Social networking site MySpace jumped into the music industry recently, setting up deals with the major labels to stream free music to the users of the site. The news I read yesterday stated that in only the first week, over 1 billion songs were streamed. The commentators seem to view this as a monumental feat, despite the fact that a) they’re free, b) there’s millions and millions of users on MySpace and c) they’re instantly and readily available. In fact, the majority of the press I saw yesterday centered around the idea that this was a sort of challenge to Apple’s iTunes.
Let’s be clear. Streaming music that is paid for by advertising is not the same as music sales. The record labels may use the income from the deals to pad their sales/income numbers, but a streamed song does not a music purchase make. The purpose of the move from CD to mp3 rather than CD to stream is that people like owning their music, taking their music around with them and playing it for others. The stream is great as a form of promotion and introduction to the music, but you can’t take it with you.
This isn’t to say that I’m against streaming music in any way. Pandora is pretty genius, and I would never knock my old home, USC’s streaming radio station that can be found at KSCR. But for industry writers, who in some part can help influence the record execs that read their work, starting to compare a free streaming music service on a social networking site to the largest music retailer in Apple’s iTunes is like comparing tap water to wine. Just because it’s free and easily accessible doesn’t mean that it can trump the demand for quality and the ability to save something far into the future. Of course, if users find a way to “bottle” the stream to their music library, how interested in continued streaming would the labels be?
As for where this turns the music industry, I think the only answer everyone has for sure is that no one has any answers. The labels are still looking to make money off of solid media sales, as mentioned previously, data companies like SanDisk are looking for ways to make albums smaller and more accessible, and artists are still trying to figure out how the industry would work without them given that they only make 9.1 cents from a song royalty, but there’s no money for the labels if they don’t have the song to exploit in the first place.
So for now, we watch. I’m sure it won’t take long for MySpace to surpass 5 billion streams, but how the labels will react to that and attempt to use it to influence other sectors of the music industry will be interesting to see.