Streaming, stealing: what's the difference?

On February 1st last year, a Spotify user streamed a track, Tetrishead, by the California-based cellist and composer Zoë Keating. For this, Spotify paid Keating $0.00185288. This was not a mistake. Keating, who makes arresting music, is not a big star, but she gets a lot of play on official, paid-for streaming sites. In the first half of last year, her tracks were streamed 1.5 million times on the internet radio service Pandora and, over the course of the year, 131,000 times on Spotify.

Keating put all her royalty statements for the first half of last year on her Tumblr blog. They show that she earned $1,652, or €1,232, from Pandora and $547, or €408, from Spotify. There are no missing zeros here: 1.5 million-plus streamings really do earn the artist significantly less than €2,000. According to the New York Times, Spotify pays between 0.5 and 0.7 cents for a play on its paid service and generally around a tenth of that on its free service.

Keating isn’t complaining about the depredations of the internet. On the contrary, she stresses that she couldn’t function as she does – as an independent musician with no record label – without it. She doesn’t want to be a rock star. Online connections with those who appreciate her work mean that she sells music through iTunes and that people pay to see her play live. “It takes a lot of work, but I can support my family on music, take them with me on tour and don’t worry much about money.”

The statements she posted show her earning $82,651 in the same period from download sales through iTunes, Amazon and Bandcamp, so she’s doing okay. And that’s a great thing: the artist can be “successful” without having a private jet.

This, however, does not change a basic fact: a musician is being paid often less than two-tenths of a cent, and no more than seven-tenths of a cent, each time a track is streamed. In any line of work, there’s a word for this: exploitation. Streaming services are businesses, and artists are their suppliers. Those businesses are increasingly lucrative: Pandora has a market capitalisation of $2 billion; Spotify is reportedly valued at $3 billion.

And while all of this looks cool and creative and clean and high tech, this business model looks very dirty and old fashioned. It’s the model of the monopoly employer who could pay starvation wages because the serfs had no real choice but to accept them.

But something even more insidious is at work here. It’s not just the businesses like Spotify and Pandora that are using the work of artists and paying them next to nothing. The real exploitation is being done by the listener. The economics of online consumption of art are brutally simple, and they’re driven by the consumers: the alternative to “next to nothing” is nothing at all. Let us stream your work for a very low price or we’ll just consume it for free.