Digital Downloading vs. Streaming

BY: Jordan Overton

Over the past decade, consumers have found alternative sources to obtaining their music. Music use to be a physically consumed product, whether it would be vinyl, or physical LP’s and EP’s. When technology became a major part of our lives and with that came ITunes, and Amazon that allowed consumers to digitally download their music of choice. This gave consumers the option to download full-length albums, or single songs that they really enjoyed from an album. Another option created in the past five years has been music streaming. With programs like Spotify, YouTube, Pandora, and now iTunes Radio, consumers can now stream full-length albums, singles, and the like at the push of a button as soon as they are released by the labels. Is this the new-age of music and technology, will owning physical music and downloading be a thing of the past? Has the world stopped buying music, and started streaming?

In a recent article by the New York Times, Ben Sisario writes how the music industry’s real reliance in the past few years has been sales from digital downloading, which is still fairly slow in growth. However, they feature a study that shows a decrease in the sales of those downloads. While the cause is still disputed, part of the loss can be linked back to the introduction and continuous expansion of streaming music. The article discusses the ability for users to stream music wherever they go, and at lower costs. With Spotify, if you decide to become a premium user, gives you access to millions of songs for less than $10 a month. Newly released physical albums, and album downloads typically cost around $10 or a little more (depending on if you get a deluxe copy or not). This means that Spotify premium users gain access to all of this music, both new and old, for less than one full-length album per month. This sounds like an amazing deal for consumers. While it has yet to catch on completely, this is a growing sector within the music industry.

Researchers also believe the cause of the dip in downloads could be due to an increase in Android users. Android phones are not compatible with iTunes, and therefore that is an open market for music consumption. Google play is slow, but profitable way for Android users to download music, but the article has seen that Android users spend less on their music than users with iTunes compatibility. This is where the streaming of music can make its way in and eclipse the idea of downloading music amongst android phones altogether.

This positive, technologically innovative experience is great for us as consumers, but it isn’t necessarily amazing for the music industry. Buying a physical and/or downloaded album or track, is the best thing for a music industry. Artists, writers, producers and labels receive more money from that and in a timely manner. A song that is streamed is not nearly worth the amount of buying a physical song. We’re talking about tenths of a penny at this point. 

Many music industry execs, and artists included are definitely excited about the streaming-age of music, but there are definitely concerns in terms of royalties and when payment is received that is another issue that they are trying to work out. For more information on artists’ royalties and the streaming industry check out this article by The Guardian. In the meantime, they are definitely grateful for streaming music and what it has done for sales. In the New York Times article, Jonathan Lamy, a recording association spokesperson is quoted saying “A variety of access models are collectively generating a healthy amount of revenue for labels and artists, We’ve still got a ways to go, but when you add up revenues from all of these models, in the aggregate, they represent real revenues now and prospects for a bright future.”

Great things are happening in the music industry, and streaming may possibly be the future of the industry. There are new models coming out, with the recent launch of iTunes Radio, Rdio, and the future of Beats Music. I’d like to hear your feedback on what you think about the music industry now. Do you guys prefer physical copies of music or do you like to download your music now? Also, how many of you stream your music as opposed to buying physical copies, or digital downloads? If you do stream your music, why do you stream your music?

I have linked a video on the differences between downloading and streaming media for your convenience.

  http://www.youtube.com/watch?v=10N-vBDW8h0