Hello! Excited to be back this week after a flood of recent music industry news. Some quick notes: music journalists Liz and Jenn Pelly started a newsletter called cryptophasia, where they review songs every couple of weeks. I’ve learned so much from Liz and Jenn’s writing over the last decade, so do support their work! Also, if y’all know of any good historical readings on the Copyright Royalty Board or any strong recent academic papers centered on the record industry, digital music, or financialization I’d love to read them. Now, let’s look a bit at “local” music.
Last December, Data for Progress, a progressive American think tank, released results from a poll that asked Americans about their thoughts on taxing film franchises to fund the arts via educational programming and grants. The poll showed 57% support vs. 24% opposition to the proposal, and since first seeing the results it got stuck in my head. The poll posited that private entertainment companies shouldn’t just benefit c-suites but rather there should be some amount of payback towards society. A potentially bold suggestion, especially within the context of the record industry.
A year ago when the coronavirus hit, the music industry was deeply affected by the closure of live touring and an initial dip in streaming numbers. However, one year later, a few trends are fairly clear to emerge. Record labels and publishers are just okay due mostly to rising streaming revenues. The isolation of streaming subscriptions from broader economic forces buffered executives, middle-management, and many white-collar workers across the industry, leaving artists even more reliant on a shaky business model. A similar trend emerged within live music: Live Nation absorbed hundreds of millions of dollars in Saudi Arabian debt to weather through the downturn; hundreds of smaller music venues across the country organized for the Save Our Stages Act, and many others simply shut down. Again, left on the outside were musicians now further encouraged to digitize their work or pursue non-music labor. This narrowing of physical spaces and performances appears to have contributed to a similar thinning out of potential solutions to this crisis.
Tech-First Solutions to IRL Problems
The gaps between industry health and the plight of day-to-day musicians aren’t new, just intensified. That’s why a recent tweet by David Rudnick, a graphic designer, on NFTs, non-fundable tokens, stuck out to me when Pitchfork highlighted it:
I fully respect the view of those who want nothing to do with the space, but the idea of assets on the blockchain isn’t going away. There is a small window to try to establish some norms or values that might have real value moving forward. Doing nothing now lets the predators define it.
Rudnick wasn’t talking specifically about music but I’ve seen similar levels of self-assurance within many conversations around NFTs. Much of the attention around NFTs right now is splitting into various conversations: gawking at the absurd prices that Beeple artworks fetch; deep concerns over the environmental impact of this technology; or more utopian ways of reorganizing how to support artists (see: Sara Ludy tweets on profit sharing). This produces a flattened conversion where even concepts/projects (like social tokens) create speculative NFT mania. Certainly, one can, if willing to devote the time, discern the different quality of the projects but I think it speaks to a slightly deeper issue with this moment.
Evegny Morozov in his 2011 book, The Net Delusion, fought against the accepted wisdom that the internet undoubtedly was going to change the world for the better. He makes a number of different points in the book but a central one is a strong skepticism towards viewing the world with a tech-first lens. He wrote: “Nevertheless, whenever nontechnological problems are viewed through the lens of technology, it’s technological experts who get the last word. They design solutions that are often more complex than the problems they were trying to solve, while their effectiveness is often impossible to evaluate, as multiple solutions are being tried at once and their individual contributions are hard to verify.” This speaks to the fevered chatter around NFTs and their ramifications for the record industry. Accepting NFTs as the future creates a new ingroup to claim part of an industry that’s already highly financialized without accessing how many folks even want proof of purchases from their favorite artists.
Over the last couple of decades, an assumption emerged that music should be understood primarily within the digital context as if music can only be understood in its commercialized form. (See: the Billie Eilish bedroom pop narrative). Music can begin in one’s bedroom but it can also start in a classroom, the park, or a library (the Brooklyn Public Library even allows free instrument lending). The last year of basically no music touring has kind of led to these conversations around the “future of music” that appear to look at life during a pandemic as the “new normal” when we’re slowly emerging from what will in many ways have been temporary. Techno-first solutions to the plight of musicians in many ways feel very insular and further crush all engagement of music into digitally mediated interactions.
There is also the fact that NFTs, Bitcoin, and GameStop meme stocks all exist within this continuum of a coronavirus-induced bubble of cash-heavy white-collar workers within the tech and venture capital spaces pumping money into different schemes and declaring them the future without significant public buy-in. That’s why Rudnick’s tweet rattled in my head—who is setting up the terms of these new technologies and how can one even afford to buy into these new spaces? It’s people not only with time and tech literacy but also with money that they’re willing to put into speculative goods. That may speak to some communities but it doesn’t represent all of those who experience music every day, and I bristle at any claim to speak with such authority.
Prior to coronavirus, where I live in New York City, there would be a summer NYC Music Month where they’d offer various programming for artists and communities, and even provide free studio space for people. The city holds an Office of Nightlife to help provide an outlet for restaurants and entertainment venues to communicate directly with the city. Even if I hold many, many, critiques of both city efforts, these are ways of attempting to disconnect music from the private market. There was an Irish proposal last year that looked into giving a universal basic income for artists and Germany reportedly provided 5,000 Euros to freelance artists due to the coronavirus shutting down the arts. I’ve mentioned it before but I still really enjoy a paper by Alex Williams (‘The Job Guarantee and Cultural Equity: Gatekeeping and Popularization’) which envisioned a way of supporting the arts not just through cash payments but through actually funding the various parts of the arts communities so that these can become solid jobs that contribute to a stronger arts economy.
In Real Life, Liz Pelly argued for, in her words, “socialized streaming”:
We should think of socialized streaming as one piece of a greater, international patchwork of shifts, toward building infrastructure for digital cultural commons — accessible and participatory tools and resources that would support artists and strengthen communities, inclusive of cooperative alternatives. It moves us in the direction of decommodifying music, setting precedents for decommodifying culture.
The subheader of Pelly’s piece said “A case for universal music access.” An idea that feels increasingly distant in how folks are beginning to imagine a post-coronavirus entertainment world. This isn’t to rehash late 90s tech pablum about how “information wants to be free” or some other nonsense. Rather, it is that communities can produce and sustain allowing the artists to be abundant, rather than scarce. Artists and collectives figuring out the best way of tending to their own space and contextualizing how they want their art to exist isn’t my goal to tamper. But in a moment where many of these conversations are occurring amongst those with money to spend eyeing ways to ultimately make it grow, I’m more interested in what can be done to further the universal experience of music.
Last week, the Biden administration passed the American Rescue Plan, which included the Butch Lewis Emergency Pension Plan Relief Act of 2021 that aims to fund numerous pensions for the next 30 years. Affecting potentially millions of Americans, the American Federation of Musicians was excited to see this pass with the union’s own recent pension issues. In other exciting news, Gimlet and the Ringer unions reached contract agreements with Spotify, a nice step for digital media’s continued unionization wave.
On Monday, the United Musicians and Allied Workers held rallies across the globe at Spotify offices for their Justice at Spotify campaign. I know a number of folks in the group and am excited that they’ve continued their efforts, even though I think many of these demands should be placed at the state before private corporations. Musicians hitting the streets with a firm set of demands is great to see! Also, a quick shout to the Columbia Graduate workers who are currently on strike against the institution.
A Note of Financialization
Anghami, a formal Lebanon-based music streaming platform, announced a merger with the Vistas Media Acquisition Company. (This is what the kids on Wall Street are calling SPACs!) The move is being led by SHUAA Capital, an investment banking firm, and Vistas Media Capital Singapore, owner of...Vistas Media Acquisition Company. The companies’ goal is to value the popular Middle Eastern music platform at $300 million. Only two months ago, SHUAA Capital bought an undisclosed chunk of Anghami, whose previous investors included various United Arab Emirates and Saudi Arabian telcos and private equity firms.
That context is provided because Mohammed Ali Al Shorafa Al Hammadi, from Abu Dhabi’s Department of Economic Development, said of the deal: “It will also establish a template for other companies in Abu Dhabi to realize their full potential by tapping into global capital markets.” A music streaming platform pumped with telco and private equity cash, then being pushed via SPAC onto the American stock market, as a way to start directing international cash into Abu Dhabi-based firms. I hope some musicians jack into this economic growth.
In slightly less complicated news, David Crosby sold his catalog, records, and publishing to Irving Azoffs’ Iconic Artists Group, although no details on the amount were shared. Anthem Entertainment, formerly Olé Entertainment, according to Music Business Worldwide got “a new revolving credit facility of USD $400 million, plus a USD $150 million accordion. (An accordion allows a borrower to incrementally increase the amount of its availability under an existing credit facility.)” Vibes. Anyway, I mention this because some amount of this money came from the Ontario Teachers’ Pension Plan, a former backer of the firm and inspiration for Kilometre Music Group, another recently announced Canadian song rights acquisition firm.
6 Links 2 Read
Divining Square’s reasoning to buy Tidal, beyond making Jay-Z and his peers more money doesn’t feel too worthwhile. Tidal is a small, unprofitable company and its value is in Jay-Z’s name and the idea of “black business ownership”, which the latter just undermined the former’s value. Otherwise, I’ll let time unspool the rest of the story. However, I did chuckle at private equity and venture capital analysts twisting into knots trying to explain the deal as if they needed to make a business case for why more than likely a tech dude just tried to impress his celebrity friends. But, no one pays analysts to reproduce Daily Mail copy.
What Are SPACs, the Trend Blowing Up the Finance World? - Vice / King of SPACs v. Hindenburg - This Machine Kills
A couple of skeptical deep dives into the world of special-purpose acquisition companies, also known as SPACs, which are just now starting to pop in the music industry.
I mentioned NFTs earlier but I found this nicely contextualized what this could mean for musicians and how many of the big headlines aren’t indicative of the overall space.
Inside the ‘Black Market’ Where Artists Can Pay for Millions of Streams - Rolling Stone (Subscription)
Just another reason why the United States federal government should follow the United Kingdom’s path and conduct a deeper investigation into record industry practices. Also, the user-centric streaming model, to be adopted by my employer SoundCloud, can address issues of fraud in case folks are seeking a business, rather than, state solution. Options on the marketplace of ideas.
Last year, understandably, there was high concern over the record industry’s financial future with coronavirus pandemic. However, it appears now that streaming cushioned the worst economic hit on large rights holders and collection societies. While individual artists often suffered, those processing checks glided through the storm.
Mass Hipgnosis - The Baffler
An absolutely beautiful essay that outlines the highly financialized future envisioned by this newsletter’s favorite firm the Hipgnosis Songs Fund. A world where popular music ended in 2012 and we’re given every three months a new batch of cover songs to enjoy over and over again. Bleak! However, the piece did tip me off to the fact Metallica started its own song rights investment firm last year, which I somehow missed.
The Penny Fractions newsletter arrives every Wednesday morning (EST). You can support via Patreon or follow on Twitter. If curious, here is the newsletter’s budget sheet, publishing schedule, and research database. The artwork is produced by graphic designer Kurt Woerpel, and the newsletter is copy-edited by Mariana Carvalho, with additional support from Taylor Curry. My current job is Program Manager at SoundCloud, so all thoughts here represent me, not my employer. Any comments or concerns can be sent to firstname.lastname@example.org.