Dave Steed: Indie label Century Media has pulled its catalog from Spotify. First of many? Or first one I’ve heard of of many that have already done it?

Chris Holmes: So now Spotify is the bogeyman killing record sales?

Zack Dennis: I’m not sure how the finances work out necessarily, but this seems to make about as much sense as them demanding that the radio not play their music anymore.

Matt Springer: This portion especially is SO PAINFULLY WRONG:

Physical sales are dropping drastically in all countries where Spotify is active. Artists are depending on their income from selling music and it is our job to support them to do so. Since the artists need to sell their music to continue their creativity, Spotify is a problem for them. This is about survival, nothing less and it is time that fans and consumers realize that for artists it is essential to sell music to keep their heads above water.

The only artists left who are sensibly “depending on their income from selling music” are selling millions of records at a swat.

Michael Parr: Damn, I really wanted to listen to … wait, who the hell is even on this label?

Chris: You mean you’ve never heard of Iwrestledabearonce?

Steed: I may just casually ignore Century Media releases when they hit my queue now. Okay, well, I already casually ignored the iwrestledabearonce album when I saw track titles like “You Know That Ain’t Them Dogs’ Real Voices, “Karate Nipples,” and “Deodorant Can’t Fix Ugly.”

Chris: Those look like the titles to bits from a Larry the Cable Guy routine.

Dw. Dunphy: Unfortunately, this also negates Devin Townsend’s recent stuff; he’s on the CM subsidiary InsideOut.

Jeff Giles: Streaming content availability is already a hot topic for Netflix, and a growing number of people have accused the company of a sort of passive censorship — in essence, as they shepherd their customers away from physical product, they create a situation where, for a lot of viewers, a substantial portion of the indie film market simply doesn’t exist. And — just as importantly — a situation where films can disappear from your queue at a moment’s notice.

I’ve already noticed a number of annoying blank spots in Spotify’s catalog, particularly on the indie side. This is all something that we should think about as we abandon our discs for the promise of instant availability. I mean, of course it’s easy enough to find anything that isn’t available on one service or other, but you’ve got to go looking for it, and that puts another layer between the product and potential consumers — consumers who are being trained to believe that anything worth having is only a click away. Make your viewers/listeners do anything else, and you start dealing with heavy audience attrition. In the long term, I wonder what this will do to the number of artists who can find the means to create.

Dunphy: It is in some sense the beginning of the “library model” for the industry. Few decide to buy the book (or Kindle file) and instead just borrow it from the library awhile. Spotify is like that in most respects and music becomes less about something you keep than something you use a little while, pass on, and then return to later…maybe.

It is the only way to compete with iTunes, and those who cling to physical product will retreat even farther into vinyl and special deluxe editions (which will return them to being really special and deluxe with limited press runs, etc.)

For those indie artists, it is an awful lot like the pre-internet days when you had to get on the radio. Only now, this radio station offers no great incentive for anyone to track down and buy the album. What that will do to them is drive them farther into Indieville, requiring more playing out and a lot more DIY promotions.

Chris: Would I be wrong in assuming that the average indie music fan is less likely to give up searching for new music just because it’s not a click away? Sure, I can see that being a problem with fans of mainstream pop, but I always thought that one of the definining characteristics of the Pitchfork/Stereogum set was their drive to always dig for new music.

To put it another way – before Spotify came along, there was little chance that I would get exposed to (and potentially start to follow) a Century Media artist. Now that they’ve taken themselves off of Spotify, there is virtually no chance, as I am not a hardcore indie metal guy. How does that benefit them?

David Medsker: I’ve only been poking around on Spotify for a couple of days, but this is who I’ve found so far:

The Boomtown Rats
The Duckworth Lewis Method
Midnight Juggernauts
Hey Champ
Delay Trees
New Pornographers

I’m making a point of playing the smaller artists in the hopes they’ll get some change, and with the exception of Attic Lights (which I totally understand), I haven’t had trouble finding anyone small or indie yet. Cheers to that.

Steed: Metal is not at all well represented on Spotify.

Jeff: I’m not saying this Century Media thing is a smart move for the label. I’m saying I think it could be a bellwether for the industry — and indie musicians — in general.

The type of listener you’re talking about will dig, but proactive consumers represent a small subset of any business. And if Spotify ultimately becomes the Netflix of music, then they’ll be essentially framing the listening experience for a lot of people who aren’t going to bother digging. Is it their responsibility to make “everything” available to their members? I don’t know. And the streaming economy creates its own set of problems for artists anyway. But I do wonder how this will effect the releases that are able to find their way to market.

Medsker: I’ve always found it amusing that the music business sales model is about targeting the person that’s least likely to buy their product. Someone still needs to explain that to me.

Scott Malchus: I’m curious to see how Spotify affects the country music industry and its ability to still sell CDs in a digital world.

Jeff: Given the number of times I’ve seen “Cracker Barrel exclusive” in country news stories over the last couple of years, I think that’s one demographic that’s still happy to buy CDs.

Chris: My guess is that there won’t be much impact. Country fans are an interesting anomaly with their loyalty to physical media. Anyway, look at the top artists on Spotify now. I don’t see one country artists in the top 50.

Matt: I think Chris is absolutely right–as much as Spotify/Rdio/streaming services can be said to “frame the experience,” I think any real music fan is going to seek out what they like, wherever it may be, as they always have. There’s always been stuff that you have to dig for, and whether it’s on a streaming service or not isn’t going to change that. You order it direct; you hit up your local indie record dealer; you buy it from the merch table at a show.

I can only speak for my experience but I would say I’ve discovered more music in the past few weeks via Rdio than I have in probably the previous two to three years. That probably speaks to my laziness in general as well as the effectiveness of streaming services. But for Rdio, at least, the ability to quickly and easily see what my friends are listening to has given me an exponentially improved ability to find new stuff, try it out, and then add it to my collection/queue/what have you. In fact, many of those discoveries came thanks to you fine folks who are on Rdio, so thank you for that.

I don’t know how that does or doesn’t impact the artist financially; the terms listed on Rdio’s website seem vague. I would assume that it does not provide the same revenue stream that buying a CD does, or even mp3s. I’d be very interested in seeing more detail here.

But unlike any previous internet-based music solution, from the original Napster through Limewire and today’s network of blogs, torrents, and overseas file sharing sites, the artist is getting SOMETHING beyond exposure. And I have a MUCH longer list of artists I’ll be looking for in my local paper to see live if I can, or to buy future releases from if they don’t make it to Rdio or if I just want to support them with a direct purchase.

I feel like this is the direction music has been moving for like a decade–like I said before, what artist is honestly making money by selling CDs or even mp3s anymore? For whom is that a primary and very significant revenue source? Taylor Swift, Metallica, Jay-Z, Lady Gaga–sure. Everyone else? I can’t imagine it is.

But record sales are part of a number of revenue streams–merch, touring, licensing, etc–that can provide a good living for a working musician. And streaming services provide an amazing opportunity to reach a much larger audience without the whole “illegal downloading” aspect that absolutely guarantees NO current or future revenue. It’s always been a key defense of filesharers (myself included) that it’s a great way to discover artists. Now that model exists in a way that provides the artist with something financially, even if a small amount, and a much larger and more controlled base for exposure.

I think the flip side of this is that we could start seeing artists totally breaking via Spotify and Rdio, probably supported with strong online coverage and a social media base. Maybe we already have in Europe and I haven’t heard about it. Just like there have been artists who made their careers through carefully-executed MySpace campaigns back in the day.

Ultimately, these are tools. They’re also gatekeepers. The difference is that now the tools are being democratized in ways they haven’t before, so the power of the gatekeepers continues to decrease. The person who goes to Spotify and grabs whatever’s on the front page is the same person who twenty years ago didn’t venture past the top twenty rack in their local Sam Goody. The person who uses Spotify, Rdio, even Turntable.fm as an active tool to find and enjoy new artists is the same person who twenty years ago probably didn’t waste much time in Sam Goody because the good shit was up the street at the hole-in-the-wall indie emporium. But firing up Spotify and digging through their “crates” is so much easier and has so much more material than even the best-stocked indie record store.

The technology, the tools are so different and new and exciting and even scary–but I think music is music, and music fans are music fans, and that hasn’t changed much at all.

Jeff: But what’s a “real music fan”? I think you’re overestimating how many of us there really are. If “real music fans” ran the world, there would be no such thing as an AC format on the radio dial (and our pal Ted would be out of a job). The majority of the listening population is very passive about what it hears.

Under the industry’s original model, this had a withering effect on indie artists — not only was it hellishly expensive to get anything recorded, there were also very few options in terms of distribution and delivery. You had to get past the gatekeepers. The flip side to that was that we still had a monoculture, so once you got past the gatekeepers, it was a lot easier to earn a living, by simple virtue of the fact that you had a more or less captive audience. Most people were fine choosing between whatever the major labels released.

Now, the original model has been crushed. We’ve destroyed the old delivery mechanisms, and distribution is so pervasive that music has become just another commodity for a lot of young listeners. And if the next step is a streaming one-stop store like Spotify that can’t or won’t come to terms with indie labels/artists, then I think we’re right back where we started — only this time around, there aren’t as many options for purchasing physical product. And that might be the paradox of the digital era — that all this instant access will have a winnowing effect on what’s really available below a certain sales threshold. (And to answer your question, the difference between a sale/download and a stream is the difference between 7 cents and .000007 cents. No, most artists don’t make their living off album sales, but that’s still going to make a huge difference to artists across the spectrum.)

I don’t know. I’m half spitballing and half playing devil’s advocate here, but I do think stuff like this is important to think about as we stampede toward the cloud.

Matt: I think the fact that the majority of music listeners are passive is very true, but has nothing to do with this argument, since it’s always been true. It’s not like Spotify is turning real music buffs into listless drones.

that’s what I was getting at with the “real music fan” bit, and that was probably a poor choice of words. What I was trying to say is that anyone who is passionate about any type of music is going to seek that music out, and the fact that Spotify does not carry it or chooses not to publicize it on its front page is not going to change that. Nor will it probably get many of the passive listeners to dive in and start discovering new things, especially since the front page makes it so easy to basically get a lot of very popular music for free. I hope that’s not true, and it helps get lapsed or listless listeners into the active role of finding new artists and supporting them; I guess we’ll see how that goes.

Under the interim model, let’s call it, which I see as the era between CDs and streaming, you basically had a simple model for listeners to get this all-you-can-eat music buffet. Steal it. Steal it however it’s easiest or fastest. The artist gets nothing and has no control over how or where or when the music is consumed. That’s not going to go away, even in the face of streaming services.

Today, with streaming services, the artist gains two things:

1) Money.
2) An organized platform with which to distribute and control the music more effectively, which also in some cases comes with exposure (though this is not automatic; it still requires the same leg work it always has).

As #2 gains a stronger foothold, I think we will see artists who are taking the risk to effectively “release” their music primarily through Spotify. If you have a fanbase and digital infrastructure for supporting them (social media, e-mail lists, good website), why not do that? You may get far less money from streaming vs. sales but your access to listeners and the ease with which they can try the material has suddenly skyrocketed. This can lead directly to increased attendance at shows, improved sale of merchandise, etc. That’s where you get to the more “collectible” or “niche product” aspect–a kid who finds an album by an indie artist on Spotify, then follows the Twitter handle, will be receptive to buying a $25 version of the next record with a CD and a T-shirt or whatever, because he found the artist in the first place using the service.

So I don’t think this will necessarily mean artists being unable to make it below a certain threshold, especially because those artists have probably already faced these issues and either adapted to the new industry order or gone back to their office jobs. I could also see a startup quickly adapting a version of the technology to help support this indie base in a more artist-friendly way. Hell, I’d love to see that happen for movies too–a Netflix alternative that wasn’t just about competition but about catering to smaller audiences with more niche content at a price, maybe even at a premium.

As to #1, the money issue, not sure what to say there–the 7 cents versus .000007 cents is a pretty stark comparison. I guess all I could possibly say there, and it will seem like a pretty shitty argument, is that .000007 cents is more than any given artist was making under the old digital model, where if you were really lucky, you got some mp3 sales via iTunes or Amazon, but more likely someone just found your record on Rapidshare and swiped it. I’m guessing too as these services get popular, there will be an inevitable price increase–the 9.99 all-you-can-eat per month seems insanely low when you look closely at what’s being given.

To me, at least as much I can understand it, this is a classic “long tail” conversation. Down at the tip of the tail, artists will be using Spotify in clever ways to enhance the work they are already doing to cater to their narrow fanbase and expand it as much as possible. It’s going to be essentially a new marketing tool. For the big artists, not much will change because they’ve achieved enough critical mass to diversify, succeed, sell through at Walmart, etc.

Dunphy: One thing that has not been discussed yet is that, among a sector of computer-savvy people, all you need to do is stream something once, rip it off with any number of programs and you’re done. Sure, the sound may not be optimal, but when has the HMS MP3 Piracy ever been about good sound?

Matt: I feel like I traffic pretty regularly in the dirty scamp pirate corners of the internet, and I don’t feel like this is or will become a very common practice, unless people suddenly stop selling CDs or mp3s altogether some day. The appeal of Spotify is that you have the music there whenever you want it, not that you have the music to then take the trouble to create a poor mp3 which you can then hoard on an external drive. I’ve never seen this type of activity take common hold except in the case of maybe early leaks or streams of an album before release, although again, maybe people are doing it and I just don’t hear about it.

Dunphy: It just seems like a golden opportunity to grab obscure stuff (if only until it gets shifted out). I don’t know though. For me, having everyone’s library at my fingertips isn’t as appealing to me as I thought it might be. I’d rather have mine and say “good day.”

Dan Wiencek: I agree that exposure via Spotify or Rdio is better than nothing, and it’s reasonable to assume you might get some paying punters at your next gig. But the one argument that I don’t quite buy is the thought that listeners exposed to an artist through Spotify will then go on to buy a future release of that artist, whether on CD or as a paid download. Why would they do that if the milk is already free?

These arguments often seem to center around finding a way to save the album. I don’t think it can be done. I think the Album Age is just about over. The technology that spawned it, though adored and fetishized by a minority of listeners, is obsolete, and today there are steadily diminishing motivations for artists to express themselves in 45-minute, 14-song chunks.

Dunphy: This is very true. Spotify only increases the validity of a singles-only market.

Chris: Indeed it does, because as we all learned during the height of the CD era, very few artists have enough good material to fill a 42-minute album – let alone a 70-minute CD. Far too many artists, however, got accustomed to benefiting from record company largesse and the fact that people were by and large stuck for options to acquire music.

Since we’re spitballing ideas here – I think it would be more than reasonable for an artist to distribute a single on a service like Spotify, but sell other material directly to fans. If Field Music (one of my current favorites) decided to release their next single for free but then offer an .mp3 album from their site for 5 bucks, I’d snatch that up in a heartbeat.

Dunphy: See, Field Music is one of those groups that I would think would crash and burn on Spotify. Half of (measure) I immediately loved, and half was utterly perplexing. I had to physically have the album and work through it to finally appreciate it completely. Had it been through Spotify, I think I’d have given up too easily when every song wasn’t exactly like “Effortlessly.”

Scott: Ever since I got Spotify I’ve listened to more complete albums than I have in the past year. I’m especially enjoying being able to explore a lot of old blues and postwar-era music.

Medsker: Anyone else notice a sharp uptick in the number of EP releases in the last year?

Matt: They probably wouldn’t, Dan, I agree. Although I don’t think the possibility is ruled out completely. I’m thinking more specifically of all the other ways artists can make money from their music.

I feel like I’m living ten minutes in the future or something but I can’t be the only person who’s noticed that the historical ways to make money in the music industry are all but dead. This includes but is not limited to the CD sales racket, where a label gives you an advance, you make a record, they try to sell it, you tour behind it, radio hopefully plays it if you’re very lucky, etc.

Today the most prominent artist I can think of who is making her way in total, successful long tail independence is Amanda Palmer. I don’t know if she has a label deal or not but I know she’s worked hard to build up a complete infrastructure of communication directly with her fans, and in doing so, she’s able to monetize her art in ways that completely bypass any form of historically traditional music transaction (go to Big Box–>find CD–>pay for CD–>crank CD on boombox). She announces a show via Twitter, sells tickets in hours. She puts out a new album, offers it in every possible configuration possible, including high-end collectible packages for hundreds of dollars, and sells out of those! But that’s not just a record–it’s a record plus a T-shirt plus a personal phone call or some shit. I guess that makes it less about the music? But again, I feel like that ship has sailed! It’s like we’re all swimming to catch up with the Titanic or something.

(this makes me think back to that “Kickstarter for indie touring bands” thing we talked about–what an amazing tool that could be. Instead of booking a tour with the vain hope that somehow you’ll be able to pack small bars on a weeknight, you can use social media tools and other internet tools to communicate directly with fans through that site, and set up a tour that almost guarantees you will be playing for actual people most of the time. And if they care enough to take those steps, they will probably buy the exclusive live EP that you offer that won’t go to Spotify for six months or something. Or they’ll pay an extra $20 for a pre-show with some snacks and an autograph. It totally opens up so much more potential than the traditional indie touring model.)

I”m sure Amanda Palmer is one of the most successful people doing this. I can’t imagine she’s some statistical outlier alone in this, though. She’s the type of example I’m thinking of. You’re marketing to a proven niche of people who will spend money on you because they love your work. The music becomes part of an overall experience rather than just the centerpiece of the experience. So distributing the music is less about making money off that distribution and more about using it as part of a larger plan to monetize the life of a working artist.

Mick Jagger said this last year, and I think it’s so so true:

…people only made money out of records for a very, very small time. When The Rolling Stones started out, we didn’t make any money out of records because record companies wouldn’t pay you! They didn’t pay anyone!

Then, there was a small period from 1970 to 1997, where people did get paid, and they got paid very handsomely and everyone made money. But now that period has gone.

So if you look at the history of recorded music from 1900 to now, there was a 25 year period where artists did very well, but the rest of the time they didn’t.

Here’s how I’ve listened, most of the time: I hear stuff, while I’m always reading about stuff and getting recommendations of other stuff and just thinking of random stuff I want to hear.

In the past, so much of that music has just slipped through my fingertips because I had no system or storage method or whatever to actually capture it all and use it. I made lists, and I would pile mp3s onto my iPod, and I’d listen to some of it. But not nearly all of it.

What amazes me, and thrills me, is that with Rdio, I’m paying 9.99 to basically always be able to say, “Shit, lemme try that,” and then painlessly try it, almost instantly. Or add it to a queue or playlist to try it later.

that’s how it’s really revolutionized how I consume, enjoy, and discover music. Plus on Rdio, I’m getting a constant feed of stuff that all of my Rdio friends are grooving on, and I can pick through that and discover and listen that way too.

I think it’s flat-out amazing. A bargain at twice the price.

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