Does spotify help us in selling our music?
Economists Luis Aguiar and Joel Waldfogel looked at music sales in countries Spotify operated in between 2013 and 2015, and concluded that: “Spotify use displaces permanent downloads” — that is, if you’re getting your music from Spotify, you don’t need to buy it from iTunes. But they also found that “Spotify displaces music piracy,” and that the two trends balance each other out: “Interactive streaming appears to be revenue-neutral for the recorded music industry.”
The nice thing about the study is that it manages to bolster both Spotify’s main argument to the music industry for the past few years — if you don’t let us distribute your music, and get some money for it, the pirates will do it and you’ll get none — and the music labels’ primary worry about streaming — there’s no way we’re going to sell enough subscriptions to replace albums and single-track sales!
The study is also timely, since the labels and Spotify are haggling over new distribution contracts — and YouTube, the world’s biggest digital music service, is about to do the same. Then again, there’s only so much haggling each side can do: The streaming services need the labels’ stuff to exist, but the labels need the streaming services, too — there’s no way they’re convincing people to buy downloads anymore.
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