Artists – take our survey and get a free MIDiA report

With 2022 coming to a close, and Spotify’s Wrapped just around the corner, artists are beginning to look back across the year at how they performed and what they have achieved, and whether it lines up with their hopes for the coming year. If you are one of these artists, we would love to hear from you. MIDiA has launched a new artist survey, designed to take the pulse of artists and their careers. You can complete the survey by following this link.

In the survey, you will be asked about topics such as:

  • How streaming is working out for you
  • What sort of career you are pursuing
  • What tools you use, such as distributor platforms
  • How you feel about navigating today’s streaming-centred music business

All respondents to the survey will get a free copy of our report, Music creator survey, Redefining success, which presents the findings of our most recent major global survey of artists. This will give you a benchmark to monitor how your career is shaping up against other artists, and allow you to compare your aspirations and approaches with theirs.

The coming long-tail cull

When governments plan to introduce controversial new policies, they prepare the ground in advance (dropping hints in speeches, privately briefing journalists, etc.), so that by the time the new policy finally arrives, it does not feel quite so controversial. A similar process is currently playing out in the music business. The biggest major label executives are starting to seed a narrative into the marketplace about the potentially corrosive effect that the rapidly-growing long-tail of music and creators is having on consumers’ music-streaming experiences. Of course, it also happens to dent major label market share too, but the issue is not quite as clear cut as it might first appear.

There are three main industry constituents that are at risk from the fattening of the long tail:

  1. Major labels and their artists
  2. Consumers
  3. Long-tail creators

Let’s look at each of those in turn:

1 – Major labels

The first on the list is the most obvious, and also the easiest, to demonstrate. Over the course of the five years from 2016 to 2021, the majors grew recorded music revenue by 71%, which is impressive enough, except that artists direct (i.e., artists who distribute without record labels) grew revenues by 318% over the same period. Consequently, artists direct increased global market share from 2.3% to 5.3% while majors went from 68.8% to 65.5%. Meanwhile, the top 10 and top 100 tracks continue to represent an ever smaller share of all streaming. The very least that can be said is that majors and their artists have collectively grown more slowly than long-tail creators, and at the most, the case could be made that long-tail creators have eaten into major’s growth.

2 – Consumers

This one is far harder to make a definitive case either for or against. Consumers tend not to categorise music anywhere near as precisely as the music business. For example, only a third of consumers say they mainly listen to older music, despite industry stats showing that catalogue consumption dominates. Most consumers do not consider music to be ‘old’ as soon as the music business does. So, imagine how difficult it would be for consumers to delineate ‘what is long tail?’ They may say in surveys ‘music isn’t as good as it used to be’, but they could equally be referring to majors’ music as the long tail. So we are in the realms of measuring second-order effects (are consumers disengaging from streaming? Not yet, but they might) and of making logical assumptions. If consumers consistently hear poorer quality music, then it is reasonable to assume that their satisfaction would decline. However, DSP algorithms push music that matches users’ tastes, and there is so much high quality in the long tail that there is no particular reason to assume that more long-tail consumption should inherently equate to an increase in consumption of poorer-quality music. And do not forget, consumers have demonstrated plenty of tolerance for ‘average’ music in mood and activity playlists.

3 – Long-tail creators

It may sound oxymoronic to suggest that long-tail creators could be hurt by the rise of the long tail. But, as Will Page put it, the rise of the long tail means that “there are more mouths to feed”. The fractionalised nature of streaming royalties means that the more long-tail creators there are, the lower per-stream counts there are and, even more important, the harder it is to cut through. The irony is that it is easier to make the case that the long tail is eating itself than it is to establish causality between its rise and majors’ loss of share.

Divide and conquer

Of course, the missing constituency is the DSPs themselves, but they do not warrant a place here, because they are the ones with the power to scale up or down long-tail consumption via their algorithms. It serves DSPs to have listening fragment to a degree as it lessens the share and, therefore, the power of any individual label. But if DSPs ever thought they were pushing too far, then they would rein in the algorithms.

Where next?

So where does all this leave us? In the ‘do nothing’ scenario, listening continues to splinter, majors lose more share, long-tail creators find it harder to cut through and earn while consumers may (or may not) see any meaningful change to their listening experiences. In short, the head loses out, as does the long tail, while the market further consolidates around the ‘body’ of streaming catalogue (which, by the way, the majors are already key players in and could easily ramp up their focus – as WMG is already doing). 

The ‘do something’ options fall into two key groups:

  1. Gate / limit consumer access to catalogue
  2. Gate / limit creator access to royalties

There are many ways to achieve the first (preventing long-tail music getting onto DSP catalogues; lowering long-tail priority in algorithms; creating a separate tier of catalogue; deprioritising / blocking it from search and discovery, etc.). All of this risks looking very much like the establishment trying to prevent the next generation of creator and industry breaking through. That is without even considering the moral dilemmas of choosing who is ‘in’ and who is ‘out’.

Option two, however, could be more altruistic than it looks. For an enthusiast hobbyist with a few hundred streams, royalties are going to be little more than a novelty. But for a hard-working, self-releasing singer / songwriter with tens of thousands of streams, the hundreds of dollars are already important. Let’s consider that there was a pay-out threshold, where 1,000 annual streams are the point at which royalties are paid, with all the royalties associated with the sub-1,000 stream artists being distributed between all other artists. Suddenly, those slightly more established long-tail artists can earn more income. 

None of these options are without challenges and moral dilemmas. But the direction of travel appears to be towards something being ‘done’ about the long tail. If that really does end up having to happen, then let us at least try to ensure that the changes benefit long-tail artists too, not just the superstars.

Time to jump off the algorithm highway

Life is perpetual change, so it is perhaps overdoing it to suggest that the music business is at a cultural pivot point. Yet, what comes next has the potential to be looked at, years from now, as a dividing line between before and after. For more than half a decade, the music business has been hurtling down the algorithm highway, repurposing artist development, marketing, fan engagement, and even the structure of the song itself in order to stay the path. Everything is splintering, from attention to remuneration, with creators and rightsholders alike finding themselves feeding a beast whose hunger is never sated. Much like an addict who wants to quit but cannot, the music business understands the problem and the costs it incurs them, yet they dare not jump off the algorithm highway for fear of being left behind by those who do not. And yet, jumping is exactly what is needed, to halt the perpetual commodification of both music and creators. It is a leap of faith, but onto a welcoming crash mat: scenes.

At Future Music Forum this week, myself and fellow MIDiA analysts Tatiana Cirisano and Kriss Thakrar talked a lot about MIDiA’s new research into scenes and identity (MIDiA clients can read our latest report on the topic here). Regular readers will be familiar with our work on fragmented fandom and how the splintering of consumption has created a parallel splintering of culture, with new hits becoming smaller and more short-lived. In this song economy environment, it is the song, not the artist, that is the central currency, thus making nurturing smaller fandoms mission critical. But fandom itself is the symptom, the cause is identity, and this, along with the scenes in which it manifests, is where the future of music marketing lies.

Algorithms have assumed a central role in the success of artists in today’s music business, with marketers forever trying to improve their understanding of their inner workings in order to gain advantage for their artist. It is, in many respects, a fool’s errand, as it is in the platforms’ interest to continually evolve the algorithms in order to ensure it is themselves that determine success, not third parties. Nonetheless, there are ways to succeed in the song economy: you may not be able to beat the algorithm, but you can join it. This means thinking and behaving like an algorithm, to hold virality by the hand. Just like an algorithm, this means real-time multivariate testing within target segments, and progressively expanding only to next-level associated segment, resisting the ability to go big as soon as something fires. But using the algorithm as a marketing discipline truly effectively entails a degree of ruthlessness that many artists and labels would find unpalatable. Algorithms find success by casting out failure instantly, instead only amplifying that which resonates within target segments. So a label pursuing this approach would need to be willing to ditch a campaign incredibly early if it does not, however much the label might believe in the release or however big a priority the artist might be. Artist rosters would become a production line of bets, as quickly discarded as signed. Failing fast is as important as succeeding fast in the song economy. 

This ruthlessness does not sit well with the traditional model of building an artist but, as dystopian a vision as it might be, is the exact path that labels already find themselves on. Scenes represent an alternative way forward.

Scenes and identity

Scenes have always existed, but now there is a growing proliferation of online scenes that allow a degree of specificity that was simply not possible previously. As Tatiana puts it:

“Not only can people find people across the globe with the exact same interests and values, algorithms actually push those people closer together”.

Though scenes can be transitory and ephemeral, subject to fast-shifting cultural trends, the really valuable ones are those that are rooted in identity, that speak to who people are about. The eBoy scene, with Young Blud as an icon, is a case in point, reflecting the values of a tribe that does not identify with the Instagram-perfect archetype of appearance. 

These scenes sometimes revolve around music, but most often, music is simply the soundtrack, with a number of artists emerging as icons, not because they have cynically targeted them but because they come from those communities and reflect their values. Fandom is an output of this shaping of identity. It is simultaneously a way of showing how much identity matters to you and of reinforcing that identity. In fact, fandom is identity’s virtuous circle of influence, with people’s fandom reinforcing their identity and communicating it to their scene community, thus reinforcing their bonds within it.

Identity is fandom’s ground zero. Music marketers that are able to identify and nurture it (rather than simply attempt to harvest it) have an opportunity to forge a depth of artist-fan relationship that will endure far beyond the whim of any algorithm, survive both hit and miss singles, and will not disappear into the black hole of lean-back consumption. 

Streaming put fandom on hiatus. Scenes represent an opportunity to reforge fandom for the modern era, an incubator for artist careers. In short, an antidote to the song economy.

Re-creating the creator economy

Everyone is a creator! Or so goes the dismissive put down of many a traditional media executive when talking about the creator economy. But regardless of what your perspective on the creator economy might be, there is no denying its meteoric rise. Perhaps what stokes the ire of some elements of traditional media is that the creator economy is evolving from being simply a talent funnel for traditional entertainment companies, into something self-contained and self-sustaining. But, for all of the positive change, there is much that is also problematic about the space. 

Harnessing aspiration at scale

First and foremost, the creator economy is a business model for the platforms and adjacent services, one that is built upon harnessing the hopes, dreams, and aspirations of large-scale creator audiences. While each of those creators individually craves success – however they might measure it – the platforms do not need the creators to find success for their respective business models to work. This is because, they monetise creators by harnessing aspiration at scale. If there are enough creators – and the pool is growing fast – a multitude of small-scale audiences are enough to drive the platforms’ strategic objectives of driving audience engagement, which, in turn, drives revenue.  What complicates matters further is the fact that creators are developing platform dependence – merely renting space on the platforms they depend upon, rarely with tenancy rights and often slave to the algorithm. It might be the creator economy, but creators fuel it rather than drive it.

Platforms are using audience as the new form of distribution

What has enabled this conflicted set of priorities to become established is the rise of platforms that use audience as the new form of distribution. Whereas traditional entertainment services, like Netflix and Spotify, license and create content to distribute to audiences, audience platforms, like TikTok and Twitch, pull their content from the audiences themselves. Even though most users consume rather than create, the creators come from their ranks. The old paradigm of license / create-distribute-audience has been replaced by audience-create-audience. If the traditional entertainment business depends on cannon balls, the creator economy trades in bullets.

Audiences are becoming creators, too, with 18% doing some form of content creation and 10% using creation tools in social platforms. Only 33% of consumers only ever purely consume content. Audiences went from lean back in the analogue era, lean in during the streaming era, and now lean through in the creator era. A growing body of creators is learning to harness this growing demand for creation, as evidenced by music creators, like Pink Panthress, Sadie Jean and Russ, canvassing input from their fanbases on TikTok.

The current surge in the creator economy is opening more doors for more creators than ever before while also bringing audiences ever closer to creation, too. But, as the number of creators grows, fandom and consumption fragment. The longer the tail, the harder it is for creators to cut through, find audiences, and build careers. Creators find themselves locked in a perpetual cycle of create / produce / perform / engage, with their host platforms demanding ever higher levels of frequency and volume of output. 

With creators’ constant fear that jumping out of the creator hamster wheel will see them disappear from the algorithm, there is a growing awareness that owning their audiences and having direct communication with them has never been more important. Yet today’s creator economy is not built this way. The rise of companies like Pico, Disciple Media and India’s ChargeBee point to the growing recognition of the ‘off-platform’ opportunity. But the majority of creators have the majority of their audiences on platforms where they are slave to the algorithm.

Owning audience is just one item on a long list of structural challenges (e.g., remuneration, discovery) that the creator economy must address if it is to transition from its current phase of undoubted opportunity, into something that can genuinely reshape and redefine the future of entertainment itself. There is both a duty of care and a window of opportunity that creator-economy companies must seize with both hands, but the second cannot be achieved without the first. That is why it is time to re-create the creator economy.

Whether you are in music, video, games, sports, or even comics, the creator economy is reshaping your business, your audience, your content, and, of course, your creators. Building upon MIDiA’s years of work in the creator economy, we have just published a landmark new report: Re-creating the creator economyIn this report, we present data, analysis and case studies of the creator economy across music, video, social, games, podcasts, sports and more, covering topics such as creator remuneration, women creators, business strategy, distribution and what independence really means.

If you are not yet a MIDiA client and would like to find out how to access this report then email stephen@midiaresearch.com

How (and why) Billie Eilish won Glastonbury

Glastonbury returned to great fanfare after the pandemic-enforced break, which meant it was the first one since 2019. The music world has changed a lot since then, with streaming getting bigger than ever and TikTok now established as a cornerstone of the music business. Back in 2019, the standard thing to do was to look at how much Glastonbury boosted streaming numbers of artists who were on the bill, but in today’s world, it is the impact on an artist’s fanbase that is arguably most important.

The BBC and Glastonbury partnership is a fandom engine room 

Glastonbury plays an important role because it is broadcast (TV and radio) and streamed in the UK by the BBC, which means it is a rare thing in today’s on-demand world: it is a cultural moment. Due to the splintering of culture and the fragmentation of fandom, cultural moments in music have largely gone, replaced by the asynchronous paradigm that streaming enables. In the past, summers were soundtracked by hits that everyone knew, now algorithms and personalisation mean that everyone has their own summer hit. Meanwhile, streaming has turned music into a utility, more of a soundtrack to our daily lives than a cultural touchpoint. If streaming has turned music into water, then what we now need are glasses to drink it from. In the UK, Glastonbury provides a counterpoint to that dynamic, presenting a few days in which everyone, from casual viewers through to due hard music fans, can watch great music – music that is, crucially, often outside of what they would usually listen to. The reason this matters is because streaming algorithms deliver us more of what we like and, thus, narrows our cultural scope. The handpicked and diverse line up of Glastonbury, amplified by the expert curation and programming of a national broadcaster, breaks music listeners out of the algorithm cage. There are not many algorithms that would present Wolf Alice alongside Diana Ross. The Glastonbury / BBC combination thus presents a real-world evidence point for how genuine discovery can be brought back into music. It is not instead of streaming, but, instead, amplifying it. 

Finding new audiences

So much for the consumer case, but what about the artist case? What an artist (and labels) really want is not just a temporary streaming boost, but a long-term lift to fanbases. Big streaming counts are a great calling card, but, unless they are huge, they do not add up for most artists. And a weekend bump is only of any real value if it provides the footprint for a longer term fanbase lift. So, what really matters is how a one-off event drives fandom growth. But how is that measures? Well, it just so happens that MIDiA is currently building a fandom measurement tool that we are calling Music Index. Let us take a look at some of MIDiA’s Index data to show just how much impact Glastonbury has already had on some of the artists who performed there.

One of the key things we do with Index is create artist cohorts to enable comparisons across similar artists, with the top performing artist in each category indexed as 100 and the others against that base. So, we defined a Glastonbury cohort to track fandom and engagement impact across these artists. Looking at the top five artists in our ‘engagement’ metric (a hybrid measure that includes streaming, YouTube, etc.), the clear winner was Kendrick Lamar, with AJ Tracey being a close second and Wet Leg a not-too-distant third. These three artists all saw the biggest gains during and after Glasto.

The vast majority of established artists do not rely on streaming as their primary income, so measuring engagement is only part of the picture. Which brings us onto our next metric, ‘fandom’, another hybrid metric that captures a large collection of fandom and social behaviours. What is interesting here is that the rankings are very different, with Billie Eilish, who was not even in the ‘engagement’ top five, not only coming out on top, but way ahead of the rest. Unlike with engagement, the distance to second and third spots is much larger. Notwithstanding, Kendrick Lamar grabs another podium spot and also saw a stronger uplift than Megan Thee Stallion, though the latter was already more highly ranked before Glasto and remains ahead.

One of the key inputs into MIDiA’s Music Index is Wikipedia. It is a heavily underrated artist metric that is front of mind for music marketers. Wikipedia is so useful because it reflects a consumer’s desire to go further, to learn more about the artist. It is a fandom lean-in metric. Whereas a Google search may simply be geared to going and finding a track, a Wikipedia view is a first step towards a deeper level of fandom. The Wikipedia spikes for the Glastonbury artist cohort demonstrates a very clear pattern of spikes in line with performances, thus highlighting the huge benefit of a widely broadcast and streamed live performance in penetrating new audiences for artists. Beyond the bigger acts, Sam Fender and Yungblud both saw strong spikes following their performances, further evidence of the unique power of the broadcast and streamed event helping artists connect with new fans.

Taken together, the Glastonbury impact can be defined as follows:

  • Kendrick Lamar might have gotten the biggest consumption bump, but Billie Eilish is likely the one who ended up with the largest long-term uplift to her fanbase
  • The Glastonbury / BBC partnership makes a compelling case for the power of building artist reach to wider audiences via tentpole, live performances broadcast and online 

Artists in the UK understand just how Glastonbury can create career-defining cultural moments – just ask Sam Fender. But the case here should be less about Glastonbury itself and more about how the live / broadcast / stream model presents a global use case for reinvigorating cultural moments in the era of splintered culture.

If you are interested in learning more about MIDiA’s forthcoming Music Index tool (there is a LOT more to it than what was covered here!) then drop a line to stephen@midiaresearch.com

Fake artists are what happens when fandom dies

The topic of ‘fake artists’ refuses to go away. For those who have been on Mars for the last couple of years, fake artists refer to artists who release under a streaming pen name but do not build any artist profile around the music. Most of this music comes from production music libraries (typically ‘royalty free’) and is seen by the traditional music business (record labels especially) as a means of gaming the system – especially as the assumption is that DSPs pay less for such music (even though record labels have started playing the game themselves). Although the ‘if you can’t beat them, join them’ might seem like a pragmatic solution, it, of course, only exacerbates the problem. Because the problem is not fake artists, but it is, instead, the way in which streaming is killing fandom.

Streaming is racing to be radio, not retail

Streaming is fast becoming more of a replacement for radio than it is retail. Retail used to be where (engaged, smaller scale) fans went, while radio was where (passive, larger scale) audiences went. As streaming got bigger, there was always going to come a point in which its focus would be the large passive audience segment rather than the smaller engaged fan segment. But what has happened is that streaming is turning everyone into the passive massive, even fans. Streaming has turned music into a utility, like water coming out of the tap. This might have helped drive global scale, but it came at the cost of fundamentally eroding the cultural impact of music, by making it about consumption rather than fandom. 

Streaming music soundtracks our everyday lives. There are playlists for everything we do (study, fitness, relaxing, cooking, working, etc.). By becoming pervasive, music has lost some of its magic. The fandom that was inherent in people buying music because they loved it is gone. The biproduct of ubiquity is utility. In the immortal words of Syndrome from the Incredibles: “When everyone is super, no one will be…”

The problem is that, from the ground up, Western streaming is geared for consumption not fandom. From playlists through to economics, streaming is all about consumption at scale. Songs fuel consumption, not artists. Which is the breeding ground for mood music, of which ‘fake artists’ are but one sub-strand. 

Streaming’s torrent of ubiquity

This is not to say that there is anything inherently bad about consumption, after all, radio has been a corner stone of the music business for, well, pretty much forever. Labels have had a love / hate relationship with radio, but they valued the way in which it drove sales and delivered exposure for songs and artists (especially as DJs talk about the music being played, interviewing artists, etc.). With streaming, though, the discovery journey is the destination. So, the post-consumption part of the equation just disappeared. And a consumption-first environment, tailored to individuals’ daily lives and shorn of the artist context delivered by DJs, is fertile ground for mood music. In fact, mood music is the natural evolution of a consumption-first system. A system in which artists get washed away by streaming’s torrent of ubiquity. 

Add poor remuneration for mid and long-tail artists into the mix, and you have a perfect storm. Why? Because artists are compelled to diversify their income mix to eke out every extra dollar they can get from their creativity, with production music libraries being eager customers of their ancillary work.

Fandom has moved up the value chain

Streaming may have killed off fandom within its own environment, but fandom itself has not died. It has gone elsewhere (Bandcamp, Twitch, TikTok, etc.). It is TikTok that has arguably done the most to reinvigorate fandom in recent years. But, crucially, it has inserted itself before consumption instead of after it. You will be hard pushed to find a mainstream music marketing campaign that does not include TikTok as the place to kick start discovery and (if all goes well) virality. TikTok has thus become the top of the funnel for consumption. Yet, rather than filtering out what is valuable, the process is more like panning for gold, i.e., filtering out what is not valuable – consumption. Fandom, identity, recreation, engagement, and connection are all left with TikTok, while consumption flows through to streaming. Little wonder, then, that TikTok is diluting streaming’s cultural capital. 

It does not have to be this way. Chinese streaming services demonstrate that streaming can be fandom machines too. Tencent Music Entertainment makes around two thirds of its revenue from non-music, fandom revenue. But perhaps the most startling example of just how much is being left on the table by Western streaming services, is found in NetEase Cloud Music’s inaugural earnings release. 212 million music users generated RMB 3.6 billion. 0.7 million social entertainment users generated RMB 3.7 billion. Yes, that means an audience that is 0.32% the size of the music audience generated more income in fandom-related revenue than the music audience did in music revenue. Right now, if anyone in the West is going to be streaming fandom machines, it is probably going to be TikTok (a Chinese company) and Epic Games (a company 40% owned by a Chinese company).

Fandom remains the under-tapped resource in the West, but its value is not simply in the revenue potential. Fandom is the essence of what makes music move us. Under-invest in it, and music will continue on its path of commodification. Which might serve the streaming platforms well, but not the wider music business. ‘Fake artists’ will become the norm, not the exception. To misquote syndrome “when everyone is fake, no one will be…”

Why Dolly Parton may want to wait before selling her catalogue

In a recent interview with the BBC, Dolly Parton said that she is considering selling her publishing catalogue, stating that she would simply launch a new publishing company and start all over again. On the one hand, this is not the first time she has publicly pondered the move (the first time was in December 2020), and is thus probably aimed at pushing up buyer demand and creating a bidding war. But on the other, it is an interesting illustration of the mindset of older artists who look to sell – they feel confident enough in their careers to simply be able to look at like an author who is selling the rights of their latest novel and moving onto the next one. But even more importantly, while cashing in might seem like a safe bet, there is risk for both sides, not just risk of whether valuations are too high, but also that they may not be high enough.

Catalogue investment is booming

The rate of music catalogue M+A acquisitions is accelerating, with announced transactions exceeding 12 billion in 2021, more than doubling since 2020*. Though those figures are boosted by some big institutional plays, such as UMG divesting some of its business ahead of its IPO, there is a rapid acceleration in the number of artists and songwriters who are selling. The market looks set to continue to be buoyant. On the buy side, there is a growing number of new investment vehicles and institutions entering the space, and thus driving up demand in a market of finite supply. On the sell side, though many big names have already sold, these are a minority of the big names of recorded music. This misalignment of supply and demand is helping push prices up, consequently accelerating the market even further.

Old, white, English-speaking males dominate

An interesting characteristic of today’s music catalogue M+A market is its bias towards old, white, male, Anglo repertoire. This reflects the investment thesis of many acquirers, which are building investment cases on valuation methodologies that revolve around historical cash flows. Put crudely, this means investments are being shaped on yesterday’s performance as an indication of tomorrow’s success. In most asset class markets, this is a very sensible approach, and in music it is a crucial component – but it is not enough alone. This is because streaming (e.g., Spotify) and social video (e.g., TikTok) are transforming how music is being consumed. Fandom is fragmenting and listening is splintering, meaning that the big hits of yesteryear are unlikely to perform the same way on streaming tomorrow as they do on radio today. At the very least, this introduces a significant degree of volatility into any outlook an investor may have. It should be of little surprise that this is where MIDiA spends a lot of its time in the consulting and advisory work we do for music investment funds.

The next music business is building 

This is where the artist and songwriter’s appetite for risk comes in. For an older songwriter or artist, selling up represents an opportunity to bank previous success, to capitalise on the unprecedentedly buoyant music market. But the market has a lot of growth left in it yet. In fact, the best days are likely still ahead of us. 2021 was the biggest growth in the recorded music market in modern times (watch out for MIDiA’s official figures, which are coming very soon)! Even if the digital service provider (DSP) streaming market, epitomised by Spotify, may be maturing, non-DSP streaming (TikTok, Meta, Twitch, etc.) is only just getting going and contributed significantly to 2021 growth. On top of this, new horizons are being set in the shape of the Metaverse, NFTs, Blockchain, and decentralized autonomous organisations (DAOs). Web 3.0 is riddled with risk and inflated expectations, but, as with all cases of looking at future tech, it is easy to overestimate the near-term impact and underestimate the long-term effect. Meanwhile, there are moves across the globe to increase the amount of streaming money that flows to the creators themselves. Add in the growth of emerging markets; growing rights transparency; and the booming music creator and creator tools economies and you have the foundations of an entirely new chapter for the music business. 

Which brings us back to Dolly Parton. In many ways, she is like the gambler sat at the poker table with a pile of chips in front of her. If she walks away now, she banks a fortune, but what of she plays for just a little longer. Except that, in the case of the music business, the odds are not even. Unless Russia dives the global economy into a disastrous drop – which, of course, is no small possibility – things are only going to get better for the music business. But, just like on the poker table, an artists or songwriter does not need to go all in. A growing number of investors are becoming more sophisticated with how they work with creators. For example, allowing them to retain certain rights, or a portion of overall rights. This means that the creator gets to benefit from the future upside while also benefiting from the up-front cash. It also means that the creator remains vested, with an incentive to help keep those old songs alive (and, as a result, increasing their value for all parties) rather than simply moving onto the next chapter. 

There is no doubt that the music catalogue sector has boomed, and there is also an argument that prices are inflated, at least in comparison to yesterday and today’s business. But for creators and investors who are prepared to take a long-term view, things might only just be starting.

*Look out for much more market analysis and data in a forthcoming MIDiA report on music catalogue acquisition by my colleagues Tatiana Cirisano and Kriss Thakrar

Music creators – we want your insight!

Beyond our role in analysing, reporting, predicting, and consulting within music and media, MIDiA is a team of people – many of us creators too – who are committed to making a fairer, more sustainable and creator-friendly music industry. To this end, we are currently fielding a survey for music creators (who are based in US and Canada) in order to learn about how they are making money and what they consider to be definitions of success. The survey is open to artists, producers and songwriters, as well as managers and business managers.

If you are an artist, songwriter, producer or manager, please help us by filling in this short, 10-minute survey.

The results will be used to develop monetisation tools for artists – This survey is your chance to make a contribution to the music industry, and to help companies build the most efficient finance tool for artists – so please help!

Note, we are looking for around 200 responses and five lucky participants will win $1000 in Amazon gift vouchers from our prize draw!! 

Click here to complete the survey.

Artists Survey 2022 – MIDiA asks music creators: how will you grow your audiences, earnings and career?

As the music industry continues to debate the many pros and cons of ‘the streaming era’  (while enjoying the unprecedented industry growth that it has brought), the spotlight can sometimes move away from those artists and songwriters who make a living from music but are not the big stars or household names that we know and read about in the news. 

At the same time, the ‘creator economy’ continues to boom, something MIDiA has been following, researching, and supporting for the past few years. As part of our work with music creators, we have spent the past 12-months speaking to artists, songwriters, producers and their managers about their priorities, concerns, challenges and hopes for the future as they make music, release it and, just maybe, establish a career in doing so.

We have learned a lot from these conversations. There is great insight from in-depth interviews with artists and songwriters, many of whom will (and should) capture the attention of all of today’s industry players, from streaming services to labels and creator tools companies.

For example, we have learned that the most proactive, ambitious artists see themselves as small businesses / startups, with a key goal to ‘bootstrap’ their own careers, thus creating a self-sustaining business with existing resources, rather than borrowing money or hurtling headlong into a ‘record deal’. In the streaming era, for many up and coming artists, success is more about making a sustainable living from music than it is about fame and riches.

Another great insight we have found is that artists are focused very much on core, loyal fans rather than large audiences that may come and then go. While most artists would love to ‘have a hit record’, even more of them appreciate not needing or relying on that rare event happening. Artists are focused on building 100-1,000 core fans rather than marketing to the masses, hence they are looking for tools that will help them directly reach fans, as well as helping them collect all the actionable data about their fans, which will ultimately guide them into creating relevant and engaging content for them.

As for monetisation, many artists are, of course, concerned that streaming does not pay the bills. Many of the artists we have spoken with have the perception that streaming is passive listening, and while it is great for profile and promotion, it is the other revenue streams that they need to focus on (for example, live touring, live stream sessions, merch, sync, and even teaching and session work for other artists). Many have launched Patreon pages or are looking to commercialise their own fan channels, and when it comes to new technology, there is both excitement and trepidation surrounding NFTs.

As part of MIDiA’s mission to understand and support artists, and work towards a more sustainable future for creators, we have launched the first tranche of our 2022 artist survey, focusing, at this stage, on North America and Canada. We want to hear from up and coming artists who are just setting out on their musical journey, direct artists who are using creator tools and distribution services in particular, but also established artists who are a few albums into their careers. 


If you are an artist, songwriter, producer or manager, please help us by filling in the short, 10-minute survey here, and note, we are looking for 200 or so views and have five prize draws from this sample to provide $1000 in vouchers

Beyond our role in analysing, reporting, predicting and consulting within music and media, MIDiA is a team of people – many of us creators too – who are committed to make a fairer, more sustainable and creator-friendly music industry. This survey is your chance to make a contribution so please help!

Why Spotify cannot afford to make it three out of three with podcasts

It has been a couple of weeks that Spotify would be glad to forget – if it could. Although many of the arguments have been emotionally charged and the debate says as much about people’s political beliefs as it does business strategy, it is indisputable that there is a lot at stake for Spotify. Podcasters are its big bet on the future, music artists are the current bet that pays the bills. Both constituencies need to be kept happy, but can they both be kept happy enough and at the same time? Spotify’s big-future podcast vision has been sold to investors, divesting or censoring Joe Rogan would shake those investors’ confidence in Spotify’s ability to execute on podcasts. But it would be more than just that, it would be the third time that Spotify has had to backtrack on a big bet. Once may be careless, twice bad luck, but three times would most certainly not be a charm.

It is worth remembering why Spotify is betting big on podcasts. Strategically, it wants a slice of the $30 billion radio advertising business, and it wants to ensure it is competing in all lanes of audio. But that is more about the opportunity, the potential. There is also a more prosaic motivation: podcasts represent the ability to grow higher margin revenue and give Spotify more control over its own destiny. Rather than be beholden to music rightsholders and face continual calls for higher rates from artists and songwriters (which risks making margins even smaller), Spotify can plot a course to a future where it owns much of its own content. This means both more control and higher margins. Win-win.

Spotify as a label

The only problem is that as a music platform that has acquired its hundreds of millions of users through music, music rightsholders and creators do not take too kindly to feeling like they are yesterday’s game despite still driving the vast majority of the revenue. And yet, it need not have been this way. The origins of Spotify’s podcast bet lay in the failing of their second big bet: direct artists. In September 2018, Spotify opened up its platform to artists to release their music directly on the platform. The labels of course saw this as a massive threat of disintermediation, shook their fists in fury, and compelled Spotify to swiftly backtrack, dissipating the service in July 2019. The irony is that Spotify was trying to achieve the same objectives with direct artists as it is with podcasts: more control and higher margins. The labels managed to get the strategy killed off, but in doing so they pushed Spotify into pursuing what may be an even more disruptive strategy. Competing with Spotify as a label might have been daunting to the music business, but at least the world’s leading music subscription service was still going to be squarely focused on getting its users to listen to music…

Spotify as a video service

If direct artists was Spotify’s second failed big bet, then video was the first. Back in January 2016, Spotify announced that it was becoming a video service. Featuring original content commissioned from giants of TV, such as Viacom and the BBC, Spotify went big on video. Unfortunately for Spotify, its users did not and Spotify quietly backed away from what briefly looked like a major expansion of Spotify offering away from music. Recognise the trend?

Fortune favours the brave

Spotify’s bet-based strategy is both admirable and has underpinned its huge success to date. It is just unfortunate that the biggest, highest profile bets have not panned out. If Spotify were to fail with the podcast bet too, then the consequences could be catastrophic in terms of investor sentiment. But Spotify has to bet big. It is a tech growth stock, and thus its market value is defined more by what it can be tomorrow than by what it is today. Being the leading player in a commodified and slowing DSP streaming market is not the sort of growth story that underpins valuations like Spotify’s. So it needs big dreams to aim at. 

Yet the irony is, if podcasts do not pan out then Spotify will be back at where it started: as a music streaming company (just as it was after the first two failed bets). This would be an interesting contrast to Netflix, which (occasional foray into games excepted) has had a singular focus on being a video service and is still a video service, with no failed side bets along the way.

The House of Cards moment

The likelihood is that Spotify will make a big success of podcasts, and audio more generally –and the Joe Rogan phase will be looked back on like Netflix’s House of Cards phase: a hint of what will come, the genesis of something much bigger, much more culturally impactful, and far more pervasive. But Netflix did not get to where it is without antagonising (and losing) partners along the way. TV networks that had been licensing their content to Netflix suddenly realised it was now competing with them too. By making their shows available on Netflix they were actually helping a competitor compete against them. Disney and Fox took it so seriously that they pulled their catalogue.

Netflix cause ill feeling among some TV networks and became an outright enemy. That is something Spotify cannot do with music rightsholders and creators. Spotify is currently causing ill feeling among the music community by going to great lengths to accommodate its podcast creator community, which is in stark contrast to the numerous missteps it has made with the music creator ecosystem over the years. It can do so, because it has leverage over music creators (few feel bold enough to remove themselves from Spotify), but Spotify (despite being the leading podcast platform) is still a long way from having that sort of hold over podcast creators.

‘Too big to fail’ is not enough

Netflix survived its backlash, not because it was ‘too big to fail’, but because the video streaming market is fragmented, so it could survive without the networks it antagonised (and two of those networks could go it alone via Disney+). The music streaming market is very different – losing labels and artists would simply reduce Spotify’s value proposition compared to its competitors. Spotify cannot afford its podcast ‘House of Cards moment’ to be followed by a ‘Disney moment’ for music. Matters just got further complicated by a major investor now raising concerns about Spotify’s podcast editorial policy – which means that this is no longer even a clean case of managing investors-vs-the music business. Spotify has an intensely delicate path through which it must find its way.

If it does, then third time really will be a charm for Spotify.