Five ways Taylor Swift is changing the way the music industry works

Taylor Swift is mad. And like a lot of other commercial artists, she's mad at Apple.

The device manufacturer-cum-music distributor is launching a new music service and users will be able to download music for free for the first three months. You can guess the knock-on effect. Apple had said that as a result it won't pay royalties on the downloads made in the first three months.

Despite Apple Music committing to a higher royalty rate after those three months, many in the industry felt this was exploitative. But while those might not have been heard, Swift has social media platforms she is prepared to use!

Unsurprisingly, her open letter on Tumblr created an immediate stir.

It's important at this stage to distinguish between free streaming (like Pandora and ad-supported Spotify) and paid, subscription-based streaming. Payouts for the former tend to be far lower - one of Swift’s criticisms against the proposed Apple service.

Craig Wilson, Managing Editor at Stuff Magazine, makes the point that with one of the biggest selling albums of last year under her belt and nearly 60 million twitter followers - Swift has become an influential force on the music scene!

If you are potentially losing millions of tracks and your competitors would be able to offer them, that puts you on the back foot before you've even really gotten started.

Craig Wilson,

WARNING FLAG - Swift had previously shown she is a woman of her word. She wanted to only have her music offered to paying subscribers. When Spotify refused her, she pulled her entire catalogue!

It's no wonder Apple Music recanted on their plans...

Taylor Swift featured on the cover of Time Magazine at the end of last year

5 Ways Taylor Swift is making waves, according to Craig Wilson

1.Increasing awareness of streaming and making us question the model Swift pulling her latest album from Spotify last November shone a spotlight on the streaming model and how artists are compensated. Though Swift’s argument that artists aren’t paid enough may well be because of major record labels’ deals with streaming services, not the streaming services themselves. Big labels keep the lion’s share of revenue from streaming rather than paying it to artists. (Cf. Cory Doctorow - Information doesn’t want to be free)

2.Reminding us that streaming services are nascent and the rules are still beingwritten iTunes once dominated digital music sales, now Spotify dominates streaming. Apple Music is Apple trying to play catch up and it’s original plan to not pay artists amounted to it asking artists to take the risk while it acquired customers in exchange for the promise of revenue down the line. Swift said no. Independents said no. And Apple backed down. Indie labels can still help shape streaming.

3.Taking fan engagement to new heights Like Amanda Palmer, Swift has created an incredibly loyal fan base by interacting with it directly using her social media platforms. In an age of excessive content vying for out attention, one deeply loyal fan can trump legion half-hearted ones, particularly in terms of long-term spend.

4.Without musicians and their collective output there is no industry It wasn’t only Swift who grumbled about Apple’s plans, myriad indie labels like Beggars in the UK had protested, too, but none had Swift’s clout. And while not having one of the biggest albums of the year at launch would’ve been annoying for Apple, not having millions of other tracks could’ve made Apple Music dead on arrival.

5.Reminding us that the biggest threat to music industry revenues remains YouTube YouTube is where the young consume music. Aside from bandwidth costs, it’s free. That makes YouTube a bigger threat to the music industry than piracy, and a potential threat to streaming services that rely on convenience being enough of a drawcard to attract a nominal monthly fee. But free is still better and the young, in particular, can’t realistically be expected to resist.

Listen to Craig's chat with Bruce Whitfield...

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