Streaming Music on the Internet

The Takeaway

The following is not a full transcript; for full story, listen to audio.

Streaming is free music available online, but it is not downloaded so you don't have to worry about the RIAA knocking down your door.

In the last 20 years the music industry has changed a lot: from vinyl to tapes to CDs and now streaming.  After years of slow internet connections and restrictive record labels, streaming has now become a viable, legal alternative.  At one point, a search for a song might yield several cover versions and an illegally posted origianl version of it.  Now that artists, labels, and certain sites/providers have inked deals, finding high quality, legitimate versions of songs is no longer a struggle.

There is a new service readying for launch in the U.S., after having some success in Europe, called Spotify.  Maura Johnston, editor of the music blog "Idolator," says "Spotify people love because the interface is really elegant.  It is very much like iTunes.  It's ad-supported, but it's ad-supported in such a way that it is very minimally intrusive.  And, the catalog is unparalleled — it has a lot of songs.  They just signed a deal with 2 million songs with an independent distribution site, so they have a lot of indie music now, and other classical (music)…"

There have been variations on the ad-supported free music model in the recent past, but the user experience that the advertisers required made the experiences unpalatable to many.  The interfaces have come a long way since some of the early models were rolled out.

However, says Johnston, "The services pay money to the labels in order to license the music, and unfortunately, the problem is the ad revenue right now is not really catching up with fees that the…services have to pay to the labels."  This is a problem that other service providers dealt with in the late 1990s when e-commerce was establishing itself.

"Everyone is in this dance of trying to remain profitable while also continuing to provide a service."

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