How The Music Streaming Boom Is Growing: Outlook From SongCast
As the music streaming industry grows, one player is set to show it can overcome major hurdles to make it boom even faster. Distribution platform SongCast says it is making streaming easier for consumers while championing independent music, paying 100% royalties and avoiding clunky paywalls.
The company’s founder and chief executive Mike Wright is sure his model, with no subscription for consumers and no advertising, is the simplest and best way to grow.
His comments come as distribution companies try different methods to monetise the success of streaming kings and queens - from Justin Bieber to Drake, Ed Sheehan to Adele.
Indie artists are also growing as streaming consolidates its position as the driver of music sales. It is now responsible for nearly 60% of all digital revenues, according to the Global Music Report released by the International Federation of the Phonographic Industry.
SongCast has recently launched its own app alongside its longer-standing distribution partnerships with iTunes, Pandora , Spotify, Apple AAPL +0.63% Music, Google GOOGL +0.36% Play, AmazonMP3, Rhapsody, eMusic and MediaNet.
SongCast on a phone
Wright, speaking in an interview, points to the huge potential after ruling out any idea of a paywall for consumers: “That was a big challenge for me in resisting that model. Once you have put up a paywall, you follow with a sign-up form and that slows you down quite a bit.”
Wright also flags up the rise of voice assistants such as Amazon’s Alexa. “We have seen a huge boom in their streaming because of that. It is evolving to the point where you can say what you want to hear and that song will be played.”
The industry has not yet said much about voice control revenues, but streams may well boom as users try it too with Google’s Assistant, Apple’s Siri, Microsoft ’s Cortana or Samsung’s developing Bixby.
Wright, 43, moved into technology after being lead guitarist in progressive band Sustain, whose hard rock was compared to Rush and Yes. Wright was initially rejected when he tried to get the group’s albums Through The Void and Breaking Free onto existing digital services. “They basically said ‘you have to go through a distributor, we just don’t work with independent artists ourselves.’ That left me in the position of becoming a distributor or label myself. I started aggressively seeking other artists. I approached iTunes a few months later with 50 bands. They accepted us, and it just snowballed from there, and now we have 20,000 artists.” Ohio-based SongCast has been going for about 10 years. “We have paid out approximately $24 million in artist royalties from music services such as Spotify and ITunes, with roughly a billion streams and more than 100 million downloads.”
There are of course other distribution services with different models, such as CD Baby and The Orchard, so why should artists go to SongCast to get material on the virtual shelves of Web stores?
Wright replies that with his platform, artists can be on major services within a few days. The first content and month is free. “I cannot see anyone else doing that.” As long the artist is paying a monthly fee of $9.99, there is no annual renewal fee on the album, whereas his competitors will charge both this and a percentage of sales. Therefore an artist can release some 10 products over a year for $120 as opposed to the $600 elsewhere.
SongCast is already working with some familiar names: soft rock band Player; Florida broadcaster Bubba The Love Sponge; and country-rock star Shooter Jennings, son of Waylon Jennings. SongCast may not have true household names yet on the roster, but it hopes to soon. Many of its tracks are by emerging acts looking to be signed to a conventional record company, though some are making enough to live off digital distribution alone.
In December 2016, SongCast added its own curated streaming app, which now boasts some 10,000 users who have streamed more than 300,000 songs. The listeners do not have to pay. They can also listen to artist interviews, check tour dates, send messages to artists and even vote to like or dislike tracks. Users will discover music not heard before, like Tinder for music, with algorithms suggesting something new on every tap of the app. Streaming services are increasingly linking with Internet radio and, in the case of SongCast, $7.99 a month gets a song into radio rotation.
Mike Wright
As the industry grows, there will obviously be consolidations and changes both with distributors and platforms. In the last month, Spotify acquired the team behind block chain company Mediachain Labs, signed a licensing deal with Universal and another with indie labels via Merlin.
Wright is making no predictions. To the question of whether SongCast may be bought at some stage, he says he isn’t entertaining any offers: “maintaining integrity for independent artists is our priority, not just a sell-out to make a few bucks.” It would however consider partnering with any consumer brand that has a passion for independent music or possibly a mobile phone provider.
Competition within the wider distribution industry is potentially good news for both consumers and creators, because each distributor has different strengths. This distribution is certainly more lucrative for artists per click than the small returns from some of the sharing websites.
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