We are living in the most practical period of music listeningNews at Home
tags: music history, Apple, music industry, Spotify, iTunes, phonograph, gramophone
Paige Morse is an intern with the History News Network.
Earlier this month, Rolling Stone reported that Spotify is made a $60.4 million profit in the third quarter this year. This is only the third quarter the company has ever made a profit in its 11 years in existence.
The music-streaming service attributes much of its success this quarter to premium subscriptions. Premium users pay $9.99 per month to essentially own every song on the service: premium allows users to play any song on-demand and download any song to play offline. Are we currently living in the most economical and practical period of music listening yet?
In 1877, inventor Thomas Edison invented the phonograph to record human sound on metal cylinders. Each cylinder recording would only last one play and the sound was very low-quality in comparison to today's digital recordings. Edison soon updated the phonograph so it would play music recorded on wax cylinders and his company began to market popular music.
Next came the gramophone, invented by Emile Berliner in 1887. This device was the first to use flat discs to play music. Since electricity wasn't widely available, users wound up the device to hear the music. The United States Gramophone Company formed in 1894 to market the product. This historic event has been designated as the “true beginning” of the record industry. The invention of discs made it possible to mass-produce music in a way that the structure of wax cylinders would not allow.
RCA Victor Records released the first full-length vinyl record in 1930, and this medium remained the most popular until around 1975 when compact cassette tapes emerged. Eight track cassettes also were common between the ‘60s and ‘80s in the United States. Compact cassettes were smaller than vinyl records, lending themselves to portability in car stereos. The Sony Walkman cassette player debuted in 1979, changing music listening forever as a portable activity to take with you everywhere. 200 million total Walkmans were sold, according to Time. By 1983, compact cassettes outsold vinyl records. Time’s Meaghan Haire wrote, “Walkman's unprecedented combination of portability (it ran on two AA batteries) and privacy (it featured a headphone jack but no external speaker) made it the ideal product for thousands of consumers looking for a compact portable stereo that they could take with them anywhere.” The Walkman revolutionized music listening, paving the way for products like the iPod.
Compact discs (CDs) began to be sold commercially in Japan in 1982 and came to the US in 1983. The first CD players, including the Sony CDP-101, cost as much as $1,000. CDs outsold vinyl records by 1988 and cassettes by 1991. In a recent Fortune article, Andrew Nusca wrote that the music industry raked in a record $25.2 billion in revenue globally, based on sales of tangible music like CDs, cassette tapes and vinyl records.
Then the industry took a hit. Napster, a file-sharing service, was started in 1999 and took the world by storm. Fortune’s Richard Nieva wrote in 2013 that “Napster was rebellious of convention, threatening to established norms, and, well, really loud.” The software allowed users to send files to other computers freely over a shared network. Nieva wrote that Napster proved to the world that the web had the “power to create and obliterate value.” The music industry lost value as people shared music for free with friends and family, eliminating purchase costs. Napster was ultimately brought down by an intellectual property case filed by the Recording Industry Association of America (RIAA) and shut down its service in 2001.
The iPod came to the forefront of music listening almost instantly in 2001, and in 2003 Apple launched the iTunes Store, a music-purchasing platform where songs are sold individually. According to the International Federation of the Phonographic Industry, at this time the music industry’s revenues had dropped by about $4 billion. Music fans could buy songs for 99 cents, bringing in almost $70 million in the store’s first year, according to PBS. The price raised to $1.29 for more popular songs.
Spotify entered the scene in 2006 internationally, then finally negotiated its way into the U.S. in 2011. While major labels were reluctant to hand over their music, many felt the decision would ultimately benefit them in the long run. It was inescapable that the industry was changing. Streaming had become commonplace thanks to personalized radio apps like Pandora and iHeartRadio. There would be no returning to the days of exclusively vinyl or cassette tapes. The industry had to adapt. Errol Kolosine, the former head of the record label Astralwerks and a professor at New York University’s Clive Davis Institute of Recorded Music, told Fortune, “The major labels kind of sat on their hands at the advent of streaming. The music industry went through a period of relative uncertainty, driven by not understanding the permanence of streaming. That reality has set in now.”
Music listeners must understand the industry’s past to appreciate the convenience and affordability of today’s streaming giants. Spotify (as well as Apple Music, Amazon Music, Tidal and more) gives subscribers access to virtually every song ever recorded at the tip of their fingers. And for what? $9.99 a month is not a high fee compared to a $1,000 CD player or a $200 walkman. Then factor in the cost of the actual music. The low personal cost for each listener is unprecedented in the industry, but improves the music experience for everyday Americans and has proven itself an effective business model.
Then why have some artists been so resistant to allowing their music to be streamed? Taylor Swift and Beyonce, two of the biggest pop stars in the world, refused to have their music on Spotify for quite some time before eventually giving in. Swift lasted almost three years without adding all of her music to Spotify. Kaitlyn Tiffany wrote about Swift's unique position as a performer and songwriter in The Verge: "She’s uniquely positioned to speak authoritatively on this issue as a public-facing brand and a behind-the-scenes creative." Swift values her creative abilities, refering to music as "important" and "rare" in her 2014 Wall Street Journal op-ed. Swift is right in the sense that music is valuable, but she was not able to see a future for music past buying CDs in a store, which makes her argument fall flat. Eventually she realized her mistake, because she allowed all her music to be used on Spotify in June 2017.
Spotify’s success this past quarter makes me optimistic about the company’s future, and record labels should be enthusiastic too. After all, artists and labels need Spotify just as much as Spotify needs their music.
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