Navigating the world of streaming platforms in 2022
While platforms like Spotify and SoundCloud reign supreme in the music streaming world, with Spotify having over 365 million active monthly users, many smaller companies are taking action to offer artists a more transparent and fair way to make money on their platform. As of December 2020, Spotify's current pay per stream sits at $0.00437 per stream, making it nearly impossible (aside from big artists) to make considerable money for their work. However, smaller companies such as Resonate and Deezer offer a much greater deal for artists that choose to use them by innovating the traditional pay-per-stream model and shifting to newer, more innovative methods.

To understand streaming, we must first understand an artist's digital rights and revenues - which can be difficult, as this category is still fairly chaotic and hard to manage with ever-changing technology. In the digital format, two copyrights are involved: the copyright of the song, and the copyright of the physical sound recording. Additionally, for interactive streaming, two types of licenses are involved, which are public performance (as a 'stream' of a song and sound recording counts as such), and mechanical (this traditionally accounts for the physicality of the song, which has transitioned from discs to downloads). This is essential knowledge, as it sets the framework for the money flow in a digital stream.
Resonate, a Berlin-based company hopes to alleviate the current challenges artists face in the digital world, by shifting the focus from access to ownership, placing more value on downloads than single streams. In contrast to the traditional interactive streaming model, which essentially allows users to pick and choose which songs they want to hear - paying artists a fraction of a penny, Resonate has a different idea entirely.

With Resonate's "Stream-2-Own" model, the cost of a digital download is split into nine separate theoretical plays, making the artist gain money on a pay-per-stream model (counting for public performance), and on their downloads as well (accounting for mechanical royalties - which still make up 52% of all digital revenues according to the IFPI).

Cherie Hu briefly describes how it works in her Forbes article, stating that "users streaming a song on Resonate for the first time will pay 0.002 cents for the play; the second play will cost them 0.004 cents; the next play 0.008 cents, and so on until the ninth play, after which they fully own the song for a total cost of 1.016 dollars."

This model not only increases the monetary worth of a song compared to Spotify's $0.00437 per stream, but provides a much stronger sense of ownership to artists, as it promotes downloading to users, and rewards artists for recurring listeners. Resonate prides itself in being the first of its kind, as an ethical music-streaming co-op, and aims to rediscover music as art made by real humans, rather than "audio wallpaper." Resonate also has a unique profit calculator for artists to use on their site, as well as a global community of artists, DJs, and creators to connect with.
"For artists, this means owning their work and owning their networks. Resonate is about fairness and control; we allow creators to set the terms on which to distribute their art."
Similarly, the French company and application Deezer has a relatively new take on artists' ownership rights and has created many innovative techniques to ensure these rights. UCPS, or user-centric payment system, is Deezer's way of ensuring that listeners' money only goes to the artists they chose to stream.

Namely, instead of your subscription money being distributed among the Top 40 songs, which is currently what occurs under the 'big pool' model used by most streaming platforms, Deezer distributes it directly to your streamed artists. This model tackles many types of streaming fraud, wherein the overall market is manipulated to award money to bots, as well as many other discrepancies within the mainstream model.

As pointed out by Deezer and Resonate, the current model leads to slow, inaccurate royalty payouts, and needs to be changed for a more just system — where artists finally have a say in how their music is distributed, and listeners alike have a say in how their data is used. Resonate's take on the pay-per-stream model allows for a new way for artists to ensure their music is in the right hands. And similarly, by inventing the UCPS model, Deezer stands behind their mission, and #paywhoyouplay motto within the music streaming industry.

Obviously, the digital streaming industry is extremely complex, and many things must be taken into account in analyzing it. Namely, as I mentioned, the differing types of streaming payouts within the music industry — mechanicals and public performances, which allocate money to the songwriters and publishers for the right to reproduce or 'perform' a given song.

Lastly, we should recognize the recording owners' payment, which is the largest sum of payments under streaming - distributed to the owners of the copyright on the recording end through labels, distributors, etc. Dmitry Pastukhov shared in his 2019 article for Soundcharts, if someone asks how much Spotify pays artists, "99% of the time it will be the payout to recording owners."

While this process leads to a fuzzy image for artists of how much they should be paid, companies like Resonate and Deezer attempting to alleviate problems associated with the pay-per-stream model are already miles ahead in terms of their benefits for artists. Both Deezer's UCPS system and Resonate's unique pay-per-stream system ensure that artists are validated for their contributions to the streaming industry, and listeners are finally paying for music they actually listen to.

In my eyes, many other platforms and apps in the industry have yet to catch up with the modern artists' needs and should take inspiration from innovations created by Deezer and Resonate.

Apart from streaming, other apps are undoubtedly still useful to artists, and each for different reasons. To make things a bit simpler, I decided to categorize a few modern-day streaming and music platforms into different categories to better understand their benefits for artists, as well as their downfalls.
Four Categories of Modern Music Platforms

First, there are the promoters. I would include platforms like SoundCloud and AudioMack in this category. Most of these platforms are not ones that artists are using to make considerable money, and rather a hub for their discography to gain traction. With SoundCloud, artists can get a "55% net revenue share for songs they upload" - but this is mostly through advertisements and not through a pay-per-stream or pay per download model, according to Tamar Salondagit in his 2021 Times article.

Then, there are the connectors, consisting of many up-and-coming applications such as Splice, DISCO, Wave, MIXhalo. Many of these platforms are relatively new and all possess their own unique innovations within the music industry. Splice is a cloud-based music creation and collaboration platform.

Splice's main appeal is that it offers a wide library of sample audio and plug-ins for users on a subscription basis. Similarly, DISCO is a music managing app that allows collaboration between supervisors, rights holders, management, artists and composers, and more. TIDAL is a particularly impressive streaming service, priding itself on high-quality sound and offering audio experiences through technology such as Dolby Atmos. They also combine music streaming, podcasts, and music videos all in one place.

MIXhalo is a real-time audio platform that delivers an immersive experience for live events including concerts, conferences, festivals, sporting events, and anywhere people gather to hear content. Similarly, Wave is a relatively new virtual entertainment platform that enables artists and audiences to collaborate for interactive live performances. All of these different platforms allow for creativity, innovation, and connections within the music industry at large.

Next, there are the supporters. Apps in this category consist of ones such as Resonate, Deezer, Napster, and Stationhead, which go out of their way to create a fair environment for artists to share their music, and pride themselves on transparency for artists and proper money allocation.

Lastly, there are the stakeholders. This category consists of leading platforms in the streaming industry such as Spotify, Pandora, Apple Music, etc. These are the most popular apps to use for music streaming currently but offer little to no money for artists who are just starting their careers. Namely, an artist on Spotify would have to receive over 12,000 streams before they make even $50.

So, what is the takeaway? Should artists boycott apps like Spotify and Apple Music altogether?

Of course not. These apps are at the forefront of the music streaming industry and are an essential factor for an artist's work to be recognized by the masses. For artists in 2022 and the near future, I would recommend distributing your music across many different platforms, rather than relying on just one or two. In fact, to maximize exposure, put your work on as many streaming platforms as possible - and, preferably, a mix of different types of apps (some 'promoters,' some 'connectors,' and some 'stakeholders'). This way, you are getting maximum profit, maximum publicity, and you are also able to weigh the benefits of each platform on your own terms.
Anna Kuelling is a Composium Ambassador who is currently expanding her knowledge of film music by studying Music Supervision at UCLA.
Made on