EconPapers    
Economics at your fingertips  
 

Rethinking royalties - Alternative payment systems on music streaming platforms

Frederik Jensen ()
Additional contact information
Frederik Jensen: Université Sorbonne Paris Nord, CEPN - Centre d'Economie de l'Université Paris Nord - LABEX ICCA - UP13 - Université Paris 13 - Université Sorbonne Nouvelle - Paris 3 - CNRS - Centre National de la Recherche Scientifique - UPCité - Université Paris Cité - Université Sorbonne Paris Nord - CNRS - Centre National de la Recherche Scientifique - Université Sorbonne Paris Nord

CEPN Working Papers from HAL

Abstract: Music streaming changed the recorded music industry's business model from individual product sales to unlimited on-demand access subscriptions. The streaming platforms experienced strong growth during the 2010s and now drive most of the industry's revenue, up to 90% in the most mature markets. The payment system for rights holders has remained unchanged. Many industry stakeholders criticise the system's alleged unfairness, and artist organisations, independent labels and major labels all propose different ideas to 'fix' the music streaming payment system. The current 'Pro Rata' payment system pools all subscription fees, with each rights holder receiving a payment proportional to their share of the accumulated number of streams. The system does not look to align the individual users' payments with their actual musical preferences and consumption. Therefore, this paper defines the problem of the current music streaming payment system as its allocation of equal value on all streams. The paper proposes a framework to systematically evaluate alternative payment systems inspired by policy analysis and planning. It additionally contributes with a structured evaluation of six alternative payment systems that rethinks how streams are calculated and remunerated to restore the price discrimination between different listening behaviours. The paper finds that developing a mixture of the alternative systems can likely solve many of the current system's challenges.

Keywords: Recorded music industry digitisation business models; Recorded music industry; digitisation; business models (search for similar items in EconPapers)
Date: 2023-09-05
New Economics Papers: this item is included in nep-cul and nep-pay
Note: View the original document on HAL open archive server: https://hal.science/hal-04286879
References: View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://hal.science/hal-04286879/document (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:cepnwp:hal-04286879

Access Statistics for this paper

More papers in CEPN Working Papers from HAL
Bibliographic data for series maintained by CCSD ().

 
Page updated 2023-12-30
Handle: RePEc:hal:cepnwp:hal-04286879