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Streaming Costs Going Up in 2024

TheBigA said:
The Copyright Royalty Board, a group of judges who set royalty rates, have approved a 4% cost of living increase for 2024. So prices will be going up:
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Heard yesterday on the radio that Spotify is cutting 17% of its workforce, or around 1,500 workers in the third round of layoffs in 2023. The reason cited amounted to the 'over-hiring' in 2020-2021, but one must wonder if the expected increases in royalty costs might have them hedging their bets when it comes to getting ahead of operational costs:
Spotify to Cut 17 Percent of Global Workforce in Third Round of Layoffs This Year
 
Welcome to the future. Streaming is the dominant music consumption and music revenue model. So if costs go up, they're going to go up. Pay to play.

RE: Spotify: I heard on the CBC earlier tonight that Spotify is cutting close to 20% of its workforce after investing in a bunch of podcasts, like they did with Joe Rogan's popular one a while back. The investments looked good for the platform, but they still lost half a billion earlier this year. They also expanded into audiobooks, where a premium subscriber could have access to 15 hours a month. It was a deal apparently cut with the big book publishers. So they've been trying to expand the reach of their platform, but it's not making them enough money to cover all of it. At least not right now.

This NY Times article includes info on the podcast contracts and their effect on the bottom line.

www.nytimes.com

Spotify to Cut 1,500 Jobs After Spending Spree (Published 2023)

The music streaming service has expanded into podcasting and audiobooks but found it difficult to turn a consistent profit.
www.nytimes.com www.nytimes.com

From the article:
"Spotify also has more than 360 million monthly active users whose accounts are supported by advertising. This segment has been growing faster than paid subscriptions, but it generates less revenue at a lower profit margin for the company."

So, the advertising revenue apparently isn't making up for the losses, either.

Streaming is the future, but the business model is still being worked on.

As for the rate increase, not much is going to make it to the common, streamed musician. What's 4% of an average of $.005 per stream? I suppose it's better than nothing, though.
 
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When does this start to impact YouTube, an invaluable, free (with ads) resource for music in all genres, current and catalog? Right now, you have individuals with YouTube channels containing 1,000 or more singles, album tracks and concert performances, all covered under YouTube's agreement with the music industry. What is the out-of-pocket cost now for someone to maintain a 1,000-song collection? Will these amateur music libraries, especially those featuring "forgotten 45s" and other obscure music of decades past, be able to survive, or at some point, will only Vevo and other industry-friendly YouTube streamers survive? And if that happens, what becomes of the lost hits, B-sides and deep cuts that will disappear with the demise of the YouTube equivalent of mom-and-pop stores?
 
I would imagine this will affect TikTok negatively also since so many of their videos rely on popular songs or variations of popular songs. Even if it’s something not popular, music is still likely to be licensed.
 
101tm said:
I would imagine this will affect TikTok negatively also since so many of their videos rely on popular songs or variations of popular songs. Even if it’s something not popular, music is still likely to be licensed.
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Yes TikTok pays music royalties at a rate of .03 per play.
 
CTListener said:
When does this start to impact YouTube, an invaluable, free (with ads) resource for music in all genres, current and catalog? Right now, you have individuals with YouTube channels containing 1,000 or more singles, album tracks and concert performances, all covered under YouTube's agreement with the music industry. What is the out-of-pocket cost now for someone to maintain a 1,000-song collection? Will these amateur music libraries, especially those featuring "forgotten 45s" and other obscure music of decades past, be able to survive, or at some point, will only Vevo and other industry-friendly YouTube streamers survive? And if that happens, what becomes of the lost hits, B-sides and deep cuts that will disappear with the demise of the YouTube equivalent of mom-and-pop stores?
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I think in the case of YT, the actual platform (Google) is paying the royalty.

I'm not sure about the mechanics of how YouTubers make money, though. I think it's through some agreement with Google/YouTube.
 
Not to be Captain Obvious, here, but in these lean times a good bit of streaming has already been discontinued. It seems to me that a little bit of something is better than a whole lot of nothing if a station wants to remain on the air in terrestrial radio where they have always held up just fine.
 
Theater of My Mind said:
That's the goal. Streaming costs already effectively shut out all but those with the deepest pockets.
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I'm aware of a few recording artists who tried to run their own streaming sites. The royalty laws made it impractical for them. The irony is they can't afford to pay user royalties on their own music. The only way a lot of these musicians can make money on their music is to sell the rights to much bigger companies.

Back when the DMCA was being discussed, the music industry wanted to structure it in such a way that small streamers paid less. It didn't end up that way. Now you have to be big in order to survive. We hear the same claims from the same music industry about imposing the same music royalty on broadcast radio. They claim their new royalty won't hurt small radio companies. But we all saw what happened in streaming.
 
Now religious radio stations are challenging the new streaming rates, saying it violates their rights:

www.insideradio.com

Religious Broadcasters Get More Time From Supreme Court To Challenge Streaming Rates.

The battle over streaming music rates is far from over, at least from where religious broadcasters sit. The National Religious Broadcasters Noncommercial Music License Committee plans to file an appeal
www.insideradio.com www.insideradio.com

This is where things get really murky. They claim that NPR stations pay a lower rate than them, and the reason NPR pays a lower rate is because they're government radio. That's all a bunch of hooey. They then claim that the government pays the NPR royalties, which also isn't true.

Religious broadcasters have chafed at the CRB decision for the past two years, viewing it as a violation of the federal Religious Freedom Restoration Act Restoration Act. The law prohibits federal agencies from substantially burdening religious exercise “even if the burden results from a rule of general applicability.” The broadcasters say what is unfair is that the CRB’s deal with public radio stations affiliated with NPR allows them to pay much less than what religious stations would be required to fork over. By NRBNMLC’s calculations, religious webcasters are paying more than 17-times the average NPR rate – which it sees as a violation of the Religious Freedom Restoration Act.
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The truth is NPR stations are mainly news and talk, so they don't play much music. The issue might be the non-NPR public stations, which are mainly all music.
 
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^^^^^^^ The article seems to center on "non-commercial religious broadcasters", so I wonder if this is a reference to EMF, and maybe similar broadcasters, and streaming only religious music stations? More than half of the religious broadcasters in my metro are commercial (KCMS, KCIS, KGNW); where the other two are EMF (AIR One and K-Love, and I don't think they run commercials, the wiki states EMF is "non-commercial".
 
boombox4 said:
The article seems to center on "non-commercial religious broadcasters", so I wonder if this is a reference to EMF
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The article is based on this organization (NRBNMLC), which is a membership organization that negotiates royalty rates in the way that the RMLC does for commercial radio. Radio stations choose to be members, and the committee uses the collective power of thousands of radio stations as leverage. So yes it's likely that EMF is part of it.
 
Years ago there used to be a regular contributor to this site who had started his own grassroots music-streaming operation. About the time Sound Exchange got into the picture, he disappeared. As I recall, some of his last posts mentioned concern over given the (at the time) proposed rights fees, whether he would be able to maintain operations going forward.
Certainly, nobody wants to publicly admit they got crushed, but I for one would like to read an update on what happened, good or bad. It's a good lesson for those interested in starting a music streaming service.
All this makes me wonder how legacy music streaming sites with particularly deep playlists, like Radioparadise.com, can stay alive.
 
Kelly A said:
Years ago there used to be a regular contributor to this site who had started his own grassroots music-streaming operation. About the time Sound Exchange got into the picture, he disappeared. As I recall, some of his last posts mentioned concern over given the (at the time) proposed rights fees, whether he would be able to maintain operations going forward.
Certainly, nobody wants to publicly admit they got crushed, but I for one would like to read an update on what happened, good or bad. It's a good lesson for those interested in starting a music streaming service.
All this makes me wonder how legacy music streaming sites with particularly deep playlists, like Radioparadise.com, can stay alive.
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In a similar vein, I've been seeing more and more "unscoped" audio of DJs from the '60s and '70s on YouTube than I ever have -- full hours of jocks from Top 40 and MOR stations across the country, with full songs played. Does Sound Exchange not care about this anymore, or is this use of copyrighted music covered under the same agreement that allows anyone to post their entire collections of old 45s on YouTube?
 
CTListener said:
In a similar vein, I've been seeing more and more "unscoped" audio of DJs from the '60s and '70s on YouTube than I ever have -- full hours of jocks from Top 40 and MOR stations across the country, with full songs played. Does Sound Exchange not care about this anymore, or is this use of copyrighted music covered under the same agreement that allows anyone to post their entire collections of old 45s on YouTube?
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It's a mystery, but sometimes an aircheck video will still be flagged over 1 song.
 
CTListener said:
In a similar vein, I've been seeing more and more "unscoped" audio of DJs from the '60s and '70s on YouTube than I ever have -- full hours of jocks from Top 40 and MOR stations across the country, with full songs played. Does Sound Exchange not care about this anymore, or is this use of copyrighted music covered under the same agreement that allows anyone to post their entire collections of old 45s on YouTube?
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I'm guessing the demand for hosting probably low-quality airchecks from back in the day isn't high enough to show up on the copyright police radar. One has to put it into perspective; that fans of old airchecks are overall pretty few in number.
 
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