Running Head: TEN DOLLARS A MONTH AND ITS IMPACT

Ten Dollars a Month and its Impact

Kevin Zhou
Florida State University

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From records to cassettes, from CD's to ninety-nine cents per song, the method in which
music is being capitalized is rapidly improving and innovating. That same innovation has led to a
new medium in which songs or music can be listened to and technically purchased through
subscription; music streaming services. A music streaming service is a service that allows a
consumer within that market to listen to nearly any song that the service have to offer. This
concept can be considered an alternative to direct music downloading. With this new service, the
music community has seen a vast number of changes that is altering the culture in which people
listen to music as well as huge changes in the way the music industry interacts with their
consumers. However, with these changes come with arguments; it is now being speculated
whether or not these changes are beneficial to the community and industry as a whole,
financially and culturally. However, with thorough qualitative and quantitative research it is seen
that although the new service does come with faults, when looking at the benefits, the music
community and industry far is better off with Music Streaming Services. This is so because, with
the new service, the music industry is seeing economic improvement. Additionally, with music
streaming services, the music community went through important and essential cultural changes
that benefit both consumers and artists. Lastly, with the introduction of music streaming services
comes the conclusion of arguably one of the biggest issues the music community and industry
faces; music piracy.
Music Industry Financial Analysis
First, when examining how the music industry benefits from this new service, it is easy to
realize that the first thing to consider, being that it is an industry, is knowing how much profit are
they reaping financially from music streaming services. But before looking at the numbers,
Lauren Keating, a writer for Tech Times writes a (2015) article reporting how record labels and

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music streaming services make their deals. Keating explains that each music streaming service
has their own method of pricing and rates. Essentially, because most of the deals happen on the
negotiating table, deals, pricing and contracts remain confidential between the two parties.
However, Keating goes on to report that on a contracted leaked from one of Apple Musics deals,
it is revealed that artists 71.5 percent of its revenue in the U.S. However, it's important to note
that the approximately 70 percent will go to whoever owns the publisher rights to the
recordings In this case, it would be the music label and the contracted publishers (Keating,
2015). Knowing this, it is easy to see that the music industry is reaping the benefits from this
new medium of listening to music. But when looking at the numbers and statistics, Nils Wlmert
of Vienna University and Dominik Papies of the University of Tuebingen gather quantitative data
that proves the music industry is making financial gains from the new service. In their research,
they compare revenues made from free streaming services and, in our case, paid subscription
streaming services. They find that even with market cannibalization or the initial negative impact
of a new product or service on sales, total revenues ended being positive. In their conclusion,
they even note that the music industry should consider the subscription music streaming service
over the free one (Wlmert & Papies, 2015, p. 321-324). When looking at Keatings article and
comparing to Wlmerts and Papies research, a conclusion can easily be made that the music
industry, more specifically, music labels and publishers are gaining a great deal of profit from the
new method of listening to music. In fact, a very familiar company that associates itself with the
realm of music listening through the medium of downloading, Apple, recently made addition to
their monopoly, and their actions are all due to the new concept of music streaming services
(Sisario & Chen, 2015). Ben Sisario and Brian Chen of the New York Times reported this on
their (2015) article when they emphasize that Apple, the technological mogul, is following the

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footsteps of one of the first subscription-based music streaming company Spotify, by creating
their own music streaming service platform. Knowing that Apple, an already successful
company, is rivaling a novice company truly shows the magnitude of profit that the platform of a
music streaming service can have.
Music Community Improvements
When moving on to the effects music streaming services have had on the music
community, its seen that the music community experienced the most change out of the
introduction of the new service. This is first seen through the concept of interface. Interface can
be interpreted or even defined as the relationship or point of contact between a system and a
person. Jeremy Morris of the University of Wisconsin-Madison and Devon Powers of Drexel
University write a journal article in (2015) that gives an overview of the musical experience in
music streaming services that emphasizes this concept. Morris and Powers summarizes that with
these new music streaming platforms come new interfaces, each with a different experience for
consumers. They continue by adding that the goal of these interfaces is to make the consumer
feel good. For example, they listed that Spotify had this goal in mind by making their interface
experience more personalized. They go on and conclude that the main effect that these new
service companies have had on the music community is The shift toward a branded music
experience and how the new focus is driven towards stimulating the listeners relationship to
music in the presentation and curation of that music (Morris & Powers, 2015, p.111-117)
The next effect we see music streaming services have on the music community is a new
effort in branching music to social networking. Mark Glantz writes a Journal Article in (2016)
highlighting the human touch of internet radio and streaming services by reviewing twelve

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different companies specializing in music streaming. Out of those twelve, he reviews how the
company, Grooveshark, followed this innovative trend by creating and incorporating a
community option into their interface. With this option, users can connect their accounts to
social networks to let their friends know what about they are listening too, or what playlists they
have made (Glantz, 2016, p.42-43).

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References
Glantz, M. (2016). Internet radio adopts a human touch: A study of 12 streaming music
services. Journal of Radio & Audio Media, 23(1), 36; 36-49; 49.
Keating, L. (2015, The business of music-streaming services: How deals with record labels and
publishers are made. Tech Times,
Morris, J. W., & Powers, D. (2015). Control, curation and musical experience in streaming music
services. Creative Industries Journal, 8(2), 111-112.
Nils, W., Dominik, P. (2016). On-demand streaming services and music industry revenues
insights from Spotify's market entry.33(2), 316-325.
Sisario, B., & Chen, B. (2015). Apple and beats developing streaming music service to rival
Spotify. New York Times,