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Spotified: New Age of Music

Tech & biz20 April 2017

By Larasati Oetomo

Spotified: New Age of Music

After continously declining for the past two decades, the music industry reclaims its long-forgotten glory by the end of 2016. Who is the most responsible giant behind that flicker of hope?


The Recording Industry Association of America noted 11.4% profit growth in 2016—the first time music industry ever peaked two-digit growth since late 1990’s. Not even the age of legal download ever been able to grasp the achievement. Long-standing media streaming like Youtube, who is being accused for paying too little for copyrighted pieces, do not even help to raise the sloping sales of music production in the second millennium. For the past few years, people are welcoming the new age of enjoying music through online streaming. Starting up slow for providing free access to commercial music, online music streaming providers attained $3.9 billion last year, making up 51% of total profit in music industry.

The rise of music streaming industry is preceded by the declining trend of digital download. For the past three years, digital track sales’ revenue plunges around 12% each year. Income from physical album also dropped although not as dramatic as digital download—thanks to the rise of vinyl sales. Meanwhile, the cynicism towards streaming business is answered by doubled up paid subscribers to 106.3 million subscribers worldwide in 2016, according to MIDIA research. The number of streamed music also multiplied up to 400 billion songs throughout the year.

Parallel with the restless growth of communication technology including high-speed, open public internet access and gadget advancement, wider audience shifts from conventional music download to music streaming. One of the main reasons is for the wider accessibility provided by music streaming, in comparison to digital download that is limited to single track or album. Most music streaming providers like Spotify and Pandora offers recommended playlist or artists, even for free users. Users can also manage personalized playlist with a huge collection of songs—a system resembling ‘jukebox’ where people can access any song they like without investing too much money.

Dollars to cents do make a difference, eventually. Mere pennies invested on a single stream matters more than dollars invested on permanent purchase of digital download. Online streaming providers finally gain revenue from paid subscribers, exceeding budget to cover up royalty payment. By 2016, online streaming end the deterioration of music industry since 1998. This revolution is without any drawback. Musicians and songwriters must undergo relatively lesser payment for their works as the consequence. This is why some musicians (including Gene Simmons and Adele) claim that online music streaming underappreciate music workers.

Although considerably playing a major part in diminishing music piracy, online music streaming paradoxically creates another type of piracy called stream ripping. As International Federation of Phonographic Industry claimed, around one-third of online streamers still access illegal music. In a way, online music streaming bring fresh air to liven up the industry. It is even predicted to expand its dominance throughout next year. The question lies on how it convinces musicians worldwide without violating their rights, as well as dealing with privacy and legal issues overshadowing its success.