Music Streaming and the Disappearing Records
Tags: startup
Published: 2020-04-22 13:36:50

[Other tags: streaming technology, music, spotify, digital subscription models, DRM, disruptive technology]

I'm part of the Napster generation.

That means I pretty much stole all the music I grew up listening to. Unrepentantly, unremorsefully, downloaded everything.

Napster might seem like a dim and distant memory in internet time, but it's easy to forget quite how game changing Napster was for both the music scene, and the industry.

For anyone who might be too young to remember, or perhaps not technically savvy enough at the time, Napster, while not the first way you could "borrow" music from the internet, was the first popular Peer-to-Peer file sharing network.

It was ridiculously easy - you installed the software, told it where your collection of MP3s (songs stored as files on your computer) were and everyone else did the same. You were faced with an empty search box and your imagination and it just worked.

You could search for anything you wanted, however esoteric, and for the most part, Napster delivered.

It'd hard to explain how much of a revelation this was in 1999 - a year after Google was founded, and a handful of years before search on the internet really worked well at all.

I was 15 in 1999, teaching myself C++ and Perl, and this seemed like magic. Everyone ripped the few CDs they could afford to buy themselves to their computers, and in return we got everything.

When you're 15, the complex relationship between rights owners, writers, musicians, ethics, points based royalty systems and the music business was all literally the furthest thing from your mind. You're hungry for culture, and music, for as long as it's been recorded, had always tracked generations and cultural shifts.

People forget just how hard it was to discover new music, especially non-mainstream music in the 90s, and earlier.

When home cassette recording was becoming popular in the early 80s, the record companies were scared. Home Taping Was Killing Music! They proclaimed - yet the same taping and trading scene, participated in by kids eager to hear new, increasingly niche and underground music, rebelled. That same taping scene enhanced the burgeoning New Wave of British Heavy Metal scene, internationalising it, making music accessible to everyone.
It's no coincidence that bands like Metallica rose to prominence by both their own participation in the demo trading scene of the early 80s, later weaponising this grass roots movement into international success.

But the 90s were different. The taping scene was related to live bootlegs, and the onward march of technology proven cassettes to be unreliable - home taping didn't kill the industry - it's actually gave the industry room to innovate on quality and easily win.

And oh boy did the industry win. The 90s were probably the final hurrah for rockstars and massive pushed music outside of mainstream pop. They didn't realise it then of course, but somebody did. Someone who made his name in the taping scene.

Lars was right.

Which is an awkward admission for a self-admitted former music pirate.

In 2000, Metallica, et al v. Napster inc saw the first time ever a court case was brought against a Peer-to-Peer filesharing network. Lars Ulrich, Metallica's drummer, was exceptionally vocal in the media about the widespread damage he saw file sharing causing to the music industry.

"Napster hijacked our music without asking. They never sought our permission. Our catalogue of music simply became available as free downloads on the Napster system."

Lars was right. Technology has this wonderful and world changing ability to ask, "can we do this thing?" but it rarely stops to see if it should. Metallica won.

Collectively, we, the youth, demonised them. Greedy rich millionaires pulling up the ladder behind them. Metallica inadvertently fuelled the boom in DRM and various rights management technologies of the late 90s and early 2000s, but the effects of the Napster lawsuit are still felt today.

While they thought they were fighting for their creative agency, they really were fighting for control. What the Metallica suit did was push file sharing underground into a series of different sharing platforms, which were more difficult to regulate, harder to track, and more resilient. They ironically made file sharing more sophisticated.

Lars today understands that the fans, the youth of the day thought Metallica were fighting them, rather than the file-sharing organisations. All his fears did come to fruition though.

It's a sobering admission to be on the wrong side of the argument twenty years later.

# The Long Tail of File Sharing

But what if file sharing was used for good?

The file-sharing epidemic of Napsters launch wasn't the start of file-sharing. But actually the end destination of an entirely different scene, completely distinct from the tape trading of the 80s. 

With its origin in 80s hacker culture, and continued survival on pre-World Wide Web protocols like usenet (a distributed message board system that predates web pages) and IRC (a decentralised chat protocol that was extended to support file transfers) - the digital music trading scene of the late 90s was part of the Warez scene - often just called "the scene" to people involved.

The scene is a closed community of ripping groups specialising in ripping (converting media to digital copies) and distributing copyrighted material, complete with its own rules and regulations about getting access to material - often before release. The scene doesn't really care too much about the material it distributes, though access to pre-release games, movies and music is absolutely a motivating factor. In many cases, scene release groups formed around specific types of content, cracking games, acquiring pre-release music, and distributing them all through private channels and FTP servers. The rise of Peer-to-Peer technology saw many previously difficult to obtain scene releases leaked out to the general public drawing the attention and ire of the recording industry.

This was exactly the kind of technologically advanced, weaponised, piracy that they had feared at the rise of cassette tape duplication - but this time it was viral, hard to stop, and terrifyingly, more advanced than any of the technology the recording industry was using at the time.

You can't put this kind of genie back in the bottle.

For the better part of a decade, the record industry fought a war of attrition with scene releases, the rise of Napster alternatives like AudioGalaxy, KaZaA, LimeWire and eDonkey (never say we’re bad at naming things in technology again…) and the dedication of an entire generation who believed they were in the moral right, fighting evil megacorporation’s trying to enforce archaic copyright law.

And the industry fought and fought.

In a ferociously blind moment, the music industry never critically assessed the value proposition of its products, and they never innovated on the formats. CD prices, especially in the late 90s and early 2000s were at a record high, and as the war against scene rippers and street-date breaking leaks intensified, the products that were being sold were subject to increasingly dubious and in some cases dangerous DRM (digital rights management) approaches in a futile attempt to prevent piracy.

The music industry really didn’t stand a chance – the file-sharing scene entrenched, worked on it’s technology and was brutally effective. BitTorrent became the tool of choice, and the “mass market piracy” calmed down back to smaller communities of enthusiasts around specific genres or niches.

Across the same time window, CD-Rs and home CD burning reached mass market acceptance and affordability. But for labels? The prices had never really come down. They were used to making a lot of money on CD sales, and giving big number advances to artists, but as they saw their profits shrink, they were struggling. The largest cost in the majority of business is always staff and humans - and the scene didn't have to compete with that.

In the UK, high street retail chains like HMV, Our Price, Music Zone and FOPP went into administration, were bought, and entered administration again – relying on cut price DVD sales to keep the doors open (a format that was still slightly impractical for the average user to pirate at the time).

But something more interesting was happening. People were using illegal music sources not just to steal music they knew they wanted, but to discover things they’d never heard of. There were reports that consumers of illegal downloads were actually… spending more money on music?!

While everyone was so caught up on the idea that people were just out to get things for free (which was certainly more than case with the consumption of other contemporary piracy like that of games) music and it’s particular place in the cultural ecosystem, with live performances, and merchandise, and youth identity, actually saw some uplift where bands that would have never gotten the attention of a label were suddenly independent darlings.

While the majors were losing, and the millions-of-unit pop albums of the time were performing poorly, the underground was thriving, much like that early tape trading scene. This phenomenon dovetailed with the rise of then nascent social media platforms like Livejournal and later, eponymously MySpace and the idea of the “MySpace Bands” – but what these bands really were was the grass roots marketing of local niche scenes into bigger audiences, powered by the leveling of technology, and the groundwork done, ironically, by software like Napster.

Did Napster accidentally “save music”?

A whole generation of people grew up stealing music and being totally ok with exploring music they would never listen to precisely because it didn’t cost anything. Sadly, you can’t feed your kids on the willingness of people to explore music free of cost.

There were breakout bands from the “MySpace scene” in the underground – the Arctic Monkeys, Bring Me The Horizon, Asking Alexandria – they made money. People noticed. 

# Pay What You Want

In October 2007 Radiohead released their seventh album “In Rainbows”, online, for any amount at DRM-free MP3s. They’d found themselves in a novel part of their career free from the encumbrance of a traditional record deal and buoyed by the high profile a previously successful career as a major label recording artist afforded. 

In December of the same year, they released a series of expanded physical formats and the download was removed.

Reaction was mixed. While Radiohead didn’t invent the “pay what you want” business model, they were the largest artist (by several orders of magnitude) to adopt it and bring it into the mainstream. Trent Reznor of Nine Inch Nails was critical of it not going far enough (arguing the low-quality digital release was a promotional tool for more expensive deluxe editions) while scores of artists criticised the move as an exceptionally wealthy band devaluing the worth of music.

Trent Reznor would go on to produce the Saul Williams third album “The Inevitable Rise and Liberation of NiggyTardust!” – which Williams and Reznor released as high-quality audio audio files for “Pay What You Want or $5”. In the two months from its release, Tardust! Shifted around 30k paying copies, out of ~150k downloads, this compared favourably to Williams’ debut album, which had shifted 30k copies in the previous 3 years.

Reznor would later go on to release two of his own albums, Ghosts I-IV and The Slip, under similar schemes, and licensed under the Creative Commons license, complete with deluxe physical releases. 

While it’s clear that the Pay What You Want model was prolific for these particular bands, much of the criticism centred around the model being entirely untenable for artists without the prior success of Radiohead or Reznor. The benefit of privilege of success under a previous regime.

The record industry didn’t react either in kind, or kindly. Prices remained at an all-time high.
In this same time window, a somewhat blunt Reznor addressed crowds in Australia during a show to express his dissatisfaction with the value placed on music.

      “I woke up this morning and I forgot where I was for a minute.

      I remembered the last time I was here; I was doing a lot of complaining at the prices 
      of CDs down here. That story got picked up, and got carried all around the world, and
      now my record label all around the world hates me because I yelled at the and called
      them out for being greedy fucking assholes.

      I didn’t get a chance to check, has the price come down at all?

      You know what that means? Steal it. Steal away. Steal and steal and steal some more
      and give it to all your friends. 

      Because one way or another these motherfuckers are going to realise, they’re
      ripping people off and that’s not right.” 

Curt, but the tide was certainly shifting against the high price of physical media at the end of the 00’s. Reznor re-started his own label around this time to release his own work.
 
# A Model for The Rest of Us

The 2000s were not kind to Peer to Peer file sharing services. Apple and Amazon both had DRM powered music storefronts, along with also-rans, and the launch of the iPod in 2001 monopolised paid-for digital downloads, normalised DRM to consumers of music, and saved Apple as a company.

As these more closed ecosystems gave the record industry exactly what they were looking for. The ability to charge the same amount, while enjoying the comparative low cost of digital distribution. Peer to peer had been pushed underground by litigation returning to the warez scene subcultures from where it came, thanks to lobby groups and the rise of film piracy pushing for crackdowns on file-sharing, and especially popular mainstream BitTorrent sites like The Pirate Bay.
Several high-profile lawsuits and prison sentences did well for scaring people away from “downloading” pirated music. The industry didn’t recover, but it did see hope.

Towards the end of the 2000s, streaming audio services and web-radio started their rise, along with the founding of companies like Spotify that offered a different model for music consumption. Not only was it a model that worked for the record companies because nobody ever really owned any of the music they were streaming, but it worked for people by passing the tolerance test of “seemingly more convenient than the thing it replaced”.

Tired of loading new songs onto your iPod? Spotify!

Don’t even have an iPod or MP3 player anymore because 4G and smartphones were now ubiquitous? Spotify!

Spotify was so convenient, and so useful, it steamrolled across everything that came before it. Its free mode was ad supported, and sure, the labels weren’t making as much money as they were making before, but it sure beat having some kids upload the albums you published to YouTube and benefiting from the ad revenue.

In Spotify, the labels found the same thing that the videogame industry found in Valves Steam platform – a form of DRM that regular consumers didn’t feel threatened by. That didn’t seem like it infringed on anything. That didn’t feel like it was a threat, or punitive. A far cry from the MPAA and the BPI pressuring ISPs to release information of their consumers so they could litigate against them.

If anything, Spotify is too good. It has competitors in 2019, but none of them are especially credible. Apple Music (which early Pay What You Want proponent Trent Reznor ended up working on for a time), Amazon, and briefly Microsoft all offered competitors – but Spotify and it’s reach, discovery algorithms and passive social features out-stepped the competition. It has a vice like grip on the streaming industry, much like Apple’s iTunes did on DRM’d digital sales previously.

The nature of music has also shifted significantly in the two decades of the mainstream internet.
Lars was right.

We normalised the fact that music wasn’t worth anything, and the cracks are now showing around the whole ecosystem that supports music. Bands don’t break big anymore, music is diverse, interesting, challenging, infinitely broad, and infinitely shallow.

You like Mexican Hip Hop mixed with Deathcore? We got that. How about Indian Rap Metal? Christopher Lee singing power metal? Yes, that exists too.

Low cost and high-quality recording equipment have made the production of music accessible to an entire generation, at the same time as the global economic downturn saw the closure of music venues across the UK. Never has something so creatively healthy felt so continuously threatened by extinction.

Spotify exacerbate this problem with a steady stream of controversies regarding the allegedly low renumeration of artists streaming on their platform. You can’t really find any solid numbers on what Spotify pay artist other than the consensus that “it’s not enough”. Songwriters doubly so – the co-writer of the Bon Jovi song Livin’ on a Prayer, in 2018, for half a billion streams, received $6,000 in royalties from Spotify. Several high-profile artists have pulled catalogues from Spotify, only to later re-emerge (presumably because you cannot fight technological change, but also, because money). 

It doesn’t take much to do the back of envelope maths with numbers like that, and they don’t look good. I don’t work in the music business, but I know a lot of people that do, and the stories are all consistent. Living as a touring musician in 2019 is a harder life than it’s ever been before.

No art without patronage.

When you’re young, you just want to have people hear your music, to play shows, to be a Rockstar. None of those things pay a mortgage.

# Begging to play?

What have artists, bands even done to cope with this existence?

We’ve seen crowdfunding experiments – some successful, some not. Meet and greets, on-tour-lessons, signing sessions, expanded editions, hang-outs, VIP experiences, the works. There’s plenty of good in all those things, but it’s impossible to not identify all of these things for what they are – making artists work extra to somehow justify the value of their art.

Art has value. Value is not cost. These two things should not be accidentally conflated. We started off with “the work” as having value, which was slowly shifted to the live performance. The live performances value was slowly shifted to the merchandise, begetting the slow productisation of art. When we push art into the purely commercial it can’t help but be compromised.

The financial models behind streaming music are compromised. Technology has ascended to occupy the place the record labels once were, with Spotify and other infrastructure companies being the bodies that profit the most.

I run a software company for a living, I speak for, and advocate for technology because I care deeply about it, but there’s certainly something tragically wrong here, even if it’s the simple answer that Spotify subscriptions are too cheap.

# What about the Underground?

I’ve only really hinted at my own personal tastes throughout this piece, music is subjective. But the underground, the small labels, I fear deeply for in this climate.

I fear for the small labels for the discovery capabilities – in niche genres, labels are important, grass roots shows are important.

I grew up discovering music from soundtracks, from the second-hand CD shops in Manchester where you could buy music journalists discarded promos for £3-5 a CD. I’d go down on Saturday mornings with friends and we’d buy 4-5 albums a week. We’d take chances. We’d buy things based on the descriptions and the sound-alikes and the artwork.

It was culture, and culture shifts. The internet has been nothing but incredible for music discovery and access, and has replicated and bettered the experiences I had digesting weird metal albums on Saturday afternoons over the last decade – but in doing so, it’s also completely conflated the concept of ownership with that of access.

It’s no shock to anyone that you don’t own the music you listen to on streaming services, but the more none-mainstream you get, the greater the risk you’re running to lose access to that music in its entirety.

We’ve seen how easy it is for records to disappear from Spotify at the behest of their owners, but what happens when the owners go bankrupt? When the labels go out of business?

What happens when nobody owned the thing they’ve been enjoying, and it vanishes?

The games industry has long been contending with a similar category of problem with the way it treats abandonware (games out of copyright where the authors and publishers no longer exist) and video game emulation.

Games stuck in licensing hell have routinely vanished or become unplayable. We shouldn’t let our own culture erode and disappear. 

We’ve slowly killed ownership, we’re slowly killing our DIY scenes by closing live venues, and we’re exposing music that has been created in our scenes and undergrounds, across every genre that isn’t mainstream, but outsourcing ownership to privately owned organisations that hardly pay the creators of the art we covet. Culture and art should not be kept behind the gates of collectors, and inflated prices.

The music business is lucky, but not without its tragedies – the UMG media archive famously burnt down, losing original recordings and masters of some of the most important albums in history.

The British Library, thankfully, cares about this. 

The “Sound and Moving Image” archive is vast and more varied than you might imagine – their stated aim is to collect a copy of each commercial release in the UK, of any and all genres. There’s no budget, and the rely on donations from labels and artists, along with private collections. The more esoteric “sounds” are digitised, but for most of the popular recordings, you’ll have to go in person to listen for free.

I fundamentally believe in the value of digital distribution and streaming platforms. They’ve opened the walls of music up, but as a community we need to be better at protecting our culture and music – because private organisations owe us nothing and are not always good actors.

Metallica were right about Napster. Let’s protect music, especially outside of the mainstream.

And go to a show!