Want access to all music as soon as it comes out? Get ready to pay up.
A new licensing agreement between Spotify and an organization that presents some 20,000 indie labels contains an new provision called “windowing,” something the movie industry has been using for years.
When a film is released, it stays in theatres for a certain amount of time. From there, it moves to on-demand, airline entertainment systems and hotel rooms. After that, it gets released on DVD and shown on premium cable TV channels before moving to Netflix and finally network TV and basic cable. Each of those steps is called a window.
By contrast, a new album gets released physically, as a downloadable digital file and to all levels of streaming music services simultaneously. The fact that we can access a new album on the free tier of a streaming service like Spotify greatly annoys labels, artists and managers. They’ve long been yelling for a window whereby the release is only available on the paid level of Spotify (or whomever).
Last Thursday in front of a packed house at Canadian Music Week, I spoke with Scott Borchetta, the founder of Big Machine and Taylor Swift’s manager. He was adamant that some music is worth more than other music. If an in-demand superstar like Tay-Tay (or Drake or The Weeknd or Adele, etc.) releases a new record, then it should be assigned a higher market value than a release by a brand new indie artist and therefore be restricted to those listeners who actually pay for their streaming. To underscore his point, he wore a jacket with the words “Music Has Value” on the sleeve.
We seem to be moving inexorably in that direction. Spotify has a new licensing agreement with Universal to provide a two-week window on specific releases. And like I said, Merlin has hammered out the same deal for its clients. The other majors, Sony and Warner, are sure to follow.
The whole purpose, obviously, is to get more people to pay for streaming, thereby ensuring (a) better payouts for artists; (b) people begin to understand that music should cost something; and (c) that Spotify and other streamers will survive financially. Given the revenue labels are now deriving from streaming, the concept is now officially too big to fail.
Read more here.