So, yes, it’s true. Folks who aren’t very popular don’t make much money from the digital markets where it’s necessary to be popular to make money. There’s a certain tautology, roundtripness, to that argument but there it is all the same.
John Harris wants to complain about this. Well, OK. The problem that has to be faced is that we out here, we consumers, aren’t willing to pay very much for our consumption of digital goods. Think on it – the base allegation here is that Spotify et al are money grabbing capitalistic bastards. Well, OK, let’s start with that as an idea. That does mean that if they could charge Spotify consumers more they would. Because they’re money grabbing capitalistic bastards. They don’t because they can’t.
Hmm, a bit of a problem for the idea that niche musos can’t make a living because of the capitalistic money grabbing bastards. It might actually be us out here that’re the problem.
But then Harris goes entirely insane in his economic analysis:
The cultural and media economy of the analogue era, by contrast, worked on the basis of a different model. Whatever their failings, the best of the organisations and companies that kept the show going – from publishers, through record labels, to old-fashioned TV channels – worked on the basis that the mainstream success of their biggest attractions would help subsidise less bankable talent, and also allow adventurous, driven people to take chances. To an extent, this is still the modus operandi of some institutions that have managed the transition from the old world to the new (you’re reading this thanks to one of them). But what is happening elsewhere looks altogether more Darwinian, even if some online giants now want to be seen as generous benefactors – and what’s telling is the way that any big rewards seem to go to stuff that flips into people’s field of vision and then just as quickly disappears.
So, let us think through what is necessary for this to happen. The subsidy of the art house bands by the chart toppers. It is necessary for the record companies – now in this analysis replaced by Spotify et al – to have more control over the revenue flowing through their accounts.
They can only withhold some money from the chart toppers and give it to the artists if they control that cashflow, no?
So Harris’ argument is now that the capitalistic money grabbing bastards must abstract more of the revenue stream to dispose of as they, the capitalistic money grubbing bastards, desire because maybe some of it will be spent upon what the capitalistic money grabbing bastards think might be a good idea.
Which is an excellent example of the logical absurdities you come up with when trying to do economic analysis without having the first clue about economics; Or, possibly, analysis.
The actual answer is that Taylor Swift, who is making all the money in this current arrangement (Spotify never has made a profit), sponsor an art house band or three. Because it’s Taylor Swift who is making all the money so that’s where the money has to come from.