Streaming Platforms: The World’s Biggest Jukebox
Music streaming networks like Spotify and Apple Music have transformed music consumption, turning them into the world’s biggest jukeboxes, offering listeners endless access to tracks at the touch of a button. In the past, radio was the promotional tool that drove music sales—people heard a song, and if they liked it, they bought the product, whether it was a CD, vinyl, or cassette. This direct link between radio play and physical sales allowed artists to make a living from their music. However, streaming has flipped that model on its head; the “radio” is now on-demand streaming, and the promotional tool has become the product itself, with the revenue artists earn from streams being a tiny fraction of what they once made from physical sales. Interestingly, while streaming dominates, there has been a significant resurgence in vinyl sales. According to the 2023 RIAA report, vinyl sales in the U.S. grew by over 17%, with 41 million units sold in 2022, surpassing CD sales for the first time since 1987. This vinyl revival highlights that true fans still want to support their favorite artists in more meaningful ways by purchasing physical music, which offers a tangible connection to the artist and allows them to earn more. Unfortunately, for most artists, the reality of streaming is bleak—90% of the money Spotify pays out goes to just 1% of the songs, leaving the majority of musicians struggling to generate meaningful income.
While streaming works well for listeners, offering unparalleled access to music, it has significantly reduced the financial sustainability for most artists, forcing them to rely more on live performances, merchandise, and direct fan support through alternative platforms like subscriptions.
How Streaming Platforms Have Changed Music Consumption
Music streaming networks have completely changed how music is consumed. Here’s the key difference: Radio play is linear; a DJ plays the music, and if you don’t like the song, you simply wait for the next one. Streaming, on the other hand, is on-demand. You choose the song you want, when you want it. And this is where the problem lies.
Music Streaming Networks Promote Music But Shouldn't Be The End Product
Radio used to be a promotional tool for selling records. Now, streaming has taken its place as the promotional tool, but the difference is that streaming is also the end product. It’s no longer about driving sales—it is the sale.
The Flawed Logic of Streaming for Artists
Music streaming networks aren’t measuring good music with fans anymore because the industry is using flawed logic to measure fandom. The data being used is based on radio listeners, not actual music fans—and there’s a huge difference between the two. Here’s a startling fact: 63% of recorded music revenue comes from just 17% of fans. The rest comes from casual listeners. But now, those true fans can listen whenever they want on their digital jukebox, and many don’t realize that streaming isn’t the best way to support their favorite artists.
Streaming Networks Are in Trouble
Streaming networks are in trouble. Sure, they work for some, but for the majority, they show no signs of being a viable way to distribute music profitably. It’s estimated that 90% of the songs on Spotify receive just 1% of the money the platform pays out. That’s a problem. The top 10% of songs are raking it in, while the rest struggle to make any significant impact.
The Need to Separate Listeners from Fans
What the music industry really needs is a clear separation between music listeners and music fans. Fans want to support their artists, but streaming networks have blurred the lines so much that the tool meant to promote music has now become the final product.
How FanCircles Supports Artists Directly
At FanCircles, we see this clearly with our artist-to-fan social apps, which allow real fans to support their favorite artists through monthly subscriptions. It works. It converts. It proves that fans are eager to directly support their artists.
Why Fans Will Pay
You may ask, “Why would people pay if they can listen on Spotify or rip it from YouTube?” The answer is simple: because they’re not just listeners, they’re fans. These are the 17% of people who generate 63% of the industry’s revenue.
Making a Difference for Artists
As the CEO of FanCircles, I’m proud to say we’re making a difference—artist by artist. This is how it should be done.
Kevin Brown
CEO, FanCircles
