Today, an interesting idea occurred to me as a result of a major change that RIAA made to their process. The RIAA is the Recording Industry Association of America, and their job is to certify albums and singles either gold or platinum. In the past, certifications were granted based on sales alone- 500,000 sales meant gold and 1,000,000 meant platinum. But recently, they began to incorporate streaming into the formula used to certify. Many people were outraged; now, even if an album has sold as much as 300,000 short of what used to earn it a gold certification, it can still earn a gold certification so long as it has been streamed enough to make up for those 300,000 sales. While this is true, others argued that streaming is the future, and sales alone are simply not an accurate measure of what music is popular because people buy music much less often than they stream it.
So, I was stuck for a long time trying to form an opinion on the issue, until I realized something. People do not stream because of convenience; if anything, listening to purchased music is easier. People stream because it is free or only $10 a month.
In the old days before streaming, such as the year 2000. Let’s say in the span of one week, 1,000,000 people buy an album in the year 2000, meaning no one has the option of streaming it. Let’s say 200,00 of those people bought the album, listened to it once, hated it, and never listened to it again, whereas 800,000 bought the album, listened to it, loved it, and played it three times a day everyday for 3 months. Whether you hated the album or decided it was your favorite album, your purchase still counts for one sale- no more, no less. And, your sale never goes away. Even if you hated the album, your purchase still counts towards the album’s certification, and the album still sits in your iTunes library, untouched. Then, however, those 800,000 people will continue to listen to the album because they loved it, but they will be using their iTunes library to listen, which means it is not documented by RIAA.
In the year 2016, this would be different. Let’s say in the span of one week only, 1,000,000 people stream a new album because they want to give it a chance without spending money on it. 200,000 people listen to it on Spotify, hate it, and never listen to it again, and 800,000 people listen to it, love it, and listen to it three times a day everyday for 3 months. That first week, it is the same outcome as in 2000: each stream is equivalent to the same amount whether you hated the album or not. However, the next week, the album only gets 800,000 streams because those 200,000 people from the first week did not want to listen to it again; those 200,000 never have to contribute to the album’s success ever again. But, those 800,000 people that loved it, will continue to contribute to the album’s success, because they want to listen to the album again, and will use Spotify to do so, and when Spotify is used as the method of consuming music, it is counted, unlike in 2000 when listening to the album in your iTunes library (which is not counted) was the only way to consume the album in full. Every week, even though that amount of people, 800,000, never increases (for argument's sake), their consumption will still be counted over and over again, as many times as they stream the album, which is so easy to do when streaming is free.
Based on this complex, admittedly confusing thought process, I came up with an idea to solve this problem while still keeping music free and accessible, but more accurately measuring its consumption: Spotify and all other major streaming services should not let you listen to an album until it asks the user something along the lines of, “Do you wish to listen to this album?” with a “Yes” button underneath it. Clicking the “Yes” button would do a few things. Firstly, it would unlock every song on the album free of charge. Also, it would count as 1 stream for the album to be counted by RIAA and Billboard. Once you click the button, you cannot get rid of it; it is in your Spotify “library” even if you hated it, just like those 200,000 people who theoretically bought an album, decided they didn’t like it, but still had to see it every time they used their iTunes account. Additionally, if you love the album, you can stream it for free as many times as you want, but the only time it will count is when you clicked the “Yes” button. That way, there is an accurate measure of how many individual people like the album.
Sorry for the long explanation, but hopefully Spotify can implement something like this! It would be a huge step forward for the music industry.
Hi @nicolew and thanks for your thoughtful contribution! Your point is well taken that the streaming model measures consumption differently than conventional retail did. Unfortunately, what you suggest – that users in effect 'buy' albums via their subscription, which translates to a one-off royalty transaction – is not implementable, as the global licensing agreements (and also copyright laws regarding streaming music) require that Spotify pay out a royalty each time a song is released, and that's not something Spotify can circumvent. You might be interested in reading more about how Spotify compensates rightsholders here. Thanks! :)