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Entries in Spotify (4)

Friday
May272011

The end of the download is nigh

If internet rumours are to be believed, June 6 2011 may possibly be the music industry’s equivalent of “The Rapture” (for those of you who haven’t been on Facebook recently, or have been living in a hole in the New Forest, "The Rapture" was beginning of the end of the world, and was supposed to happen on May 21. Nothing of the sort happened, unless you are reading this on a cloud with Jesus or you are feeling rather hot and can’t concentrate on this article because a devilish imp is poking your bottom with a pitchfork). Of course “The Rapture” turned out to be a damp squib, but June 6 is more likely to live up to its reputation as being a day on which the music industry will change forever.

So what’s happening on June 6? Well, according to a multitude of newspaper articles and blog posts, it’s the date that Apple may unveil their ‘cloud service’ – a system that lets listeners stream music from the web. Now, as the cloud service in question hasn’t been unveiled yet, it’s not clear what form this is initially going to take. It could be that Apple are simply going to offer something similar to Amazon and Google’s new cloud systems, which allow you to upload and stream your music collection on the web, wherever you are.

But frankly, that’s a pretty boring approach, and unlikely to be what Apple’s “cloud offer” will be. If rumours are to believed, Apple have been working hard to secure licensing agreements with the “big four” record companies – Warner Music Group, Sony Music Group, EMI Group and Universal Music Group – which means all this is heading in one direction: a streaming service similar to Spotify’s, where listeners will eventually be able to stream whatever music they like (for a fee, of course).

If Apple does go down this route, it means that an en-masse switch from paid-for downloads to on-demand music streaming is now just around the corner – the rise of 3G web connections, increasing use of smartphones and Apple’s 75%-85% share of the download market would more or less guarantee that streaming becomes the de facto way that music is consumed. If Apple release a software update for iTunes containing streaming functionality, millions of iPod, iPhone and computer users in general all around the world would suddenly be able to stream music instead of paying to download files. The choice of tracks would be vast – significantly bigger than Spotify’s library, due to full music industry buy-in – and the reach of the service would be enormous too, thanks to Apple’s strong global position in both the download and mobile device markets. All this would arguably result in death of the download, and pretty quickly too.

What would be the impact of this on musicians? Well, for bands who are signed to a label and getting a significant marketing push, it would be fairly good news – it makes their music even easier to access. For musicians without a budget however, it would represent more of a headache. This is because streaming removes the attractiveness of a key tool used by musicians to entice people to sign up to email updates: the free download. For several years now, indie musicians with any clue whatsoever have been giving away downloads in exchange for the ability to communicate with fans online – with individual tracks, EPs or even albums being swapped for email addresses or Facebook ‘likes’. However, there is not much of an incentive for a potential fan to grab a free download from a band if a) they don’t really download music anymore and b) the track can be streamed anyway on iTunes.  

The free-download-for-email-address scenario that we’ve seen over the past few years has led to a situation where clued-up independent musicians have, to a certain extent, been able to bypass traditional gatekeepers – labels, journalists, distributors, promoters and radio stations – yet still make quite respectable amounts of money from music via direct-to-fan sales. Perhaps it’s a negative way of looking at things, but with downloads diminished as an incentive for joining a mailing list, indie musicians will be able to communicate directly with fewer and fewer listeners online; so ironically, technological advancement may lead us back full circle to a situation whereby only those with serious budgets can introduce consumers to new music - and create any demand for it.

But if you are an indie musician who has built a business model on free downloads, and all this does sound like the end of the world, don’t despair yet. Pretty much every technological development in the music industry has shut one door only to open another; and with all these developments, the trick is to stay ahead of the curve. The musicians who twigged that free downloads helped build databases first built the biggest databases (and sold the most music and merchandise); and it will be the musicians who twig how best to use streaming cleverly who will monetise the new landscape. The trick is to think fast. But the end of the download is nigh – get ready.

 

I originally wrote this article for Prescription PR, who are a great indie music PR company based in Cambridge; musicians in need of publicity, check 'em out. 

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Tuesday
Oct062009

The death of the MP3

As many of you know, I've been quite an advocate of independent artists giving music away for free. Not because I don't value music, but because I don't think that indie musicians - and many established ones - have much of a choice around this. Digital technology and the internet has created an unlimited supply of recorded music, which means the real cost of it is rapidly approaching zero.

I've tried to take advantage of this as much as I can, by giving away MP3s in exchange for data. The idea being that you get my album free, but I can contact you about other stuff that you might want to pay for, like gigs or t-shirts (I've yet to do the latter: I find the idea of somebody wearing an item of clothing with my face on it a bit perturbing). It's working fairly well, with thousands of people now owning a digital copy of Twisted City, and more and more strangers - yes, strangers! - attending my gigs.

But I'm increasingly aware that this 'business model' is slowly - or perhaps not so slowly - becoming of limited use. This is because like the wax disc, vinyl LP, 8-track cartridge, cassette, minidisc and CD that went before it, the (downloaded) MP3 is going to die out...and soon.

Why is the MP3 in its death throes? Because a combination of streaming and increasingly sophisticated mobile devices connected to the net are starting to give people instant access to vast, online music libraries. Soon, there simply won't be a need for people to store MP3s or carry them around on iPods (believe me, these currently hip devices are going to look very quaint in the not-too-distant future). The humble MP3 represents the last incarnation of paid-for recorded music; and soon it will be a relic of the past.

What this means, of course, is that the current practice of artists giving away downloads in exchange for email addresses is also going to come to an end, and fairly soon. Which is a shame in many ways, as this has created an opportunity for musicians to generate large fanbases, and a cheap means to sell stuff direct to listeners, without record company involvement. If the MP3 is no more, with it dies the incentive for people to submit data for music; they'll just turn to Spotify to listen to stuff instead.

And where will this leave the record companies? It's an interesting question. Obviously if there is no recorded music left to buy, then they can hardly sell it. What they can sell though is concert tickets, because there is still a profit to be made from live performance - you can't make a digital copy of that. The result: record companies are going to have to become concert promoters if they want to survive.

So I think in about 5 years time the de facto model for the industry will be this:

1. Record company signs artist.

2. Record company advertises artist on TV, radio etc., encouraging people to stream their music on Spotify (or whatever the streaming service du jour is in 2014).
3. Fans do what they're told and stream Lady Gaga's new single (or whatever the electro-pop-cum-performance-artist sensation du jour is in 2014).
4. Record company puts on shows for the artist and sells tickets for them, taking a huge cut of sales.
5. If artist doesn't shift enough gig tickets, he or she is dropped, which means, yes, you got it...the artist is beholden to the record company again!

So if I were running a record company right now - and technically with my small label, Brownpaper Records, I suppose I am - I'd be turning it into a promotions company and looking for ways to get as much of the ticket sales pie as possible. And a cut of of everything else that's going too - publishing, sync rights, merchandise and so on. The buzz term for that is the '360 degree' model. I call it the piece-of-everything-you-ever-make-or-I'll-sue-your-ass model.

And if I were an artist, I'd start giving away dem MP3s like mad while you've still got people walking round with iPods. Yes, here it comes, the plug for the album: download it here. Free.

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Wednesday
May062009

The charts they are a-changing

Traditionally, music charts have been all about music sales. You sell records, you get in the charts; you don't, and you spin yourself as an serious, tortured act with a cult following who wouldn't be seen dead on a hit parade. Frankly, I know which camp I'd rather be in.

The UK (and other) charts have undergone a number of changes over the past few years. As physical cd sales declined, the chart rules were modified so that MP3 sales on iTunes and other digital retailers were taken into account. This led to some interesting effects: popular album tracks started entering the single charts; and obscure songs that had not been released as physical singles started to make surprise appearances, due to positive word of mouth and "grassroots" followings of underground acts.

The charts may be about to undergo another profound change. This is because I think that conventional sales - upon which charts are built - are on the way out. It seems increasingly likely (thanks to services such as Spotify) that people soon won't buy MP3s or cds any more, but will stream whatever songs they like over the internet (either on a subscription basis or by agreeing to hear adverts between tracks).

If this happens, the focus of charts is inevitably going to switch away from sales to the number of plays of particular songs. To a certain extent, this is already happening. The music social network Last FM currently tracks what its users are playing (see http://www.last.fm/charts for what's currently hot) and Spotify also shows you how popular tracks are as you play them.

In many ways, this emphasis on how many times songs are played is a more accurate reflection of the popularity of music than music sales. After all, a lot of people may buy a track - say, a novelty or charity single like Mr Blobby - only to rarely play it. Equally, a great album, released by an independent artist, may not sell many copies but get repeated plays by a dedicated, small following.

Interestingly, what all this raises is the possibility that some sort of 'song quality' indicator may emerge - something that goes beyond telling us how many people own a song, and lets us know how many people actually like a song. We could arrive at this indicator by dividing the number of plays of a track by the number of people playing it; for example, if 10 unique Spotify users play a song 100 times, you could give the song a popularity rating of 10 (100 divided by 10). But if the same 10 users played another song 1000 times, that track would have a popularity rating of 100 (1000 divided by 10).

Listening to music has traditionally been viewed as an intensely subjective experience, but what examples like the above point to is that maybe beauty does not entirely lie in the eye of the beholder. Perhaps certain songs have intrinsically good qualities that charts have not, hitherto, been able to highlight accurately. Online data could change all that, and start to highlight the fact that some songs have inherent and enduring appeal.

As with so many other things right now, the internet is allowing us to measure our behaviour in entirely new ways - and leading us to make remarkable conclusions about things. I wasn't really expecting the net to tell me how well-written a song is; but it's now looking like a distinct possibility. To conclude, the internet will become a rock critic.

Crikey.

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Tuesday
Apr282009

Spotify

A while ago I wrote about the future of rock and roll. The future, in my view, was that that rather than being bought, music would either be swapped for data (email addresses), or would be provided through an on-demand streaming service where listeners stream tracks for free so long as they listen to ads.

The 'music for data' half of that future arrived a while ago, with Radiohead's 'honesty box' release, In Rainbows; the second half has now arrived too, with the release of Spotify.

Spotify is a program which, once installed on your computer, allows you to legally stream pretty much any song you want (using an iTunes-style interface). But every three songs or so, you have to listen to an advert before you can play another track. Alternatively, you can pay £9.99 a month to listen to as much ad-free music as you like (about the cost of a newly-released chart cd).

Spotify represents a revolution in how we consume music - and if this way of listening to music becomes the norm (which I'm pretty confident it will), the implications for the music industry are enormous. There are three areas which I think will be particularly affected.

First, I've got a feeling that Spotify will slowly spell the end of the line for iTunes and other digital download services. Ok, so you can't currently download anything from Spotify on to an MP3 player - you have to play tracks through a computer that's connected to the internet. But that scenario is likely to change quite quickly, thanks to mobile broadband connections. If people can start streaming music from the internet onto their mobile phones using Spotify and 3G connections, then the need for MP3s becomes redundant (indeed, a Spotify application for the iPhone is already being discussed).

The second big impact is going to be on radio stations that primarily broadcast music. If a mobile phone version of Spotify comes along, you can pretty much take any music with you, anywhere. I'd be amazed if this didn't have an impact on the likes of Radio 1 and Radio 2. They might have to change their content somewhat to attract new listeners - I can imagine a lot more chat or documentaries about particular artists becoming a part of their schedules, to compensate for the fact that people are getting their music on the go elsewhere.

Finally, it's going to impact artists. If Spotify or a similar service becomes the de facto way to listen to music, then the whole idea of physical album sales is finally dead. Musicians will generate income from each play on Spotify - the PRS will make sure of that - but I doubt it will be as much as the income that physical cds used to bring in. Also, if the number of people who listen to radio stations falls, then so will royalties, so it will be hard for us rock and rollers to make money that way too.

Ultimately what all this spells for artists is that in future, the real money is going to be in gigging. Instead of record deals, we'll be looking for promoters to put us on a tour - in fact, I think the record companies are slowly morphing into promoters.

That's because a live performance by your favourite band in a real venue is one thing that the internet can't yet provide...but watch this space.

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