Facebook Planning Music Streaming Service to Compete With Apple Music and Others [Updated]

[jmgregory1]

Millenials in general are kinda poor and there is more music coming out faster than ever before. If you appreciate a wide variety of music you don't want to let local radio stations curate it for you. I like Taylor Swift fine but I also like Vampire Weekend and I never would have heard them on my local radio stations.

Not to mention, at this point there is a massive amount of quality music for young people to catch up on. The Beatles Box Set is $150.00 on iTunes. It's cool that older generations have been been able to accumulate music for years and years but a child born today (if they appreciate older music) will have to go back and spend thousands to buy music from The Beatles, Led Zeppelin, Tupac, The Ramones, Tom Petty, Daft Punk, The Strokes, and so on. Not to mention, they have to keep up with an ever increasing amount of new music.

I feel like people from older generations are constantly saying, "our music was so much better than this crap." The reality is that they are listening to Bruno Mars new radio hit about Guerrillas or some new Katy Perry song. They've never heard of groups like Tame Impala. I'm not trying to be a music snob, to each his own as far as taste, but the point is that if you are into music today then there is just way too much of it, both built up over time and coming too fast for us to buy everything that is worthwhile.

The thing is, people of a certain age are almost always lacking in disposable funds. When I was growing up, there was a time when a portion of the money I earned, even if it was $5 per week, got earmarked to buy records (then tapes, then cd's). The shift to buying digital, I would argue, has de-valued music overall, because we're not really buying anything but the use of a digital file. The value will keep declining as more people pay (or don't) for streaming music. It's what I hear from my kids all the time - "Why should I buy any music when I can just stream what I like for free?" They're probably the smart ones not wanting to pay for something that they may like this week and not next, but it's definitely reducing the value of music, compared to what people from my generation (or before) felt about it.

 

[Benjamin Frost]

I am tired of all these huge companies (Spotify, Apple Music, Facebook Music, etc etc) climbing over each other in this latest "we must all be streamers!" goldrush. Launching a streaming service is great for those companies, but awful for musicians. You're teaching people that music is something to be streamed for dirt cheap, and the musicians in turn get only like 5% compared to what they would have gotten from album sales. As an example, Avicii's Wake Me Up was one of the top 10 most played songs on Spotify but only earned like $5000 in streaming royalties in a whole year. If you'd had a fraction of the listeners buy it, i.e. 1 million single sales at $0.99, then they would have had $999,999... Does nobody else see a problem with widespread streaming? Rich companies get richer, while musicians are forced on the road to do live shows and sell merchandise as the only viable income, which in turn requires that they're even famous enough to get gigs. Geeze this sucks so much. What's next? Programs that automatically compose music, thus killing music forever? These are sad times...

When you download a song today, Apple pays the owner $0.70 (70% of $0.99). When you stream a song after June 30, Apple pays the owner $0.015. That's 1.5 cents. And that extremely low amount is already 3x higher than what the notoriously cheap Shittify pays. A listener would have to play the song nearly 50 times to make up for what the artist would have earned from a single download.

There was a reason that Taylor Swift decided to go to Apple Music after all: She knows how much the royalties suck and that she'd earn far, far less than direct album sales and that her music is being devalued (and she said so herself). But she has enough money to not *need* album sales anymore. She decided the promotion of being available for streaming on launch day was worth the huge loss in income. But for future up-and-coming musicians, they're going to have a hell of a tough time, since they can no longer expect to sell songs on iTunes. It'll all be streaming for fixed, dirt-cheap prices... And soon we'll see those streaming prices approach zero, as all services eventually do... Good job, huge corporations killing art once again...

Another example is Pharell getting $2700 for 43 million plays of his "Happy" single: http://www.musicbusinessworldwide.com/poor-songwriters-how-hidden-costs-are-butchering-their-income/ - and it shows some math for Spotify which reveals that out of the 9.99 EUR premium membership, only 0.62 EUR ($0.64) make it out to artists for splitting across every song that the member listened to in that month. That's ridiculous!

The only hope is that the companies and congressmen representing artists win this battle. They're lobbying to increase the payments for streaming music. Who cares if people have to pay higher monthly fees? They're set way too low already. Unlimited music for Spotify's $10 a month leaves almost nothing to the artists. Here's the info regarding the ongoing legal battle: http://www.washingtonpost.com/news/...ic-streaming-business-amidst-royalty-dispute/

Spotify is the biggest culprit, for being the sleezeballs that gouged musicians from day 1, and they are solely responsible for the current insanely-low market price for streaming music. Every new service had to match their spit-in-the-face prices...

I guess the *only* good part of Facebook and Apple's entries into the streaming market, is that it will piss off musicians even more and will lead to either a total collapse of indie music, or a reform to proper market values that allow musicians to make a living like they used to be able to before these greedy corporations screwed everything up. If nothing changes, then this is the end of indie music.

I am sure that if nothing changes, musicians will simply refuse to sign streaming agreements. Corporations can't steal the product (the music) without consent. So if lawmakers can't fix this complete rape situation, then musicians will simply reach a point where they all get together and pull their music out. Of course, by that time people may have already been trained to stop paying for music. Every new market has its teething problems, but this is the most ridiculous greed situation in the history of mankind. A new generation of pirating freeloaders combined with a greedy, underpaying industry. This is a recipe for disaster for all musicians, even famous ones (Pharell's $2700 compensation for 43 million streams)... Something will happen, that's for sure.

TL;DR: Corporations, please get your disgusting, greedy d#cks out of musicians' a$$es, thanks. If you're going to train consumers to stop paying for music and start streaming instead, then you must fairly compensate the people making the godd#mn product you're selling! This is insane and can't be allowed to go on!

Great post.

My only criticism is that you're not pessimistic enough. In my opinion, music has already been destroyed by streaming and pirating, YouTube etc. I don't think it's reversible, which means that we have seen the end of good, let alone great, music being made.

It's a sad situation and is a reflection of the mess greedy capitalism and democracy have made of the world today. Firstly, corporations charged far too much for albums. That led to pirating. Then Jobs made songs available at a good price. But now, albums still cost a lot too much in iTunes. This time, corporations are ruining music once again with streaming. And we have no Steve Jobs to save the music industry again.

It's ironic that in a time when we have access to more music than the world has ever known, we live in a time when the quality of new music is at its lowest since man invented the great Western classical canon several hundred years ago.

 

[freshe]

Honestly who gives a ****, I'm staying with Spotify until someone will gives lower price. Don't care about millions of songs, exclusive videos and material as you'd probably have a 1000 favourite songs that you'd listen to anyway. And OMG beats1 these moans by DJs on "here comes the sweet riff etc." or "mixing explicit lyrics to mute them..." is just soo lame

 

[Gary03mw]

I think you're speaking from a very narrow perspective.

A chronological feed makes absolutely no sense for most users. When there are thousands of friends involved, facebook's algorithms help leverage the stories they think will be most interesting to you, and for the most part, it works. Especially for older people who are less tech savvy, people who probably don't log in every day, etc.

But it doesn't work. Instead of me scrolling down my feed and getting to the end like I do on every other network I have to refresh and scroll through FB multiple times (every time getting a seemingly different feed). My issue with this is that I have already done the curation when I accepted or sent a friend request and Facebook is simply overriding that with what their algorithm thinks I want to see. Nothing is more frustrating than a buddy or family member asking why I didn't like their post (because they posted it knowing I would more than likely appreciate it) and my answer is, "oh, I didn't see it" despite the fact that I've scrolled through my feed 5 times that day. The current feed seems to me to be a way to keep people on the site for a longer duration by making the feed less efficient. In that case, yeah, it's probably working for FB but it's not in the interests of users.

Also you seem to contradict yourself here. These "less tech savvy" people aren't the same people with "thousands of friends." I don't have a source but hopefully we can agree that in general the grandmas on Facebook have significantly less "friends" than their grand daughters.

Think about how news is delivered. The NYT doesn't give you a chronological feed of stories as they're written. Everything is curated. And since facebook began curating, more people began clicking on articles and liking articles and sharing better.

No, that's how news used to be delivered. Now, I curate with a twitter feed. If you haven't noticed, newspapers are dying. The NYT specially may hold out for a while because of its legacy, its credibility, and the general quality of their work but the general point you're making here is dated.

The thing is that I can get on Twitter and my news is up to date, it's often from primary sources, and it's curated specifically for me. I don't have to go to Rolling Stones or NMEs website (although i do follow them too) to hear about bands I like because I follow those bands (or band members) directly. I don't have to go to Forbes, or Marketwatch, or Motley Fool individually because I follow them on Twitter as well as people like Warren Buffett and Bill Gates. I don't have to go to IGN or read Game Informer because I follow 343 Studios, Walshy, Ogre 2, etc. You get the point. Sometimes I will want to follow a link in my twitter feed to the site specifically in order to read further but I rarely go directly to the site. Macrumors is similar for me.. I follow them on Twitter and I got involved in this thread through a link on one of their tweets.

The point is that I would never spend so much time today going to a bunch of individual sites to get the news that I wanted. I also wouldn't let a single outlet determine what they think is important to me or their general population of readers. Here's a question for you. Why would I let the NYT tell me their opinion on the past week in baseball when all I want hear about is how the women did in the world cup, and I can specifically hear from people like Abby Wambach directly?

Grouping friends - sure. Messages has helped here a lot. This is where I have groups related to specific events or circles of friends and it's effective. But not all the way there.

I mean messages is nice, but that's not really what I'm getting at. I want to see a great deal of functionality added that makes it simple to share individual things with exactly who you want to share those things with. This is the type of change that would have to go through the core of how the entire experience functions. Until they fix this they have no chance of being the "cool" network again.

Games - you're crazy. Do you know how much money facebook makes here? Do you know how many people use facebook just for the games? I've turned off notifications from candy crush, so my annoyance with the problem is gone. I suggest you do the same if that's what you're looking for.

I have heard that Games, and on a larger scale Apps, are a good revenue driver for FB. Exactly how much, I have no idea. I have blocked a few games but it always seems there is another. It's never ending and for the bulk of users it's just a constant frustration. Perhaps a more universal setting to block all games or something would work? I'm not sure, but I do know that if 95% of your users are frustrated by something then it probably needs to change.

The thing is, people of a certain age are almost always lacking in disposable funds. When I was growing up, there was a time when a portion of the money I earned, even if it was $5 per week, got earmarked to buy records (then tapes, then cd's). The shift to buying digital, I would argue, has de-valued music overall, because we're not really buying anything but the use of a digital file. The value will keep declining as more people pay (or don't) for streaming music. It's what I hear from my kids all the time - "Why should I buy any music when I can just stream what I like for free?" They're probably the smart ones not wanting to pay for something that they may like this week and not next, but it's definitely reducing the value of music, compared to what people from my generation (or before) felt about it.

I agree with your major point that the shift to digital may be a factor in devaluing music. I also agree that young people of all time frames have been lacking in disposable income.

My big point about what has changed is more about the sheer amount of music. If you were a kid in the 60s you might have saved and bought the new Beatles record. You might have gone back and gotten a few Elvis, Buddy Holly, or Chuck Berry records from the 50s. The amount of money necessary to do that isn't even close to the amount of money a kid born today would need to buy the good music that came before him. The sheer amount of good quality music makes this nearly impossible today. And it's not just in the number of songs but in the different genres as well. I mean I honestly wouldn't even know where to start if I was trying to show a teenager good music from the past at this point.

The Beatles are important but so is Daft Punk. Led Zeppelin and Kanye West. Radiohead and Garth Brooks. Eric Clapton and Lauryn Hill. The White Stripes and Oasis. Then not to mention new music is coming extraordinarily fast. The point is that today buying and collecting it all almost seems futile.

 

[Temptin]

Great post.

My only criticism is that you're not pessimistic enough. In my opinion, music has already been destroyed by streaming and pirating, YouTube etc. I don't think it's reversible, which means that we have seen the end of good, let alone great, music being made.

It's a sad situation and is a reflection of the mess greedy capitalism and democracy have made of the world today. Firstly, corporations charged far too much for albums. That led to pirating. Then Jobs made songs available at a good price. But now, albums still cost a lot too much in iTunes. This time, corporations are ruining music once again with streaming. And we have no Steve Jobs to save the music industry again.

It's ironic that in a time when we have access to more music than the world has ever known, we live in a time when the quality of new music is at its lowest since man invented the great Western classical canon several hundred years ago.

Indeed! Every paid service is seeing a huge hit from Generation Freeloader. Movies (hit by piracy), tv shows (hit by piracy), cable channels (hit by YouTube and piracy), music (hit by piracy and free streaming), mobile software (hit by jailbreaking piracy), desktop software (hit by piracy).

We live in the most affluent time in the history of mankind and kids steal everything. It's a fu#king joke... They truly are pathetic. And the worst part is that while they are stealing they're often chanting things like "all music should be free!" - which suggests to me they're stuck in a mental Narnia where musicians, authors and creators don't have mortgages and bills to pay and families to feed.

Worse yet: There are always talentless creators willing to work for free and who join in with the frenzied masses by giving their junk out for free to seem cool with the kids. They sell out their artform and brethren for some cheap and fleeting PR. Everyone (especially blogs and young "new media") then points to those losers as role models for how it's "meant to be done."

Art is dying and Generation Freeloader is to blame.

There will always be art, of course, and passionate people will make art even if they no longer make a living from it (and have to waste 8 hours of their potential a day at a regular job). But this is still a huge loss to humanity. What is life without great art and entertainment and music and movies? Less magical, that's what...

What happens to the supply of willing musicians when the prize is an endless slog through medium-size concerts at $25 a head?

We have yet to figure out how to make IP work in the new era. Even if we don't, people will still make pictures, sing songs, and write stories -- just not as frequently, or as lavishly. The popular arts may come to look more like the rest of the Internet: many mediocre labors of love produced quickly and cheaply in spare moments, and very few high-end productions that can be monetized.

 

[joejoejoe]

That is completely correct. It started softly, with artists sharing their music on YouTube for free in return for promotion which in turn lead to iTunes sales (you can link your video to stores so that listeners can buy the album). It worked well.

Then Spotify came along and slowly grew to the point where listeners started expecting free, ad-supported music. Spotify was still a fringe market, but it had tens of millions of listeners and did enough damage (to the direct-sale market) to cause many artists to try streaming their music there. Everybody noticed they were getting almost zero revenue compared to when they used to sell the music.

Musicians saw less and less direct album sales and worried that streaming would just continue to grow and kill their ability to make a living. Hence the advice that started being passed around: "Use streaming and YouTube as promotion, and make your salary from live shows and merchandise at your tours and website."

And then... streaming grew even more and Apple jumped into the fray, and indie artists were scared to death when they realized that the shift from downloads to streaming is truly coming at full force now. To say that artists are panicking is an understatement. Everybody is seeing huge losses of income, and that's what has prompted congressmen and music industry people to try to get some laws passed that value music again. Meanwhile, the streaming companies are fighting against having to share more revenue. So there is a war ramping up. These are interesting times.

Many artists are unable to do live shows but used to make a living from sales. Those people are the majority of indie musicians and they are getting totally screwed.

Pretty much every artist out there has considered just dropping all streaming and doing regular iTunes and direct sales from their website, but that's incredily risky since direct sales are a rapidly dying market thanks to streaming re-training people to the idea of having a "pick your own songs" radio station at all times.

My prediction is that direct sales will completely vanish within 5 years, with only a few fringe audiophiles still buying music (for lossless quality audio downloads). Everyone else will enjoy the greater convenience that streaming enabled.

As for revenues from streaming, there are 3 possibilities:
* Laws are passed, valuing music higher again. That would allow musicians to make a living from streaming, the way they used to make a living from sales.
* Streaming prices stay the same, thus killing off many new, small musicians who have to get regular jobs and can't devote their time to music instead. And no, they can't just join a big label; those glory days are over too. Major labels don't pay much anymore, thanks to the overall decline in music sales.
* Or, musicians are finally fed up and boycott streaming until the companies change. This scenario is actually quite likely, if things continue going downhill. Right now, streaming companies are practically stealing the music for free, and musicians are understandably very upset that fat corporations are taking the revenue from their work.

So yes, merchandise and concerts are the only serious remaining sources of income. But if streaming services simply doubled their prices ($20 a month for unlimited access to music is still dirt cheap; in the past you only got 2 albums for that price), and directed more of the share to the musicians (a 70/30 split), then this would all be a non-issue and all musicians would love to stream everything.

The issue isn't streaming. It's these greedy corporations stealing from the musicians. I hope the various law proposals go through, so that we put an end to this insanity. Either way, the battle has just begun, and I don't think the musicians will just continue bending over forever. An entire artform is threatened to the core by greedy corporations. These are interesting times...

THANK YOU

this is so informative!

sad, but informative.

 

[Gary03mw]

Great post.

My only criticism is that you're not pessimistic enough. In my opinion, music has already been destroyed by streaming and pirating, YouTube etc. I don't think it's reversible, which means that we have seen the end of good, let alone great, music being made.

It's a sad situation and is a reflection of the mess greedy capitalism and democracy have made of the world today. Firstly, corporations charged far too much for albums. That led to pirating. Then Jobs made songs available at a good price. But now, albums still cost a lot too much in iTunes. This time, corporations are ruining music once again with streaming. And we have no Steve Jobs to save the music industry again.

It's ironic that in a time when we have access to more music than the world has ever known, we live in a time when the quality of new music is at its lowest since man invented the great Western classical canon several hundred years ago.

People are nostalgic. Good music is far from dead. If you haven't, go listen to Daft Punks Random Access Memories or Vampire Weekends Modern Vampires of the City. Both came out in 2013 and they're both modern classics. Some other albums of the past few years that are really great:

Phoenix- Wolfgang Amadeus Phoenix (2008)
HAIM- Days are Gone (2013)
Arctic Monkeys- AM (2013)
Kendrick Lamar- Good Kid, M.A.A.D City (2012)
La Roux- La Roux (2009)

There are many, many, more but those are just a few of my personal favorites.

 

[Gary03mw]

Indeed! Every paid service is seeing a huge hit from Generation Freeloader. Movies (hit by piracy), tv shows (hit by piracy), cable channels (hit by YouTube and piracy), music (hit by piracy and free streaming), mobile software (hit by jailbreaking piracy), desktop software (hit by piracy).

We live in the most affluent time in the history of mankind and kids steal everything. It's a fu#king joke... They truly are pathetic. And the worst part is that while they are stealing they're often chanting things like "all music should be free!" - which suggests to me they're stuck in a mental Narnia where musicians, authors and creators don't have mortgages and bills to pay and families to feed.

Worse yet: There are always talentless creators willing to work for free and who join in with the frenzied masses by giving their junk out for free to seem cool with the kids. They sell out their artform and brethren for some cheap and fleeting PR. Everyone (especially blogs and young "new media") then points to those losers as role models for how it's "meant to be done."

Art is dying and Generation Freeloader is to blame.

There will always be art, of course, and passionate people will make art even if they no longer make a living from it (and have to waste 8 hours of their potential a day at a regular job). But this is still a huge loss to humanity. What is life without great art and entertainment and music and movies? Less magical, that's what...

What happens to the supply of willing musicians when the prize is an endless slog through medium-size concerts at $25 a head?

We have yet to figure out how to make IP work in the new era. Even if we don't, people will still make pictures, sing songs, and write stories -- just not as frequently, or as lavishly. The popular arts may come to look more like the rest of the Internet: many mediocre labors of love produced quickly and cheaply in spare moments, and very few high-end productions that can be monetized.

The thing is that you're wrong on the point of great art going away. To the contrary, it's being exposed in ways that it never was before. Artists no longer have to get "discovered" by the right person and listeners are no longer subject to the limitations of radio play. The Weeknds House of Balloons is a fantastic example of what I'm talking about.

To be clear, I'm not advocating the stealing of music, or any art for that matter, but the reality is that there is plenty of incentive to make high quality music today (and even in worse times when piracy ran rampant before iTunes).

 

[sir1963nz]

Ugh, that social network needs to die already.

It is dying.
I use Facebook to help keep in contact with friends/family all over the world. However I have noticed that Facebook is becoming more and more :
Reposted internet memes (Cats, Quotations, Recipes, etc)
Adverts (either as ads or Facebook generated "Your friend liked this page")

Less and less personal information is being put onto Facebook , fewer comments about what they are up to, fewer photos, etc that Facebook can use or sell to advertisers.

Facebook is desperately trying not to go the same way as myspace etc, it will, it will simply take longer.

 

[SteveW928]

I just wish they'd get their core functionality working better before heading off into other areas (seems to be a trend with companies lately). Their comment/community system has to be one of the worst out there... which you'd think would be a key aspect of their service (I guess millions use it everyday despite how bad it is... sheesh). Heck, just go back and buy some code from a late 90s BBS system and it would be much better.