Music industry feels crippling effects of free streaming...

Free Music, at Least While It Lasts
JUNE 8, 2014

Late last Thursday, I stopped at the fruit stand and some big, vivid red grapes caught my eye. The vendor said a two-pound bunch would be $6, which seemed steep. I was about to tell him as much, and then came to my senses and gave him the money.

I wondered why I hesitated when it came time to pony up and realized that, as just one more participant in the Something for Nothing economy, I’d grown accustomed to getting all sorts of lusciousness for the price of zero.

Throughout that day, I used a suite of services from Google — email, contacts, documents — for a price of nothing. I deployed a free app called HopStop to plot my subway route to Brooklyn to meet my daughter for dinner, then used free mapping built into my iPhone to navigate to the restaurant. Along the way, I listened to song after song on the free version of Spotify. There were some nominal charges for the data services, but in general, I was free-riding.

The outbreak of free is being felt all over the economy, but music is an industry that has produced the soundtrack of contemporary American life. Artists are singing the blues about the crippling effects of streaming, and no one wants to be part of the day the music died.

Music has been free for decades through the miracle of ad-supported radio, but streaming services feel different because I can listen to what I want, whenever I want. The implicit promise of radio has been that consumers will hear a song they love and buy it. But when I love something on Spotify, my response is to listen to it some more on Spotify. I could pay $10 a month for the premium version and have done so in the past, but for now, I’m sticking with the free service and put up with an occasional commercial.

With scarcity now gone, songs are in the air, a mist we move through like so much department store perfume. We are no longer collecting music; it is collecting us on various platforms.

Spotify has doubled its number of subscribers, paid and unpaid, in the last 18 months and reached a milestone of 10 million paid subscribers worldwide last month. In May, Pandora served up 1.73 billion hours of music, up 28 percent over the previous year. The two services have important differences, but they both have premium pay options as well as ad-supported free models. And Amazon, Apple and YouTube are all moving swiftly into the streaming space.

It is a very new world with behemoths crashing in, looking for a place to profit in a regulatory environment that hasn’t evolved much since before the Rolling Stones made a good record. On Wednesday, the Justice Department announced that it would review the 73-year-old agreements that govern Ascap and BMI, which oversee licensing for radio stations, public spaces and websites. The agencies collect close to $2 billion a year in royalties, but operate under consent decrees that they say do not give them the flexibility to negotiate workable deals in an age of streaming.

Many labels and the musicians and songwriters they work with say streaming outfits risk wiping them out by paying tiny royalties, but the people who make all that yummy music are actually being loved to death by fans who expect it to be free.

And it’s only going to become worse. Hand a music CD to a 10-year-old and ask her what it’s for. Most will never see a song as something that was imprisoned on a disc or a download that you had to pay for.

And it’s not just tweens. A few weeks ago, we had a garage sale at our house and I was willing to part with only about half my books. But when I looked over my collection of CDs and thought about what I wanted to keep, my answer was, um, nothing. There were hundreds of them, carefully collected for more than a decade, some of them gifts, some of them even recorded by friends or bands I had written about, but they’ve been idle for years. I priced them at a quarter each and then some guy offered $35 for the whole bunch and we caved. We even threw in the rack.

Books have retained some value in an evolving personal media ecosystem, partly because the physical artifact is more attractive than the plastic CD case (which can be opened only with a crowbar). CD collections no longer signify cultural identity. (LPs, which are making a niche comeback, are a different matter.)

Music’s jailbreak began almost as soon as songs could be rendered in ones and zeros. When Steve Jobs of Apple decided that the price for a song was 99 cents, he “saved” a record industry besieged by piracy by burning about half of it down. People ceased buying albums and bought only the songs they wanted, a disaggregation that wiped out inefficiency — which is profit by another name.

Between what I bought and what I burned, I ended up with about 7,000 songs. But guess what? I don’t listen to those, either. Why would I when I can mindlessly push a single button?

I wrote a profile of Neil Young a while ago in which he railed about the loss of sound quality, but as Clay Shirky, a professor at New York University’s Interactive Telecommunications Program, has said, “good enough is good enough.” The convenience of pushing a button on a handheld device that streams wirelessly to a speaker is always going to trump hunting down a CD with marginally better sound and plopping it into a player.

Think I’m the only lazy one? Sales of digital downloads dropped a whopping 13 percent in the first quarter of this year after falling 5 percent in 2013, which was the first year since the debut of iTunes that sales of digital music dropped. Apple has certainly noticed; Less than two weeks ago, it announced it would buy Beats Electronics in a $3 billion deal that includes a fledgling streaming music service.

The acquisition also included the expensive Beats headphones — $300 and up in a variety of colors so they also serve as fashion accessory. People will still pay large money for devices, and this weekend, thousands of people will spend at least $250 for three-day access to the Governor’s Ball Music Festival in New York. It’s a curious disconnect: Fans will pay top dollar for a music accessory or a music event. They just won’t pay for, oh yeah, music.

Writing in The Daily Beast last week, the musician Van Dyke Parks said that in the good old days, a song he recently wrote with Ringo Starr would have provided him “with a house and a pool.” But at current royalty rates, he estimated that he and the former Beatle would make less than $80, which means he will have to choose between a dollhouse and a kiddie pool and then share it with Mr. Starr.

Superstars like Beyoncé can drop an unannounced bomb on iTunes and sell a million copies in under two weeks, but most artists are having trouble treading water in the stream. Streaming services argue that as their subscriber base grows, musicians will be able to survive on many small slices of a very big pie.

On the bus ride home from dinner last week, I streamed most of the wonderful new album from Parquet Courts, courtesy of the Something for Nothing paradox. The $6 grapes were delicious, by the way, but I consumed them slowly and consciously, each one carrying not only lusciousness, but the knowledge that I had paid for them.


Twitter: @carr2n

A version of this article appears in print on June 9, 2014, on page B1 of the New York edition with the headline: Free Music, at Least While It Lasts.


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