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As internet radio site Pandora and online audio distributor SoundCloud make deals that grant more royalties to artists played on their sites, the tightrope online music distributors walk between artists, labels and their users becomes more defined.
In 1999, the music industry changed forever with the invention of Napster, an Internet service that allowed users to share and download music for free, the San Francisco Gate reported back in 2002. While the invention was revolutionary for users, who were able to access difficult-to-find tracks and share their musical passions with users everywhere, the sharing of music was devastating for songwriters and record labels, who were getting nothing as their songs were shared. As a result, the first version of Napster was sued for numerous cases of copyright infringement, and due to their inability to control the music shared on their site, eventually had to shut down.
Despite its short existence, Napster inspired both new copyright laws and copycat music sharing websites. Today, it is almost impossible to imagine listening to all your music from CDs or the radio without digital platforms such as Pandora or YouTube supplementing them. And while sites are finding better ways to negotiate copyright issues, the issues are in no way solved. For example, earlier this year, Pandora was charged with copyright infringement for playing songs from before 1972.
Similarly, the online distribution platform SoundCloud has faced copyright issues for mash-ups and other content on their site. Known for allowing people to upload and stream content for free, musicians often get their start by sharing their music with the website’s 175 million monthly listeners, reports the New York Times. However, the site has had copyright infringement issues, with DJs having their music pulled off the site because it contained copyrighted songs.
The struggle to make record labels and artists happy is a struggle that is ongoing for digital platforms like Pandora and SoundCloud. On Aug. 21, SoundCloud announced a plan for the monetization of their site, proposing that ads will be added to the user’s experience, creating revenue for artists. Earlier in the same month, Pandora made a deal with independent label group Merlin, opening up lines of communication between the internet radio company and artists after years of contention over royalties.
Through these deals, there are numerous benefits for both the Internet companies and the artists. Through their negotiations with labels, SoundCloud could gain security from lawsuits over past copyright infringement while record labels, and more importantly, their artists, gain financial recognition for the work that they have done.
For Pandora, this deal with Merlin, a group that represents more than 200,000 independent labels, notes the Associated Press, not only reinforces a positive relationship between the artist and internet platform, but will also allow Merlin artists the opportunity to ask for spots earlier in playlists and for access to user’s data.
Still, there is yet another ball in the air for digital music providers to juggle and that is the desires of the listeners. That artists should receive their dues is a given and is certainly worth a SoundCloud user (or Pandora user for that matter) having to listen to a few advertisements. Furthermore, these advertisements can lower costs for users who are paying for premium service, creating at least one benefit for them.
However, for SoundCloud there is the concern that audience members used to ad-free listening will be alienated by the removal of one of SoundCloud’s most unique characteristics. SoundCloud is celebrated for being a free music source. While there will still be a free component of it, with this new monetization plan, even those users who aren’t paying for premium service are paying through advertisements, a very different sort of arrangement for users.
There are further concerns when it comes to Pandora’s deal with Merlin. While it's wonderful that the historically tense relationships between artists and Pandora are easing, for the users themselves, this deal has implications. Pandora is founded with the Music Genome Project at its base. With artists now having the power to lobby for their songs to be placed at different locations in a playlist, politics have (to an extent) been added into a mix that before was all about creating the user’s optimal musical experience.
Furthermore, while the data Merlin takes from Pandora about its users will most likely simply help artists and labels know the demographics of their audience, it is still data that is, in a way, being sold. In an age where data is becoming progressively recognized for its value, that is a real sacrifice that Pandora is asking of its users, on top of the ones that users have already made listening to ads in between songs.
Now, these concerns might seem over-dramatic. Who cares that SoundCloud has a monetization plan, or that Pandora made a deal with the Merlin group? Good for them, that these big digital music distributors are finally looking out for the artist. And it is good that people are looking out for the artists, because without the artists there would be nothing for the fan to listen to in the first place.
However, these sorts of deals have effects and though these are only partnerships that are meant to create more revenue for the artists, it is a slippery slope. How far can digital distributors and the artists that are played on them push their fans until fans simply turn away? How many commercials are too many? Already, on Pandora, it can feel like there are more commercials than songs when you have the free version. How long until users decide that digital music distributors are not worth having to pay $5 or $10 a month or having to listen to that 12th commercial from Carmax?
Music will be around forever. However, if fans feel as if digital music distributors are taking advantage of what was once an amazing experience, then sites like Pandora and SoundCloud may not last quite as long.