Ausmusic Month: Making music in regional Australian studios
Does the rise of streaming mean the loss of music?
Revenues from live performances are expected to grow. The Conversation
By Professor Richard Vella, Shane Homan and Tracy Redhead
November 28, 2016 07:21:47
Punters cheer at an Australian festival. (ABC)
Prince's record label sues Jay Z for song streaming
The 2015 Worldwide Independent Network report on the global economic and cultural contribution of independent music showed that independent labels have 37.6 per cent of the global market, worth $5.6 billion.In relation to music distribution, academic Patrick Wikstrom writes that technological changes consist of three models: ownership, access and context. Video: Justin Timberlake on trolls, technology and evolution
Musicians today must be multi-skilled. The royalties paid back to artists for streaming or YouTube dissemination are minimal — only massive amounts of streams can produce substantial income. The revolution in the 1990s of audio software platforms such as Protools and Cubase enabled creators to be producers of their own music, cutting costs dramatically. The music industry is currently in a state of flux — due to the internet and digitisation — as are many other industries affected by technological and social changes. (ABC)
The CD as calling cardAs with all previous eras, the music industry is highly competitive. The release of new cars and computers without in-built compact disc drives is further evidence of the change in consumer behaviour. A recent Price Waterhouse report predicted revenue from performances would rise by 3 per cent annually through to 2020. This is the “value gap”. In Australia, combined revenue from all income streams for musicians actually increased last year to a historically high growth rate of more than 12 per cent, according to APRA-AMCOS.Crucially, in Australia, digital revenue (downloads, basic and “premium” streaming services, on-demand video, website use and user-generated services) provided the impetus for growth from $47 million to $68 million from 2015 to 2016. But this endless re-working/bundling/re-contextualisation of digital music is, of course, not well served by older 19th Century frameworks of copyright protection.Many income streamsToday’s musician relies upon many income streams: live performance, royalties from performance, recordings, synchronisation rights, teaching, licensing, merchandising etc. This has provided some correction to earlier industry periods bereft of answers to the spectacular rise of downloads and file-sharing of music mp3s through computer systems.Obstacles remain. The consumer transforms from passive recipient to active co-creator. Musicians must adjust to these changes and to consumer demands.This means not just changing distribution formats of music, but also musical forms. Suddenly, music was being played with no compensation or income streams available.Record companies worried that sales would drop. When radio became popular in the 1920s, many believed this was the end for recording artists and live music. The “ownership model” has dominated the last century with the sale of recorded music on formats like CDs and records.The “access model” refers to the rise of online subscription-based music streaming services like Spotify. These days there is now music that adjusts to your mood or activity like Spotify “running”, a playlist tailored to keep energy levels up while exercising, or Melody’s Virtual Reality player, which will allow audiences to watch and stream concerts in 360 degree surround visual and audio from their own lounge room.The increased complexity of digitisation, and related changes to cultural products, business, trade and consumption, require massive innovation. Photo:
Montaigne accepts the ARIA for Breakthrough Artist (AAP: Paul Miller)
Can’t get enough of the ARIAs? Each block is like an individual bank statement and a permanent record of a transaction. Also needed are innovative new copyright and royalty models before new revenue streams can be realised.Richard Vella is the Professor of Music at the University of Newcastle; Shane Homan is an Associate Professor in English, Communications and Performance Studies at Monash University; and Tracy Redhead is a senior researcher in Music Export and Technology at the University of Newcastle. It is transparent, open and immutable. But independent music labels — which provide an important platform for new talent and music-making — are disrupting this paradigm with new business models and artist/audience relationships. However, history shows these industries are always in flux. Consumers are now informed, connected, empowered and consequently have more market power. It requires continual exposure through performance and/or product availability via distribution and social media platforms. While aggregator services such as YouTube rely heavily on advertising, hundreds of millions of users can freely upload and watch content, producing a significant gap between usage and payment. Venue owners believed people wouldn’t go out and see live music any more. The authors are part of a research team investigating the economic and cultural value of the Australian music export.Originally published in The Conversation. (12-inch mixes of LPs, for example, came in response to DJs sampling and creating mix tapes in the late 1980s and early 90s). Musicians’ Unions and Performing Rights Associations fought for compensation and a slice of radio advertising revenue.This is a complex story to summarise, but it took nearly 15 years to implement new copyright and royalty models for musicians. (Flickr: monophonicgirl)
Social media platforms have enabled musicians and music companies to develop new strategies for distribution that disrupt the more traditional linear supply chains dominated by the major record labels.Under the old, linear model, a series of intermediary steps (contracts, production, publishing, distribution, promotion) eventually lead to a retail outlet. In the first decade of this century, the emergence of web 2.0 has propelled the democratisation of production tools resulting with the rise of “the Produser” (coined by Axel Bruns) — part producer, part user.The new digital economy is a shared economy, built increasingly upon user-led content creation. It is not enough to be “talented” and hope to be discovered. A “context model” enables audiences to “do things with music”. These days the CD, like vinyl recordings, has become more like a calling card and promotional free giveaway by artists. Australian music sounds like … For Spotify, royalties are around $0.006-$0.0085 per play; YouTube is $0.001.A legislative solutionBut the solution is legislative. We asked some stars of Australian music a simple question: “What does Australian music sound like?”
To state the obvious: contemporary music industries are struggling to find new ways to connect with audiences and create value in their products and services. There is now a worldwide push to address this value gap so that more of the royalties go to the copyright owners. Photo:
Tame Impala’s Kevin Parker recording in a farm house near Bunbury. For musicians, it has the potential to be a smart contract embedded within a music file that automatically sends licensing, payments and usage agreements to anyone using that file around the world.Blockchain is in its early days, with problems still to be solved (relating to bandwidth and issues of consumer trust), but it could signify the future. The loss of music Whenever you listen to a streamed song, like it but don’t buy it and instead stream it again, you are casting a vote for the future nonexistence of professional musicians, writes Professor Peter Godfrey-Smith. Once music has been digitised, it can be changed into any format. Amongst other things, it would oblige companies such as YouTube to work with copyright holders (labels, publishers, individuals) and address the value gap between those who own the rights for music and the creators of it.Then there is Blockchain, currently being trialled by global banks and seen by some in the music industry as a possible future solution to copyright problems.Blockchain is a public decentralised ledger used in digital currencies. Test your knowledge with our quizCheck out the best photos from the red carpetSee which Aussie acts have won Best Album over the yearsAnd were you at the 1996 Crowded House concert? In September this year, the European Commission published a proposal on copyright in the Digital Single Market to address the value gap. Streaming, downloading and stem releases (the creation of groups of audio tracks, processing them separately prior to combining them into a final master mix) are for the moment the main consumption models (with a nostalgic resurgence in high quality vinyl).This fact is reflected in the 2015 International Federation of the Phonographic Industry report, which shows that digital sales of music made up 45 per cent of the market.Physical sales (CDs, vinyl) comprised 39 per cent, with performance rights (broadcasting royalties) at 14 per cent and synchronisation (rights aligned with uses such as film soundtracks) at 2 per cent.Beyond digital sales, the other growth trend is in live performance revenues. Photo:
Nick Murphy, formerly known as Chet Faker, is signed by independent Australian record label, Future Classic. But as the radio example shows, there is a well documented history of musicians adapting to technological and social changes over the past century.As long as there is technological innovation, musicians and the industry that supports them will either embrace these changes or feel threatened. Survival today requires musicians embrace these new approaches — either individually or collectively — in order to reach their audiences.This is hard work.