While artists advocates complain about low payouts from streaming services like Spotify, Evolver.fm's Eliot Van Buskirk makes that point that such services may in fact be doing something far more important: helping to improve our shared musical culture.
Here's his argument: The economics of the music business of the past rewarded labels and artists when a record was purchased. Getting the customer to lay down the cash at the record store or the iTunes store was all that mattered. Whether that record became a lifelong favorite of the purchaser -- or they listened to it once and never again -- didn't matter. This reality incentivized the creation of "one-hit-wonders capable of moving product quickly."
But music consumption is moving away from the "upfront payment" of purchasing product, and towards "pay as you use" streaming services (Spotify, YouTube, Pandora, MOG, iHeartRadio, Rdio, Rhapsody). In this world, copyright owners and artists will earn not by creating a product that convinces a listener to take a one-time action (make the purchase), but by creating art that the listener wants to enjoy again and again.
"It’s no longer enough to convince fans to buy a disc once," writes Van Buskirk. "Instead, artists and labels have to turn them into lifelong fans."
More from Van Buskirk: "This new phase of music consumption...is just what music fans who are sick of one-hit wonders and flashy pop hits need. By paying out only when people actually listen instead of suckering fans into buying something only to leave it on the shelf... on-demand unlimited music services build an incentive into the music business to create works of lasting value."
As we've argued the Internet may usher in a new golden age of radio, Van Buskirk wistfully hopes for a return to a time "when labels used to spend years or decades developing an artist instead of releasing whatever they think will sell that week."
Read Van Buskirk in Evolver.fm here.