How We Spend Money On Music Is Changing

93% of the US population listens to music, spending an average of 25 hours a week listening to their favorite songs, according to Nielsen's Music 360 Report.

That said, 2014 provided a paradigm shift in how we consume music, as streaming has now become the preferred method.

In fact, 67% of music fans tap into streaming music on any given week.
Indeed, we streamed more than 164 billion tracks last year alone.

That said, Americans spend an average of $109 a year on music, and you'd be surprised how we spend it.

As you can see from the chart on the left, the majority of the money is spend buying live music tickets, and the next largest sum is buying CDs!

That's followed by buying music gift cards for others, and tickets to music festivals. Paid online streaming is almost last, which means there's big room for growth in the future.

Emily White, David Lowery, And The New Music Paradigm

If you've not been paying attention, there's been a minor furor recently between NPR intern Emily White and Cracker/Camper Von Beethoven frontman David Lowery. To briefly paraphrase the situation, 21 year old White wrote that she has 11,000 songs in her iTunes library yet has only paid for 15 CDs in her life, while Lowery wrote a long reply describing the Music 3.0 world of an artist and songwriter that wanted/needed to be paid.

It should be pointed out that White was lamenting the fact that she wanted to support artists she loved and felt guilty not paying for their music, but the culture of she and her peers dictates that music should be for free, and they rarely feel compelled to pay for it. After all, you can find it for free in so many places already anyway (YouTube, Grooveshark, the various Torrents, to name of few). She's not opposed to a service like Spotify and would love it if she could get anything she wanted, whenever she wanted, with a great portion of the money paid for the service going back to the artist.

Lowery went on and on and on about the problems of the music world today and, in my opinion, more or less missed the point.

This makes me want to arbitrate the conversation from a distance and illustrate where the music business is at today in regards to both consumers and artists/songwriters.

We live in a different musical world today. It's too easy for the consumer to get music for nothing or almost next to nothing. It's a commodity like soybeans, only less vital to our health and the economy. As White stated in her letter, kids don't care about liner notes or fancy packaging or even any packaging at all. They don't see the collectible nature of a vinyl record, cassette, or CD like the previous generations. It's a new ballgame.

That doesn't mean that they love music any less than the previous generations did, nor does it mean that music is any better or worse. Take a look beyond the top 40 (which has always been, for the most part, superficial) and you'll find some amazing acts.

The problem for many old school artists, publishers, and label executives is they can't accept that the paradigm has shifted. All of them want to be paid just like they were before. Who can blame them? It leads to a pretty cool lifestyle when the money flows freely. But those days are over, at least for now, and as far as anyone can tell, they're not coming back any time soon.

Artists and songwriters the world over want to get paid for their work, especially when they gain some measure of visibility. There's no argument that that shouldn't happen (I suffer just as much from a stifled royalty stream as anyone else), but the music creation system as it's constructed today doesn't match the way consumers consume the music they love.

There's no use complaining about it any more. That only pisses people off and it's not helping the situation. Buggy whip makers complained when the automobile hit the scene, as did typewriter manufacturers when computers were taking off. That didn't get them very far as they died a slow death. Adapt or die was never a more appropriate phrase.

I have some interesting thoughts on the things that have and have not changed in our journey from Music 1.0 to Music 3.0 which I'll share in a future post.

Read the Emily White post here, and the David Lowery reply here.

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