Music streaming service
[1] Streaming services saw a significant pace of growth during the 2010s, overtaking digital downloading as the largest source of revenue in the United States music industry in 2015,[2] and accounting for a majority since 2016.
[6] On the contrary, streaming has also been criticized by some artists for making them earn less from their music and artistry compared to physical formats, especially with pay-per-stream systems.
[11][12][13] In 1999, MP3.com offered a service known as Beam-It,[14] allowing users to rip and upload music from CDs they owned into a personal library they could stream via their accounts.
[20][21] Pandora initially operated within the royalty framework enforced by SoundExchange for internet radio in the United States, resulting in operational limitations:[22][23] users could not choose individual songs to play on-demand, and could only skip a limited number of songs per-hour (although users could later receive more skips by watching video advertisements).
[33] In 2006, Swedish businessman Daniel Ek and Martin Lorentzon founded Spotify, which first launched in 2008; aiming to create a legal alternative to file sharing platforms such as Napster and Kazaa, the service allowed users to stream songs on-demand using peer-to-peer technology, and would be offered in subscription-based and ad-supported tiers.
Spotify officially launched in the United States in 2011, and Billboard began to increasingly include streams into the methodologies of its record charts.
[33] "Harlem Shake"—a song by trap producer Baauer that had become associated with a viral dance meme—was boosted to number-one on the Billboard Hot 100 chart in February 2013 after U.S. YouTube views for music content were added to its methodology.
[49][33] Tidal, a streaming service oriented towards high-fidelity audio, also emerged in 2015, with backing from rapper Jay-Z, and a focus on exclusive content.
[55] In 2017, Pandora launched a "Premium" tier, which features an on-demand service more in line with its competitors, while still leveraging its existing recommendation engine and manual curation.
[5] Music streaming services have faced criticism over the amount of royalties they distribute, including accusations that they do not fairly compensate musicians and songwriters.
Music Week editor Tim Ingham commented that while the figure may "initially seem alarming," he noted: "Unlike buying a CD or download, streaming is not a one-off payment.
Hundreds of millions of streams of tracks are happening every day, which quickly multiplies the potential revenues on offer – and is a constant long-term source of income for artists.
"[72] Amidst those rising number of streams, Spotify has also confirmed that they will require tracks "to get a minimum of 1,000 listens every year to receive royalties" starting early 2024.
[78][79] Spotify had begun to increasingly make investments into podcasts, buoyed by acquisitions such as sports publication The Ringer and exclusive rights to The Joe Rogan Experience.
[86][87] In 2016, the GfK Entertainment charts in Germany also added streaming to its methodology; however, the metric is based on revenues generated from a song's availability on paid platforms only, thus excluding free ad-supported services.
