A new iTunes streaming service could be a disaster for songwriters
Two rumours in short succession have hinted that the digital music scene is moving firmly away from the buy-to-own (or rather, pay-to-permanently-license-with-terms-just-short-of-ownership) model – of iTunes, the Amazon MP3 Store and Bandcamp – towards the model which services like Spotify and its American competitors Pandora and Rdio use, where users pay a monthly fee for unlimited access to music.
The Telegraph reports that the BBC is considering launching an iPlayer-style service to make its archive available:
The service, dubbed Playlister, will give licence-fee payers free access to hundreds of thousands of music recordings without paying any additional fees.
The BBC has talked about the idea of making its vast archive of music recordings public in the past, but has always run into trouble clearing the rights.
However, it is understood to be in talks with Spotify and similar music services, such as the French-run Deezer and Apple’s iTunes music store in an effort to side-step the problem.
Those services have already signed bulk rights deals with music labels, who opt in because they would prefer to make some money from the online streaming service rather than watch the shift to digital formats obliterate their sales altogether.
Last month, the Wall Street Journal reported that Apple is planning a similar streaming music service:
Apple Inc. is in talks to license music for a custom-radio service similar to the popular one operated by Pandora Media Inc., according to people familiar with the matter, in what would be a bid by the hardware maker to expand its dominance in online music.
Apple’s service would work on its sprawling hardware family, including the iPhone, iPads and Mac computers, and possibly on PCs running Microsoft Corp.’s Windows operating system, according to one of these people. It would not work on smartphones and tablets running Google Inc.’s Android operating system, this person added, highlighting the mounting battle for mobile dominance between the two technology giants.
This second type of service is possible because the licensing required to do it is less like a sale, and more like running a radio station. In the US, for instance, services like Pandora are required to have a cap on how frequently any one user can play any one song, to encourage people to buy songs they particularly want to play.
But as an interesting post at Digital Music News, from attorney Steve Gordon, argues, one of the most important differences between the two types of license is that in the radio-style licenses, songwriters are increasingly struggling to get any payment at all:
If Apple wants to launch their much anticipated, Pandora-like music service, they must negotiate directly with Sony/ATV for public performance rights. That's the word on the street, and if true, a dangerous turn of events. The reason is that until recently, performing rights organizations – ASCAP, BMI and SESAC (the "PROs") – offered blanket licenses on behalf of almost all the publishers, including all the majors. This dramatically changes that, with negative repercussions for songwriters.
In other words, just because you might get your music legally these days, don't think that the creators themselves are out of hot water.