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Mar 1 2023

🔵 So TIDAL's Direct Artist Payout system failed, but is that the death of user-centric payouts?

The latest news from the music and tech industries
Hi there - 

I have seen a fair bit of chatter on social media regarding TIDAL's closure of its Direct Artist Payout (DAP) program, as if this is in some manner a comment on user-centric as a principle.

In reality, I feel this entire system was somewhat flawed in its approach, arguably focusing on the wrong things and potentially missing a lot of wider picture angles on the whole area as well.

It is worth remembering that TIDAL's system (sidenote: seriously, what is it with CAPITAL LETTERS being used for company names now??) was only paying out on the #1 artist a user was listening to. So it was not, in reality, really distributing all that fairly.

Additionally, as Music Ally points out, TIDAL does not represent a significant market share, so the users - in hard numbers - are relatively low.

Given everything I have read from SoundCloud of late, I still feel it might be the company to watch in this space. Welding any user-centric/fan-centric model onto DSPs may never work. Well, not a DSP that looks and operates like Spotify or Apple Music anyway.

SoundCloud is a different beast entirely, and that - to me anyway - is where things might get interesting here. In the grand scheme, it might not provide the solution to the Spotifys of the world, but it may just showcase a new path forward, and if that's all it does, that would be no bad thing.

Let's see though. Your move, SoundCloud!

Have a great evening,

D.


🎶 written whilst listening to Mr Mitch's incredible "Techno Dancehall 3". Keen-eyed subscribers will know I've mentioned this before, but it's a stone cold classic for the ages, so if you didn't heed my word last time, heed it now. A total gem fusing dancehall styles with technoid beats that just BANGS. Enjoy! 
Stories from the Music Industry:
TIDAL will cut direct artist payout program to invest more in emerging artists
The platform, which targets consumers who seek a higher-quality audio experience, introduced a novel direct artist payouts (DAP) program last year. For customers on the $19.99/month HiFi Plus tier, each individual subscriber’s most-listened artist would get 10% of their subscription fee. As it turns out, that plan didn’t work. In April, TIDAL will end the DAP program. “The DAP program focused only on a listener’s #1 artist, which left much, much less room for emerging artists to get paid,” TIDAL CEO Jesse Dorogusker wrote in a Twitter thread today. He said that 70,000 artists were enrolled in the program, but they only paid out $500,000, which was “far short” of TIDAL’s goal.

👆🏻Hot take: to be honest I feel like the whole methodology here was flawed, and as such I don't see it as the damning take on user-centric payouts that some are interpre
Deezer published its latest financial results yesterday, hailing 2022 as a “successful” year on the grounds of a 13% growth in annual revenues to €451m ($480m at current exchange rates). Deezer’s D2C business for direct subscriptions saw its revenues grow by 12.2% to €317.2m, while its B2B business with partners grew by 10.4% to €118.5m. However, not everything is rosy in Deezer’s garden. The company actually saw its subscriber total fall slightly from 9.6 million at the end of 2021 to 9.4 million a year later.

👆🏻Hot take: broadly positive news from Deezer, though I think the stat to watch in future might be how much B2B revenue trends against its B2C business. 
Pairing its short-form video platform with an on-demand service would give TikTok a “significant opportunity” to leverage data and manage customers across multiple platforms, says one of the music industry sources. “Why would they not want to capture that demand themselves?”

👆🏻Hot take: a great overview of TikTok's Australian antics, ultimately questioning why it is doing this when even the likes of YouTube have, ultimately, accepted that it is better to work with rights holders than fight them. 
Previously, 32 of the BBC’s 39 local radio stations helmed their own Introducing show. This will be cut to 20 shows, although the frequency of broadcasts will double to twice a week, “giving up-and-coming musicians a bigger platform and audience than ever before”, the broadcaster said in a statement. Each of the 39 stations will “retain music expertise on site to support the production of the programmes and bring in new talent”, it said, as well as hiring new roles and supporting 11 regional BBC Music apprentices. No date was given for the new changes.

👆🏻Hot take: given the starting point for this issue, with no clarity on just how bad cuts would be, I read this thinking "that's not good, but it could have been much worse". 
The record industry in Germany generated a total of €2.07 billion ($2.17bn) in 2022, which was primarily driven by music streaming. That €2.07 billion revenue figure in 2022 marked growth of 6.1% YoY. BVMI notes that last year’s revenue haul marks the first time in 20 years that the two billion Euro mark had been surpassed for recorded music revenues in Germany. According to the BVMI, the last time this was achieved in the market was in 2002, when Germany’s recorded business generated €2.21 billion.

👆🏻Hot take: great to see this continued growth in Germany. The interesting stat for me? The degree to which CDs still outsold vinyl. 
Stories from the Broader World of Tech:
EC narrows its Apple music-streaming investigation to 'anti-steering' issues
Today’s missive takes the IAP issue off the table: the Commission “does no longer take a position as to the legality of the IAP obligation for the purposes of this antitrust investigation”. The sole focus is now the anti-steering rules, which the Commission concludes “are unfair trading conditions in breach of Article 102 of the Treaty on the Functioning of the European Union”.

👆🏻Hot take: the In App Purchasing issue may now be resolved, but the consequences of Apple losing on the second issue may yet mean significant fines. One to watch. 
Mohan, who was previously the Chief Product Officer at the company, said that the video streaming platform is experimenting with introducing more features for formats like connected TV experience, Shorts, and podcasts. Notably, at a recent event, the company announced that podcasts are coming to YouTube Music with features like background play. 

👆🏻Hot take: I quite like the new pragmatic era of YouTube. Google has an awful history of bad product development, but with YouTube it feels like they're edging towards something genuinely decent. 
Banning a Chinese-owned app from government employee devices isnt a bad idea. The problem remains, as weve noted countless times, that this isnt actually fixing the underlying issue. Namely, our repeated failures on consumer protection, our failure to meaningful regulate the unaccountable data broker market, and our corruption-fueled failure to pass even basic privacy legislation for the internet era.

👆🏻Hot take: agree completely with this article, which reiterates what many have said already. Question is, will anyone heed the warning?
Bluesky, the Twitter alternative backed by Twitter co-founder and CEO Jack Dorsey, has hit the App Store and more testers are gaining access. Though the app is still only available as an invite-only beta, its App Store arrival signals that a public launch could be nearing. 

👆🏻Hot take: curious to see what kind of pick-up this might get once it comes out of its invite-only phase. 
Need something else to read? Here you go:
The maze is in the mouse. What ails Google. And how it can turn…
What ails Google. And how it can turn things around.

👆🏻Hot take: a great look at where Google is getting it wrong, and how it can sort itself out. Well worth a read, not least because I'd argue the points might apply to a lot of other tech giants
To legions of ‘Rick and Morty’ fans, co-creator Roiland was a quirky genius whose career was suddenly derailed by allegations of domestic violence. But to colleagues, his behavior has been troubling for years.

👆🏻Hot take: Roiland's downfall felt depressingly Groundhog Day-ish to me, but here's a solid article on the whole mess. 
Happiness can sometimes feel just out of reach. But having more fun? You've got this — and those giggles and playful moments can make a big difference to your health and well-being.

👆🏻Hot take: a reminder of the value of play, something I think most people take as being of little merit. 
The latest from Motive Unknown:
Jacques Greene's “channelling the feeling of a year spent back in the real world” on his latest offering on LuckyMe. 🎶

Back in fine style for the first time since working with Bonobo with club-focused single ‘Believe’. Always a pleasure to work with LuckyMe on some MU office faves! 😍
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