Digital, Music Business — September 26, 2011 at 4:51 pm

Gently down the stream: Why free music streaming isn’t all it’s cracked up to be

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If my mother taught me nothing else, it’s that there’s no such thing as a free lunch. Music is no exception; since the dawn of Napster (and all the other trendy downloading and torrent-based sites that have justifiably been closed down), greedy music-mongers have been desperately searching for an alternative method of gaining access to their favorite tunes, without the inconvenience of breaking the law, or handing over their hard-earned cash. Until recently, sites such as Spotify, Last.fm and (for the traditionalists among us), Myspace, have provided a guilt-free, consequence-free listening environment for millions of users around the globe for most of the last decade. And, why not!? There has to be some good in this world, and free music seems like a pretty good start!

Not according to the corporate partners of some of these companies, or so it would seem. Where there’s money to be made, there will be people trying to make it; and this tendency of human nature is slowly ruining the liberal free-streaming system that we’ve grown to love. Recently, websites such as Mog, founded in California, and Rdio, which operates in the USA and Canada, have found “creative” ways of giving people the music that they want, while ensuring continual returns for corporate investors by limiting access to the music after a certain “tier” has been breached. Which, in a perfect world, would allow people to listen to a select amount of music, while benefitting investors by encouraging users to spend up. But, do these models work?

An unlisted public company in Australia recently launched a model whereby consumers can access music, once they have selected the means by which advertisers pay for the rights to the music in question. By and large, although it is a novel concept, it hasn’t particularly worked. Why? Lack of consumer interest, due to floods of irrelevant advertising (removing from the genuine feel of the site), combined with a lack of functions, such as the highly sought-after recommendation tool (similar to the fabled iTunes Genius, which selects songs you may like based on what you have already heard).

In our minds, it’s simple. Free music streaming is one thing, purchasing tunes for personal use is another. Free streaming does have its’ place; it’s usually endorsed by the artist (especially in the case of Myspace), and it provides people the opportunity to try before they buy (literally. If the song is good enough, it will get sales in the form of digital retailers such as iTunes). However, where free streaming and digital sales begin to collide, a grey area develops, and whether or not the free streaming generation can support investor interest is yet to be ascertained. Watch this space; if someone comes up with a miracle site that can support both consumer and investor interest, we’ll let you know straight off. Until then, pick a side of the fence (either the musical equivalent of a one-night-stand, or a long term relationship at a set financial cost) and stick to it! We did, and we’d share that with you too – but a lady never tells.

By Stephanie Winkler