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Warner Music Remains Optimistic on Streaming Music, as Long as It's Paid

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Apr 12, 2001
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Amid the explosion in popularity of streaming music services, Warner Music Group continues to support the concept, as long as subscribers are paying for the music to which they are listening, reports Re/code. Warner's CEO Stephen Cooper spoke about the company's growing interest in streaming music during the company's latest earnings conference call which was held last week.

Streaming music is increasingly important to Warner, with revenue from online music up 74 percent year over year. In the same period, revenue from downloads plummeted 12 percent, echoing a similar downward trend also seen by Apple's iTunes music download service.

To offset the loss from downloads, Warner currently accepts the freemium model of ad-supported streaming music, but only as a means to convert users to paying subscribers. Paid subscriptions and not freemium plans are the future of the industry, states Cooper.
In our view, right now, enabling meaningful global growth in the number of paying subscribers is the best option for artists, for songwriters, for copyright owners and for the services themselves. Subscription streaming is not only a fantastic offering for music fans, it will propel the long-term health of the music industry. We look forward to continuing to work closely with our partners to turbo-charge the adoption rate for subscription streaming.
Warner's emphasis on paying subscribers may not bode well for Apple's reported plan of slashing monthly costs for its Beats Music service. The Cupertino company is rumored to be pushing music labels to cut current subscription prices in half to $5 per month as it negotiates the terms for its recently acquired Beats Music streaming service. Apple argues that lowering the monthly cost will encourage significantly more users to sign up for the paid service, but labels are obviously considering whether those gains will outweigh the lower per-user income that comes with the cheaper pricing.

Along with a goal of lowering consumer pricing, Apple is also said to be working on an early 2015 refresh for the Beats service, likely integrating it into the iTunes brand. With iTunes Radio and Beats Music, Apple offers both ad-supported and paid streaming service, although the two are not currently integrated. iTunes Radio is currently tied to Apple's traditional download offerings, offering easy access for users to purchase individual tracks they hear on iTunes Radio. Even so, iTunes Radio has seen a tepid reception and international expansion has been extremely slow with the service available only in the United States and Australia.

Article Link: Warner Music Remains Optimistic on Streaming Music, as Long as It's Paid
 

gigapocket1

macrumors 68000
Mar 15, 2009
1,814
1,114
Hoping for the $5 plan!
Currently on beats family plan thru att. $15 with 4 accounts. Not a bad deal at all!
 
Comment

J. Jizzle

macrumors regular
Mar 30, 2013
225
73
U.S.A.
I've never understood why people would pay to stream music. Just put your music collection in iTunes and synch to your iPhone or Google Music on Android. May be a little time consuming, but it's free and you get to listen to what you actually want to hear.
 
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2457282

Suspended
Dec 6, 2012
3,327
3,014
Personally, I like to own my own stuff and still purchase and download. My wife goes back and forth between Spotify and my music library, but hates having to wade through my 14,000 songs.

I think that streaming could work if --
1. Better options for selecting music; I still find that it plays a lot of junk for me.
2. Better options for listening when not connected to Wi-Fi.
3. Reasonable prices.
4. Protects the artist - if they don't make money, they can't create the product we want to hear.

None of the options out there seems to do this right now.
 
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69Mustang

macrumors 604
Jan 7, 2014
7,664
14,502
In between a rock and a hard place
Hoping for the $5 plan!
Currently on beats family plan thru att. $15 with 4 accounts. Not a bad deal at all!

Confused a little. Why would you hope for the $5 plan? What you have now is better. $3.75 v. $5.

----------

I've never understood why people would pay to stream music. Just put your music collection in iTunes and synch to your iPhone or Google Music on Android. May be a little time consuming, but it's free and you get to listen to what you actually want to hear.

I think for a lot of people music is something they like, not love. So they have no visceral connection to the music. I'm in that category. I have no desire to own the music. Songs are played a lot when new and then I move on. If I really like something, I can buy it as well. On those occasions when I want to hear something from the past that I didn't buy, I pull it up, listen to it, and move on. For those who love music more it may be different.
 
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usersince86

macrumors 6502
Oct 24, 2002
377
750
Columbus, Ohio
Paying for streaming is fair and makes sense. It's how radio has always worked. Otherwise, the authors (and/or artists) lose out completely.

It doesn't mean the end-user (consumer) has to pay -- ads can do that (again, always have). But someone needs to.
 
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bushido

Suspended
Mar 26, 2008
8,070
2,754
Germany
I've never understood why people would pay to stream music. Just put your music collection in iTunes and synch to your iPhone or Google Music on Android. May be a little time consuming, but it's free and you get to listen to what you actually want to hear.

assuming one pays for CDs to put them into your iTunes to sync (which I don't) plus I don't always know what I want to listen to. Spotify has everything I can think of and ready to play playlist so I don't have to do it myself. u also discover artists or see albums u had no idea where already released
 
Comment

roadbloc

macrumors G3
Aug 24, 2009
8,784
213
UK
I'd rather give my money to the artists directly than support greedy music labels on the way. Go **** yourselves Warner Music.
 
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lord patton

macrumors 65816
Jun 6, 2005
1,051
4
Chicago
"Free" now with Amazon prime. Soon it will be free with your Lexus, netflix, t-mobile, or come in your box of crackerjacks. Songwriters are screwed and it will never get better.
 
Comment
Of course the labels want us to rent-to-play. That has a potentially endless revenue tail tied to it.

Here's the problem: until we got to the ripping stage, there was a regular re-buy model. Vinyl & Cassettes wore out. CDs solved much of the problem of wearing out and ripping from CDs meant you had a pristine copy of your music for up to forever. Music ripped from CDs I bought way back in the 1980s still sound exactly as good as they sounded when played the first time.

Then you have the generational problem. Kiddies grow up and leave the nest. They might like some of their parent's music. In the past, it was either take some of it with them or buy new copies of the same music. Digital copies meant the music could both go and stay- no obvious need to buy anew.

Then you have the singles problem. The music industry originally revolved around the single. But there was a golden period where one just about had to buy a whole CD to get the 1-2 good songs they actually wanted. iTunes and similar brought back the ability to buy just the good songs.

Then you have the used market problem. Used CDs that are playable will play the music as good as new CDs. So one could either lay out the $XX for a new CD or maybe 10%-20% of the new price for a used copy. End result is exactly the same. However, reselling a CD doesn't show as new revenue for the Music Studios.

Basically, digital (CD's) ended much of the natural push to re-buy. And once you have enough favorites in your own library of owned music, you can shuffle to keep the ears pretty stimulated with favorites.

Renting is usually spun in support for new music discovery but I suspect the ability to play 90 seconds of any song in iTunes, availability of music videos, classic (free) radio, online (free) radio, VH1 & MTV, etc offers much of that same benefit without the subscription fee. The problem may not be that people don't want to buy (or re-buy) new music (that will show as music studio revenues); the problem is probably that either the market has accumulated much of the music it wants and/or it has a multitude of cheaper ways to get new music it doesn't own vs. buying a new CD or a new digital download.

In my own experience, when I discover a new song I'd like to have, I check digital sources like iTunes (where it will usually be $1.29). Then, I'll check used CD prices and find that I can get that song plus other "best of" in collections like the "Now that what I call music" or similar or in "greatest hits" anthology (along with a number of other good songs) for close to that or maybe a few dollars more. Unless I spend the $1.29 or buy a brand new CD, the studio gets no new revenue even though I end up with the same net result. So they gripe about declining music sales but music still sells- just not in ways that show in their revenues.

Personally, I just don't see streaming as the salvation. If it's ad-driven, there's free radio that is ad driven (not $10/month and not $5/month). Instead, I think iTunes and similar largely got it right with the single purchase model. The problem is that now a lot of music buyers probably have a lot of the music they want to own. It will be pristine forever so they won't wear out that music by enjoying it.

If the studios want to grow revenues, what is needed is a lot of brand new music that the masses deem "must have". With somewhat rare exception, I still find myself favoring "oldies" over modern music. Give me some new music that sounds as good as the old stuff and I'm interested. Otherwise, I already have lots of great music synched to my iDevices: shuffle play, no commercials, $0/month.
 
Comment

840quadra

Moderator
Staff member
Feb 1, 2005
8,234
3,535
Twin Cities Minnesota
There are some ads, but I still prefer the classic free streaming radio stations. Though, I like Electronic music, so stations like ETN, 1FM and such have plenty of new stuff, that keeps me interested in purchasing a set from time to time.

iTunes radio is the only subscriber based streaming service I pay for. That said, It is only a perk for me, as I am actually paying for iTunes Match, not for the radio service.
 
Comment

taptic

macrumors 65816
Dec 5, 2012
1,338
437
California
Of course the labels want us to rent-to-play. That has a potentially endless revenue tail tied to it.

Here's the problem: until we got to the ripping stage, there was a regular re-buy model. Vinyl & Cassettes wore out. CDs solved much of the problem of wearing out and ripping from CDs meant you had a pristine copy of your music for up to forever. Music ripped from CDs I bought way back in the 1980s still sound exactly as good as they sounded when played the first time.

Then you have the generational problem. Kiddies grow up and leave the nest. They might like some of their parent's music. In the past, it was either take some of it with them or buy new copies of the same music. Digital copies meant the music could both go and stay- no obvious need to buy anew.

Then you have the singles problem. The music industry originally revolved around the single. But there was a golden period where one just about had to buy a whole CD to get the 1-2 good songs they actually wanted. iTunes and similar brought back the ability to buy just the good songs.

Then you have the used market problem. Used CDs that are playable will play the music as good as new CDs. So one could either lay out the $XX for a new CD or maybe 10%-20% of the new price for a used copy. End result is exactly the same. However, reselling a CD doesn't show as new revenue for the Music Studios.

Basically, digital (CD's) ended much of the natural push to re-buy. And once you have enough favorites in your own library of owned music, you can shuffle to keep the ears pretty stimulated with favorites.

Renting is usually spun in support for new music discovery but I suspect the ability to play 90 seconds of any song in iTunes, availability of music videos, classic (free) radio, online (free) radio, VH1 & MTV, etc offers much of that same benefit without the subscription fee. The problem may not be that people don't want to buy (or re-buy) new music (that will show as music studio revenues); the problem is probably that either the market has accumulated much of the music it wants and/or it has a multitude of cheaper ways to get new music it doesn't own vs. buying a new CD or a new digital download.

In my own experience, when I discover a new song I'd like to have, I check digital sources like iTunes (where it will usually be $1.29). Then, I'll check used CD prices and find that I can get that song plus other "best of" in collections like the "Now that what I call music" or similar or in "greatest hits" anthology (along with a number of other good songs) for close to that or maybe a few dollars more. Unless I spend the $1.29 or buy a brand new CD, the studio gets no new revenue even though I end up with the same net result. So they gripe about declining music sales but music still sells- just not in ways that show in their revenues.

Personally, I just don't see streaming as the salvation. If it's ad-driven, there's free radio that is ad driven (not $10/month and not $5/month). Instead, I think iTunes and similar largely got it right with the single purchase model. The problem is that now a lot of music buyers probably have a lot of the music they want to own. It will be pristine forever so they won't wear out that music by enjoying it.

If the studios want to grow revenues, what is needed is a lot of brand new music that the masses deem "must have". With somewhat rare exception, I still find myself favoring "oldies" over modern music. Give me some new music that sounds as good as the old stuff and I'm interested. Otherwise, I already have lots of great music synched to my iDevices: shuffle play, no commercials, $0/month.

Um....

 
Comment

avanpelt

macrumors 68030
Jun 2, 2010
2,937
3,838
I've never understood why people would pay to stream music.

There's a lot of music out there that I would like to listen to but I don't love the music enough to actually buy the song and own it forever. Discovering new music with Spotify is one of the things I really enjoy doing. Unlike Pandora or iTunes Radio, with Spotify, I can quickly skim all the tracks on an album to find a few that I want to listen to. If I really like the songs, I can add them to my library on Spotify and download them to my device so I don't consume cellular data unnecessarily when not on Wi-Fi.

If you're only going to listen to a handful of new songs each month and you keep listening to the same songs over and over again then no, Spotify doesn't make much sense to use.

However, at $10/month, as long as I listen to at least 10 songs I don't own each month (and I probably listen to close to 10 times that amount of new music each month), Spotify and other similar services are outstanding deals for the consumer. If I bought all the music I listen to on Spotify, I'd easily be spending 10 times the amount that I pay Spotify each month.
 
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gadgetguy03

macrumors regular
Nov 1, 2012
223
143
To offset the loss from downloads, Warner currently accepts the freemium model of ad-supported streaming music, but only as a means to convert users to paying subscribers. Paid subscriptions and not freemium plans are the future of the industry, states Cooper.

Well therein lies the problem for me. I don't love the music enough to justify spending the monthly subscription fee. I had Spotify Premium for several months but when it came to trimming the budget it was one of the first things to go. I have several great radio stations here in Kansas City, MO and I haven't had any issues with ad-supported iTunes Radio or Pandora if those aren't playing what I'm looking for. Personally I'd rather spend my $9.99 on a really good album I like on iTunes. I know others out there might not feel the same.
 
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Paradoxally

macrumors 68000
Feb 4, 2011
1,684
2,180
I will never support Spotify with my money. They claim they give 70% of revenue back to artists/songwriters/musicians, but this is just marketing propaganda to make you feel good.

http://thetrichordist.com/2014/11/0...s-to-artists-isnt-that-fair-no-and-heres-why/

For big artists, they don't care (mostly, yet some have taken their music entirely off streaming playoffs, which I totally support). They earn millions with tours, album sales and merchandise. However, not everyone is Taylor Swift or Beyoncé. The biggest indie stream was paid 3k from Spotify. That's nothing!

If you want to support artists, especially indie or lesser known ones, buy their music and go to their shows. Don't stream it from Spotify. It's not a sustainable business model for anyone in the music industry that hasn't a big label behind them.
 
Comment

NY Guitarist

macrumors 65816
Mar 21, 2011
1,228
786
Seems like this is just another corporate race to the bottom at the expense of the artists, who can least afford it.
 
Comment

garya73

macrumors 6502
May 12, 2013
282
71
Delaware, USA
Album sales mostly benefit the labels. Musicians make most of their money from touring and merchandise sales.

So of course a big label like Warner wants to promote a subscription model. They are going to make more money that way then with free or freemium models.

I try to support smaller artists and go to their shows and buy merchandise and CDs there. Though then again, how much of the money you pay to get in actually goes to the artist, and not to the venue. You know the ticket broker is getting paid, they always list their fee separately. But $4+ for one ticket is just outrageous when it is all done electronically and you print your own ticket at home.

Thankfully the internet and sites that promote indie or unsigned artists exist. And any band or person can create their own site and distribute their own music. Cut the labels completely out of the equation (or at least minimize the amount of money they take from the artists).
 
Comment

Nunyabinez

macrumors 68000
Apr 27, 2010
1,758
2,230
Provo, UT
I think there are probably just as many people out there who would say that they don't understand why anyone would buy something that might sit for years unused. I can certainly see both sides.

I think a big part of it has to do with the way you consume music. I have never been a fan of the radio. When I was a kid I had an 8 track player in my car and then a cassette deck and then a CD deck because I want to listen to an artist and album rather than individual songs.

And I'm pretty impatient with music I don't like, so the radio isn't for me. I know streaming gives you more control, but for example, when I set-up an iTunes Radio station, it ended up just playing stuff already in my library, which would be OK, but sometimes I'm not in the mood for something, even though I own it.

But, there are plenty of people out there that just want some background music and don't really care that much about which artists or songs are played within some boundaries, and for them, streaming is great.

I wouldn't count streaming out, it is likely the way everything will go eventually. And technically, since I use iTunes match, I steam much of my content anyway, I just happen to stream what I purchased already. The lines will become more and more blurry with time.
 
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avanpelt

macrumors 68030
Jun 2, 2010
2,937
3,838
Seems like this is just another corporate race to the bottom at the expense of the artists, who can least afford it.

It's not like the successful artists aren't able to still make a lot of money. They are. It's called doing concerts and selling merchandise. The internet has changed a lot of industries...of which music is only one.

The smart people in any industry are the people who embrace the technology and change with it to find other/additional avenues for making money. If they don't do that, they're going to be in trouble because based on its present trajectory, the technology isn't a fad that they're going to be able to "wait out".
 
Comment

alexgowers

macrumors 65816
Jun 3, 2012
1,336
890
I see future streaming being along the lines of radio, played for free first then to hear again or later on after a month or so you need to be subscribed in some way to get that music on demand.

like a bbc iplayer type deal, plenty of room for sales to fans. The ad supported model is just not gonna cut it on it's own and warner is aware of that.
 
Comment

Nunyabinez

macrumors 68000
Apr 27, 2010
1,758
2,230
Provo, UT
Album sales mostly benefit the labels. Musicians make most of their money from touring and merchandise sales.

So of course a big label like Warner wants to promote a subscription model. They are going to make more money that way then with free or freemium models.

I try to support smaller artists and go to their shows and buy merchandise and CDs there. Though then again, how much of the money you pay to get in actually goes to the artist, and not to the venue. You know the ticket broker is getting paid, they always list their fee separately. But $4+ for one ticket is just outrageous when it is all done electronically and you print your own ticket at home.

Thankfully the internet and sites that promote indie or unsigned artists exist. And any band or person can create their own site and distribute their own music. Cut the labels completely out of the equation (or at least minimize the amount of money they take from the artists).

This. If you think your iTunes purchase (or CD) is putting food on an artist's table you don't understand how the music industry works.

If you really care about artists, go to their website and buy some merchandise or attend a show.
 
Comment

skinned66

macrumors 65816
Feb 11, 2011
1,358
1,218
Ottawa, Canada
Paid subscriptions and not freemium plans are the future of the industry, states Cooper.

Says you. I can't think of a single act on the Warner label I'd listen to for free. I'll be voting with my wallet and not giving any of you goofs subscription money.

I'll go to shows and buy stuff direct.
 
Comment

cmwade77

macrumors 65816
Nov 18, 2008
1,062
1,177
I've never understood why people would pay to stream music. Just put your music collection in iTunes and synch to your iPhone or Google Music on Android. May be a little time consuming, but it's free and you get to listen to what you actually want to hear.

Or buy all your music from Amazon and have it automatically added to your Amazon account and stream all you want from there.

----------

This. If you think your iTunes purchase (or CD) is putting food on an artist's table you don't understand how the music industry works.

If you really care about artists, go to their website and buy some merchandise or attend a show.

Actually, if an artist is self publishing (which is a lot easier now with eMusic, iTunes, Amazon Music, etc.), then buying their Album does put food on their table. But if they are published by a record label, then it won't.
 
Comment

LethalWolfe

macrumors G3
Jan 11, 2002
9,368
119
Los Angeles
I like Pandora and Spotify because it helps me find bands I might not have found otherwise and I typically end up buying albums from those bands.

If you really care about artists, go to their website and buy some merchandise or attend a show.

Shows have their own set of expenses (which can easily eclipse the cost of creating an album).

This Band Just Finished A 28-Day Tour, Made Over $100K In Ticket Sales, And Took Home How Much?

Album sales impact leverage when bands are negotiating deals. The more album sales, especially during the initial release, the more leverage the band has for future negotiations, so if you really care about artists buy their albums, go to the shows and pick up a t-shirt.
 
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