Streaming and Curated Playlists for Business Owners

According to the Wall Street Journal, Spotify is about to secure approximately $400m USD in new investments; an indication of the shift towards streaming services over physical CDs or digital downloads.

Streaming revenues have surpassed CD revenues all around the World, and if this trend continues, by 2016 streaming revenues will also surpass digital download revenues (which have been experiencing a steady decline over the last few years).

The industry has embraced streaming as other ways of playing music have faded; as a result, many major companies are investing in the financial future of streaming platforms (e.g. Spotify has already received more than $500m USD in outsider funding since its launch in 2008 alone).

For business owners, streaming services allow managers to play music and create playlists that encourage more in-store spending, brand reinforcement and improvement of company culture. With the addition of predictive streaming and playlist curation services, businesses can now engage with their consumers more efficiently and effectively.

The fact that most major labels now have their own playlist services available, shows the importance the industry is placing on them; trends show that playlists have become a significant way for businesses to engage with their target audiences and express their brands unique personality.

Curated “smart” playlists are where the industry is heading with streaming services. Apple is even allegedly paying music journalists quite handsomely to curate thousands of playlists; this is in anticipation of the re-launch of their on-demand music streaming service later this year.

A few years ago there weren’t many options available to (legally) stream music, now everyone is trying to compete for consumer attention and get a slice of the Streaming Pie. We now have Spotify, Pandora, 8tracks, Guvera, Rdio, iTunes Radio, Jay-Zs new venture, Tidal, and many many more. Punters are spoiled for choice.

As the streaming industry is in its relative infancy, the industry is still trying to figure out systems to ensure artists are paid fairly when their music is streamed. Universal, Sony and Warner are believed to be putting pressure on Spotify (and other streaming platforms) to reduce their free offering to fans as an attempt to try and counter the ’free music’ culture that has emerged since the advent of Napster.

So what about businesses wanting to stream music in their store or at their venue?

Many stores, restaurants and venues understand the importance of playing music in their store as it encourages spending, keeps people in the store for longer and adds to the culture of the company.

Many of the streaming services mentioned (E.G. Spotify or Pandora) are only licensed for personal use in Australia, so you can’t legally play them in your store / venue, even if you have a streaming license from APRA / AMCOS. This is due to the different calculations of royalties: 

A single stream of a song at home is likely to reach an audience of a couple of people. When in a store or at a venue, the audience size is much larger and so the royalty rate needs to be adjusted so the artists are paid fairly.

If your venue/store is found to be using a non-commercial streaming service (like Spotify or Pandora), you could be sent a cease and desist notice, and in some cases, rather severe penalties.

Spotify is currently in the process of developing a version of its service specifically for use in a  business environment; this is still a long way off and will only be available in Sweden initially. Companies in Australia, like Q.SIC, have created direct deals with Major and Independent Labels to provide a legal streaming service for businesses in Australia. These deals were created to ensure artists are being paid correctly and venues/stores can have (legal) access to play the newest song content in their stores.

The whole world of streaming can be very complicated and confusing, especially now when there is so much change occurring in the industry. To discuss a quality music streaming service designed for business use in Australia, call Q.SIC today on 1300 113 279 or visit www.getqsic.com for more info.

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