"Pandora is barely giving anything of worth for using the songwriters and artists' music," Gizmodo writer Casey Chan points out. Which is true. But ironic, since it was just four years ago that Gizmodo writer Sean Fallon pointed out, also correctly, that "excessive royalty rates were the main reason sites like Pandora hovered near the brink of collapse [in 2008]." We all want our favorite musicians to be rich and also would prefer to pay nothing to listen to them over the Internet. When we hear that our musicians aren't rich, we feel indignant. When our Internet music sites threaten to close down because of "excessive royalty rates," we feel indignant. The solution is to abandon all hope ye who enter the Internet as a means of making a million dollars with streaming music. Even if Pandora quadrupled the royalty rates paid to Lowery, it'd barely pay for three days rent. If you want to pay a musician, there is an easy fix. Go to a concert.
Digital revenue comes in a variety of forms. Sales of downloaded singles and albums, from services like Apple’s iTunes, continue to grow. More promising for the industry, however, are subscription-based offerings, including Spotify, Rhapsody and Muve Music. The number of subscribers to services like these grew by 44 percent last year, to 20 million, the federation said. Several new entrants are expected soon, including subscription services from Apple and Google, promising additional subscriber fees and licensing revenue for the record companies. Other sources of revenue, including royalties from musical performances and marketing uses of music, have also been growing.
The latest round of musical chairs comes as recorded music sales continued a plunge that began in 2004. Moving into the fourth quarter of 2010, album sales were down 13%, according to Nielsen SoundScan; if holiday purchases don't generate an uptick, this year's drop could beat the 12.7% downturn of 2009. The bottom fell out of the CD market years ago, but digital downloads, a growth market in recent years, began to stall in 2010. Total track sales are virtually flat to date this year vs. a gain of 12% last year, according to figures recently published by Billboard. Piracy continues to plague the industry despite action like the court-ordered shutdown of LimeWire's peer-to-peer service in November. As torrent sites proliferate, an illegal download of virtually any hit track is still just a mouse click away. In terms of music's valuation, it was a case of "how low can you go" this year, as Amazon.com's Daily Deal pricing of hot new albums at $3.99 lofted some titles like Arcade Fire's "The Suburbs" to the top of the charts. In one case, online availability of one prominent catalog thrust CD prices into the basement: After the Beatles' music was finally offered digitally via an Apple iTunes exclusive, Amazon offered remastered CDs of the group's titles -- launched in September 2009 at a full price of $18.98 -- for just $7.99.
Downloads through online retailers such as iTunes have taken on greater importance to the industry, but the impressive growth of recent years is waning. Digital track sales rose 8.3 percent to a record 1.16 billion in 2009, but that was proportionally far less than a 27 percent increase in 2008 and a 45 percent leap in 2007. Digital album sales rose 16.1 percent to 76.4 million units, also a record, after jumps of 32 percent in 2008 and 53 percent in 2007. After Swift, the No. 2 album of 2009 was Scottish singer Boyle's debut release, "I Dreamed a Dream," which sold 3.1 million copies after six chart-topping weeks in stores.
There's only one problem with Wyden's professed support for indie labels. The American Association of Independent Music, which represents many well-known indie labels, including Sub Pop (Tim/Kerr is defunct, and I.R.S. is now part of a major label), has come out against his legislation. In a letter to Congress dated October 1, the organization writes, "We urge you to reject misleading titles of 'fairness' and claims of 'parity' and oppose this bill." Kurt Cobain could not be reached for comment.