Industry Groove – Week 24

There may not be a summer lull in the music industry anymore, but nevertheless, you can still notice that many people are enjoying their summer vacations, festivals dominate the agenda, and some prefer to lounge around in the outdoor pool rather than work overtime. Consequently, this also means that the wheel turns a bit slower and the news is somewhat sparser than in other seasons. However, this short break can’t hurt and provides an opportunity to calmly reflect on the changes that the first half of the year has brought. Or simply to spend more time in the pool. Enjoy the weather!

Universal also wants to involve SoundCloud

• Universal is in search of a new streaming model and has previously partnered with Tidal and Deezer, as reported.
• According to media reports, SoundCloud will now also be seeking the optimal model. Insiders expect the negotiations to be concluded by the end of the year.
• I really hope that, unlike Tidal, SoundCloud will not abandon its user-centric, also known as fan-powered, experiment.
• At this point, I would like to once again refer to the study by Pro Musik, which I already mentioned in Week 19’s newsletter. It examined the user-centric model in 18 countries and concluded that 32.6% of royalties would be redistributed.
• According to their analysis, 29.3% of artists would earn over 40% more with the user-centric model, but 38.8% of all artists would earn over 40% less.
• 19% of artists could double their income under the new model. However, the problem is: twice as much as little is still not really much.
• As long as the pie doesn’t grow, only the slices of the pie are distributed differently. The bottom line? For real change to happen, the pie needs to get bigger.

Meta presents MusicGen

• Recently, numerous new music AI tools have emerged and even the big tech companies are dealing with the topic. After Alphabet (Google) recently released MusicLM, Meta now follows suit with MusicGen.
• By using text commands, users can guide the AI in the desired direction, and it then generates 12-second snippets.
• The AI was trained on 20,000 hours of licensed music (for comparison: MusicLM is based on 280,000 hours of music).
• As evident, both MusicGen and MusicLM are primarily research projects rather than commercially released tools for end users. According to Music Ally, they serve much more as a foundation for start-ups and developers.
• You can try out the tool yourself here. Personally, I am not very impressed so far, and neither are others.

Publishers sue Twitter for $250 million

• Social media platforms and the music industry have traditionally had a somewhat challenging relationship. Undoubtedly, social media is hugely important for musicians and labels. Similarly, the platforms benefit from their presence and, even more so, from the music that their users can utilize. However, there is a dispute about how this usage should be compensated.
• Twitter has proven to be particularly resistant, leading 17 publishing companies to file a lawsuit against the company acquired by Elon Musk.
• These are not just any companies filing the lawsuit; they are major players in the publishing industry such as Concord, Universal Music Publishing Group, BMG Rights Management, Hipgnosis Songs Group, Kobalt Music Publishing, Sony Music Publishing, and Warner Chappell Music.
• In the lawsuit, the publishers make it clear that many of Twitter’s competitors have recognized the need for proper licenses and respect agreements for the use of musical compositions. However, Twitter is guilty of substantial copyright infringement.
• In fact, unlike Instagram, Facebook, or TikTok, Twitter has not signed a licensing agreement with the major music companies. They are no longer tolerating this.

Bonus Reads

• Music Ally has released its latest “Streaming Report” providing detailed and interesting insights into the state of various DSPs (Digital Service Providers). The report examines recent launches by different providers, what sets them apart from the competition, and identifies potential risks. Furthermore, the authors take a glimpse into the future. I would claim it’s a must-read.
  
• The blog BPB conducted a survey on the topic of AI in music among 1,533 producers. Of these, a staggering 73% believe that AI could replace them sooner or later—an astonishingly high number. Despite this existing fear, only 17.3% of the respondents have a negative view of AI, while 47.9% remain neutral. 36.8% of the producers are already using AI tools, mainly in the field of mixing and mastering. You can find all the results here.
  
• Although summer has already arrived, Spotify is still doing some spring cleaning. After numerous layoffs and the discontinuation of Heardle and Spotify Live, the music creation tool SoundTrap is now being sold back to its founders. Spotify had taken a similar approach with SoundBetter in the fall of 2021.
  
• Streaming fraud is a serious problem that negatively impacts many musicians who promote their releases in an honest manner. This is also recognized by various distributors and DSPs such as Spotify and Amazon Music. They have joined forces to form the Music Fights Fraud (MFF) alliance. Instead of each party taking individual measures, the alliance aims to consolidate these efforts. It is a fundamentally good initiative, although it should be noted that the alliance consists of players who, if at all, are only indirectly affected by fraud.