Out-of-Touch Jay Z and the Tidal Music Streaming Backlash
Rapper Jay Z launched a music streaming service called Tidal in an attempt to compete with Spotify. The service offers a $20 a month Hi-Fi option and $10 for the regular service. Spotify charges $10 for their Premium option ($5 for college students) but also offers a free option that's ad supported. The free version plays ads and comes with restrictions on mobile devices.
It's this free option that's led to controversy. Spotify is often criticized for paying too little despite the fact that the company pays out 70% of earnings to artists and labels. Jay Z wants to change that and insists Tidal will pay artists fairly. He claims not offering a free option will lead to higher payouts per stream. In other words, Jay Z wants to force people to pay for music by not offering a free alternative.
The launch of Tidal led to a huge amount of backlash. The biggest mistake was comparing the creation of the service to a social justice movement. Jay Z's wife Beyonce said:
"Every great movement started with a group of people being able to get together and really just make a stand.”
Time Magazine jokingly responded:
"From Seneca Falls, to Selma, to Stonewall, to Los Angeles, where a bunch of celebrities demanded that their fans give them more money—this country has such a rich history of protest movements."
Marina from the group Marina and the Diamonds took issue with the Twitter hashtag #TidalforALL:
"Also, the hashtag #TidalforALL? As if everyone in the world will be getting Tidal for free on our new government music program. Lol"
Spotify has 60 million global users, including 15 million who pay for a subscription. Subscribers pay $10 a month for advertisement free listening. Users can listen to music on or offline. The service offers about 30 million songs. 10 million streams on Spotify would pay roughly $70,000 to labels and artists.
An Interesting Overview of Tidal and Music Streaming
And Jay Z didn't help with out-of-touch comments like this:
People really feel like music is free, but will pay $6 for water. You can drink water free out of the tap, and it’s good water. But they’re OK paying for it. It’s just the mind-set right now.
There's no such thing as free water (is Jay Z unfamiliar with water bills?) and many lower income people who buy water do so because the water supply in their area isn't good. I used to live in an area where brown water would often come out of the tap. A bunch of 1 percenters demanding more money from people who often work long hours but still struggle to make ends meet didn't look good. Of course, there are people who pay for bottled water who don't really need it. And that's obviously the point he was trying to make. But it was a terrible example.
Should People Pay for Music?
Yes they should if they want high quality music. Piracy has made record labels increasingly fearful about innovation and risk taking. Even in genres like classical music labels are so worried about not making a return on their investments that they heavily control what artists can do. Young artists often don't have the kinds of artistic freedom their predecessors enjoyed. They're forced to follow trends because labels want to play it safe. You often get what you pay for. And if you want to pay nothing for music, you can't complain if it isn't high quality or if everything on the radio sounds the same.
Still many people can't pay much for music. I grew up in a poor family. I did buy CDs but many of my albums were copies given to me by kids at school. In college, I mainly bought CDs from a store that sold used CDs. The artists and labels made nothing from those purchases. Now I can afford to pay for music and I do. I subscribe to Spotify Premium as well as buying albums I want on CD.
This is a big upside of Spotify's free tier. People who can't afford to buy music can stream it for free and the artists and labels still get paid thanks to ad revenue. Many people have given up piracy in favor of streaming for free on Spotify instead. The downside is that people who can afford to pay will often use the free tier as well. Jay Z is right that people should pay for music if they can afford it. But he seems to ignore the fact many people can't.
It's important to educate people on why paying for music is so important. And many people are starting to understand that stealing music is destroying artistry, putting people out of work and making it increasingly difficult for indie labels and artists to survive. Artists and labels will have no incentive to pay to make music if they can't get their investment back. Increasing numbers of people are willing to pay for music. Many Spotify subscribers move from the free to paying tiers.
And this is the big problem with Tidal. If you don't offer a free ad supported tier, many people will choose to download illegally instead. It's too easy to do. Tidal won't solve the piracy problem. And it may not solve the payout problem either. The lack of a free tier means fewer people will use Tidal. Since payouts are based on the number of streams for each song, fewer people streaming means fewer streams. Fewer streams means artists and record labels make less money.
However, a more expensive Hi-Fi option may turn out to be a great idea. Many people can easily afford $20 a month to subscribe to music. Getting more money from people who can afford to pay is something Spotify has never tried to do. If more people pay into streaming services, they'll have far more money to pay out to artists and labels. And hopefully we'll get better music in return.