Online streaming blossomed through the pandemic, with time spent on subscription services doubling through April 2020.
According to Ofcom, video streaming platforms brought in 12 million new users through the lockdowns, surging viewing figures by 71% on 2019’s numbers.
Physical restrictions have also seen broadcasted live music events grow, with over a quarter of US and UK fans saying they would like to see more in future.
Despite this, the consumption of audio fell by an eighth in the days following the first lockdowns and is yet to recover. Covid has fundamentally changed the way we consume content, and the shift seems here to stay.
Why users are ditching audio for video
It is no coincidence that the pandemic has also revived Spotify’s fair pay debate.
Live music venues were some of the first businesses to close and the last to reopen through the pandemic. Many established artists put off releasing music until after lockdowns in order to support their tours. But for smaller artists, the change could prove an existential threat.
With more pressure on online platforms to provide a stable source of income, independent creators spoke out about unfair pay from audio streaming. Innovators have since found new ways to make a living from their music, focusing more on merchandising and offering online video events.
At the head of this, Bandcamp’s ‘Bandcamp Fridays’ promotion waived the platform’s fees for independent creators, offering artists an easier way to monetise their skills while bringing in new customers. Apple Music also aimed to draw creators in with the promise of a penny per stream.
With 299 million users, Spotify is the world’s most popular streaming platform but royalties for creators only amount to $0.0038 per listen.
It is not only Spotify having trouble, though. Audio consumption in general has been hurt by bans on travel and events. Former commuters no longer have to block out ambience in the office but may have more time to watch live sets on YouTube at home.
The ban on live music in 2020 gave momentum to ‘quarantine concerts‘, which have proven a lucrative option for artists post-pandemic. Users aged six to sixty now have some familiarity with remote work and learning, making ‘techy’ video streaming options more viable for artists this year.
The surge in popularity for video streaming has made way for new players to enter the market; artists empowered by choice are well-positioned to push back against poor pay and move elsewhere. Guaranteed an online audience, savvy artists now have a way to monetise even sold-out events and reduce their reliance on audio royalties.
The issue of pay may prove a thorn in Spotify’s side if it can’t coordinate a response. This is an issue that matters to consumers as much as it does artists. As of October 2021, The Indiependent found that 83% of music listeners would be willing to pay a higher subscription fee to guarantee a ‘fair’ rate for creators.
11% would be willing to pay at least an additional £10 per month, even though the current average monthly spend is less than £10.
Audio streaming still proves overwhelmingly popular, with 88% using one or more subscription services.
But 31% also use video streaming platforms to get their music.
So far, Spotify has pledged to be more transparent in its pay policy. In March 2021, the company published a report showing that over 13,000 artists generated over $50k in payments in 2020, double the figure from 2017.
Spotify also claims that 15% of catalogues generated over $1,000 in 2020– which are paid to record labels, not directly to artists.
How fair pay is changing music forever
Investment in video streaming has given users a new outlet for consumption.
With subscribers now accustomed to streaming live sessions, providers are filling the void with the promise of a fairer model for creators that offers consumers a more intimate touch.
Scott Green, founder of upcoming streaming service lounges.tv, told The Indiependent: “We have looked at the streaming boom and the gig economy, which is going to come back with a bang, and we have merged them into one platform that allows talent to really monetise their audiences.
“We want to give people a playing field for people which pays them based on their talent and not their influence. Currently, unless you have millions of followers, you just can’t make money. So it doesn’t matter how talented you are, it’s not a level playing field.
“As long as you have a small audience, you should be able to make money. The average person may only have 1,000 followers, but if they can convert 10% of that audience on a pay per view model, then they can start earning some good revenues.
“We are convinced that the revenue model should be way above the average minimum wage.
“There is lots of evidence that says that people are willing to pay for good content. People are happy to pay for community-generated content. There just isn’t enough of it around.”
Launching in early 2022, the platform will give users the option to pay for subscriptions or individual pieces of content hosted by the creator they follow.
80% of fees will be paid directly to the artist within 24 hours, with the provider taking a 20% commission.
Lounges.tv will offer users personalisable experiences and interactions with their favourite creators, as well as wide tuition and other forms of entertainment.
The platform’s advisory board includes the ex-General Manager of Motown Records, Mervyn Lyn, the creator of BBC iPlayer, Ben Lavender, and broadcast streaming specialist, Remi Abayomi.
While lounges.tv is not looking to supplant Spotify as the premier audio subscription service, its owners recognise that audiences are increasingly turned on to platforms that can guarantee fairness and transparency for artists.
Looking forward
Spotify has had 15 years to build its empire. Its hegemony over audio streaming will not be unsettled easily. But artist and listener dissatisfaction with pay for creators has carved out a neat new arena for other platforms to thrive in.
The catalyst of the pandemic has forced users into choice, an oversupply of variety that is now starting to bear fruit.
Music streaming in one form or another is here to stay. But its traditional boundaries may be due a rethink.
Words by James Reynolds
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