’s a fairly good index of how many people are willing to pay, say, $20-50 per year. Note that the three top-listed magazines are “affiliate” magazines, not really bought per se, but distributed as an incident of a discount card. Exclude the Womens Magazines, eg. Good Housekeeping. Everyone must eat, and the practical advantages of being able to cook are so great that is is really another kind of “affiliate” magazine. Cooking is not just an ordinary hobby. There are fairly modest numbers of people willing to subscribe to any kind of “fan” magazine, say, 5-10 million at most. Movie/Music fan magazines are much further down, in the 1-2 million range. Bear in mind that the United States has a population of three hundred million, and about a hundred million households.

I don’t know about Game Informer. It seems to be published by GameStop. The circulation seems suspiciously high. Is it tied to some kind of comp card?

The conclusion I draw from the above facts is that the market for an internet-based music streaming service is extremely limited unless the service is free. What it works out to is that people buy their computer, and they buy their internet access, and they expect the rest to be free. People historically listened to stuff on the radio, and you can buy a small clock-radio, with digital tuning, for less than ten dollars.

Independent streaming music services have historically foundered on the disconnect between what people are actually willing to pay and the expectations of the artists and the labels. The artists and labels get upset because their are too many free tiers, or too many free samples. What is now happening is that big companies with other sources of income are getting into music streaming. Specifically Apple, Amazon, Facebook, and Google. The latter two are basically advertising agencies, Apple sells hardware, and, indirectly, cellphone service. Amazon is a general merchandiser which competes primarily with Wal-Mart and Target. The big companies are basically willing to buy off Taylor Swift, and run their music services at a dead loss, giving away music for free, while paying artist royalties.

Speaking of Amazon, at least, Amazon would be well-advised to spend less time worrying about media and the internet, and more time worrying about their general-merchandise business. When I came to do my taxes, and figured my state sales/use tax, I found that I had spent about $1500 at Amazon in 2014, about three or four times as much as their average customer. Essentially none of this was for media or “luxury” goods, just large numbers of useful articles. That does give me a certain authority to speak about Amazon. Amazon has persistent quality control problems of one kind or another, which do not manifest in electronics or media, but which do tend to manifest in non-electronic goods. I had a very bad experience when I bought two swivel chairs from them, and the next time I need swivel chairs, I will go to the local junk store, where I should have gone in the first place. There is nothing that Taylor Swift can say to change my mind on that subject.

As far as advertising goes, from the standpoint of a businessman buying advertising, Google or Facebook advertising is a clumsy and unimaginative solution, just the way television adverting is a clumsy and unimaginative solution. anything involving Taylor Swift is likely to be a clumsy and unimaginative solution.

That One Guy (profile) says:

Re: Taylor Swift and the Big Companies.

I don’t know about Game Informer. It seems to be published by GameStop. The circulation seems suspiciously high. Is it tied to some kind of comp card?

It is, yes. Anyone who has a ‘Power-up Rewards’ membership at the store gets the magazine along with a card that gives discounts on used games, hence the high circulation for the magazine.

tracyanne (profile) says:

Taylor Swift who?

I was about to ask that, I keep reading about her on here so much, so this time I went to YouTube and played some of her videos.

I don’t think the world would stop turning if she quit the music industry.

Regarding the article, I read some stuff on other sites, such as the register, and it seemed wrong to me. It’s good to read something that puts context on the whole thing.

An interesting suggestion put forward by someone on The Register is that Maybe the whole thing was a PR stunt to get free advertising for Apple’s service.

Richard (profile) says:

Most musicians don't make a living

Most musicians don’t make a living, period. That has always been the case.

And always will be the case under any conceivable regime.

The reason is simple – any change to the financial arrangements for musicians that makes making a living easier will simply suck more people in to try to make a living until the former state (in which most musicians can’t earn enough) is restored.
There is an inexhaustible supply of competent amateur musicians just waiting for the opportunity.

It is a simple fact of economics – any activity which many people enjoy doing for free will always have a large group who are able to make some money from doing it – but not enough to live on.

Leigh Beadon (profile) says:

Re: Most musicians don't make a living

This is a comment I read somewhere else, on another blog, on a related topic, quite some time ago… I forget where, to be honest. But it’s an excellent extension of the point you make here:

“All the rhetoric about this subject continue to miss a key objective reality: that there are two separate supply/demand interactions at work here not one. It also misunderstands the real-world facts of one of those supply/demand interactions.

One of them is the supply of artistic performance compared to the demand for it. Observing that the great majority of professional-caliber artists are paid very poorly we assume that this means that the demand curve (how much people will pay, or “how much our soecity values the arts”) has been dropping. But this is factually incorrect. Both the Broadway and non-profit theater sectors nationally are vastly larger today in revenues than a generation or two ago; there are now nearly 200 salary-paying professional symphonies compared to fewer than 10 fifty years ago; annual tax-deductible contributions to arts organizations is today several times (after inflation) what it was in the 1970s; etc. Some perusal of American for the Arts annual statistical survey with an eye towards this particular question is eye-opening; the entire annual NEA budget isn’t even a fraction of one percent of the nation’s arts economy anymore. And that’s without even considering the long-term boom of the broader “creative sector” such as the film and TV worlds.

But wait: if the total amount of money in the arts sector (that demand curve) has been rising then why do so few artists earn a living wage? Because the supply curve (of artists) has been rising even faster. Check out the stats on annual graduations from music, theater and dance conservatories. The number of arts organizations keeps rising which means that the growing contributed-support pot gets divvied up more. The number of Americans reporting on their tax returns cash income as artists double in a single generation (1970 to 1990). As a society we finished eliminating social stigmas on the pursuit of a life as an artist — there are Evangelical musical-theater camps now! — and, it turns out, liberated perhaps more than anticipated.

Also technology keeps tearing down barriers to entry, e.g. I just recorded, in a studio, an album with my band for a total cost that in real dollars wouldn’t even have bought the snacks for a proper recording session in 1980 or 1960. Make something cheaper and cheaper to attempt and, it turns out, more and more people will put in the time and effort to attempt it. And some fraction of them will turn out to be genuinely good enough to pull it off.

Basically no matter how fast the demand for artistic performance has grown and is growing, the supply of artists has grown more. And what is supply from this angle is demand from another: the demand for a life as an artist. We have fully liberated that demand: now, for the first time in the history of Western civilization, essentially every person who possesses the raw talent to potentially become a professional-caliber performing artists attempts to do so. That’s a genie which won’t go back into the bottle willingly: are you willing to subtract yourself from that pool? I’m sure not.

Unless we’re willing to put back up some of the barriers which had always artificially reduced the supply of professional-caliber artists [go back to viewing actresses and actors as just one step above prostitutes and pimps, get the aspiration to sing or dance for fame and fortune back off of our public airwaves, cut the number of conservatories back to 1950s levels, institute genuine hard artist guilds, etc], then this is the reality going forward. We’re not as a society going to do any of those things, so the demand for life as an artist will keep rising faster than the demand for art. Or, put the other way, the supply of terrific and/or amazing artists will keep rising faster than the supply of the society’s interest in them. Neither is actually falling or likely to anytime soon, but one is rising faster. That’s a broad reality which all the well-meaning policy rhetoric in the world can’t overcome.”

AverageBob (profile) says:

Wow you completely missed the point

At first I didn’t want to respond to your article but I would really think about what you write before you post it. You completely missed the point, so let me discuss the nuances to your nuances.

“But here’s the problem with all of this: it’s hogwash, meaningless blather that doesn’t change a thing and will have no lasting impact.”

So you are saying that anyone who attempts to address a problem to a little degree shouldn’t bother because it doesn’t solve a larger problem.

“First, if your album is a success, there are all sorts of ways to make money beyond the royalties from Apple Music’s streaming service.”

You missed her point completely. She can support herself at this point in her career on her shows alone; most artists cannot. They need all the sources of revenue they can get. This includes any small royalties they get from streaming.

“And why does she make that much money live? Well, as Tom Conrad rightly points out, her career was built on terrestrial radio play — which is a free service (the kind that Swift has attacked Spotify over) and which doesn’t pay the performers anything at all in the US.”

First of all, you missed the fact that radio royalties are paid to the songwriter and not the performer. So in Swift’s case she was paid for radio as she writes most of her songs. Most independent artists are also songwriters. Second, you minimize the fact that Swift like many artists built their careers on radio play AND shows.

“That’s because the industry’s biggest secret, which it always tries to hide from these debates, is that the vast majority of musicians basically make absolutely nothing in royalties. This is due to a combination of factors, starting with the fact that if you’re signed to a label, the label is likely keeping nearly everything you get from streaming.”

For many artists that sign to a big label, they often sign away the copyrights. However for independent artists on independent labels (the exact kind Swift is championing and Swift herself), they still hold their own copyrights. Your point is misleading at best.

“Three months is a long time to go unpaid. But not getting paid by Apple Music does not mean “going unpaid.” It just means one small revenue stream is limited while it aims to get up to speed”

What kind of word twisting is this? If you don’t pay one of your bills for 3 months no matter how small it may be, the company involved will mark them “unpaid” and might send you to collections. Just because the revenue might be small for the average artist does not mean that they do not deserve to paid nothing and that they shouldn’t be allowed to complain about it.

“As already discussed in point one, for most musicians, this isn’t going to move the needle one way or the other.”

So the chance that streaming will not make an artist a millionaire means you can minimize their revenue streams even further? It might be $20 a month, but that’s a good meal for a “starving artist.”

“Any musician out there relying on the royalties from Apple Music to make or break their musical career has no musical career.”

No one but you is arguing this point. What Swift is arguing is that most artists need all the revenue streams they can get. Period.

“And, of course, for label-affiliated artists, much of it will go to the label anyway, and the artist won’t see any of it. “

Again, the term “independent artist” seems to eluded your understanding. Like Swift herself, some artists still have control of their copyrights.

“And that’s really unfortunate, because here’s another chance to do things right by focusing on business models that let them connect directly to fans and give them a reason to buy something. Demanding others pay you money is no substitute for convincing others to willingly pay. One is sustainable, one is not. “

Er, what? Copyright Law specifically has set up the system where payment is required for songs. It’s not “demanding” of artists that the law be followed. The only business model that is in jeopardy with streaming is the big label system. With streaming, artists could bypass them altogether and have a decent if not stellar career with the help of streaming.

“But because of this “success,” people will still cling to the false notion that the “solution” to content creators’ failure to build their own successful business model is to demand that other successful companies give them money.”

What kind of world do you live in where you think that if you play someone’s song, it’s “giving” them money. No, in this world, you have to pay them for their song. That’s how copyrights work. So when you go to the movies, is there a “donation” box in the front of the theater? No that’s a ticket box. You are required to pay to see the movie. It’s not a gift.

“This is wrong on so many levels, but that’s another post for another day. But this notion of “a savior” magically swooping.”

Oh, now I see the problem. Someone complimented Swift on her “journalism” and you immediately got hurt because it devalues your job as a journalist. So you had to attack her for it. Get over yourself.

Jaymoon (profile) says:

Whoa Whoa Whoa

…her career was built on terrestrial radio play — which is a free service…and which doesn’t pay the performers anything at all in the US…

Oh? Tell that to BMI, ASCAP, and SEASAC when they come knocking to every single radio station in the country!

Performers, maybe not so directly… But there is payout happening. That’s what the artists agree to when they sign the label deal.

Richard Stallman says:

Applie & the public

This article focuses on how Apple treats musicians, and ignores how Apple treats the public.

Knowing Apple, I’m sure Apple Music imposes DRM and EULAs on music recordings, and that it tracks what users listen to. Even one of these nasty practices is doing people wrong. Let’s refuse to be treated this way. We can reclaim our rights, if we are not lazy.

Meanwhile, we can support musicians and authors in other ways that are compatible with the right to share. See http://gnu.org/philosophy/copyright-vs-community.html for two
proposals.

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