follow the money
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Over the last decade or two, there have been dozens of difficult licensing negotiations between rightsholders and online music platforms — some of which played out in public or even resulted in content being unavailable online.
Just this week, around the time YouTube temporarily took down music by SESAC songwriters, the digital rights licensing collective Merlin informed its member labels that TikTok “walked away” from talks to renew its license agreement and planned to deal with labels individually. This letter Merlin sent to its members says TikTok’s goal is “fragmenting the Merlin membership, in order, we believe, to minimize their pay out.”
In one way, this is an old story. Most online platforms have so much market share that it’s hard for rightsholders to negotiate good deals: There’s just one TikTok, just like there’s just one Facebook and just one YouTube. But there are thousands of labels. Since smaller labels need giant platforms more than those platforms need labels, they need to bulk up, in order to balance market share against market share. For indie labels, that means either making a distribution deal with a major or joining Merlin, which negotiates on behalf of its members. (This same idea has fueled a merger mania throughout the media business, as movie studios and book publishers merge to better deal with Netflix or Amazon.) Sometimes, though, platforms push back.
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In another way, this is an old story with a new twist. TikTok has suggested that part of the reason it wants to change its deal structure is that it’s concerned about fraud, specifically the alleged delivery of recordings and remixes by labels that do not own the rights to them or assert ownership incorrectly — a problem that sources say comes disproportionately from a few companies. This seems like a reasonable concern, and it’s one that’s widely shared, although the problem is hardly unique to Merlin. Plus, it should be possible to exclude a small number of bad actors from a new Merlin deal, and it’s hard to imagine that dealing with indies directly wouldn’t give TikTok a financial advantage.
In yet another way, this is a whole new kind of negotiation, the likes of which the music business hasn’t seen since the early days of YouTube. These days, most online platforms need to play nice, or at least sort of nice, since negotiations that turn ugly in public tend to be distracting from other public policy priorities, and because today’s negotiating counterparty could become tomorrow’s business partner.
TikTok seems less concerned with these issues: It went without a Universal Music deal for about three months early this year and then didn’t renew its NMPA-blessed deal with independent publishers. Partly, that could be because it’s already facing an existential policy issue in the form of a ban in the U.S., or at least a forced sale to prevent that. It also seems to think that music doesn’t drive as much value — which could be why it’s shutting down its nascent TikTok Music subscription service. Whether or not the company is right, its attitude toward rightsholders can be very different.
TikTok is also developing a reputation, fairly or not, for being less sentimental about the culture business than other platforms. For years, most online platforms have made the case that rightsholders are better off with the deals they’re offering, because of the exposure they offer — think YouTube or Spotify. TikTok clearly has significant promotional value, but it tends to act more aggressively. Or maybe its other reputational issues are so significant that pissing off music rightsholders just isn’t as big a deal.
That could change — TikTok’s Merlin strategy has indie labels rattled because it could splinter the rights group. If the platform’s gambit works, other companies could follow and Merlin could end up in a weaker position. The bigger indies would be fine. Others might look for leverage from the major labels’ indie distribution companies, like The Orchard (Sony Music) and Virgin (UMG), which would further undermine Merlin. This would damage the whole indie ecosystem — especially the small labels run by creative founders who don’t have the infrastructure to negotiate as smartly as Merlin.
There’s also a chance that this won’t be as easy as TikTok thinks. Going around Merlin could save it money, but if it’s so simple you wonder why no other platform has tried it. One reason is that Merlin deals cover a wide range of labels and content, some of which could be hard to get otherwise. Another is that it’s easier to do one negotiation than hundreds. Assuming, of course, that TikTok is serious about negotiating, as opposed to simply sending a letter with deal terms that it expects rigthsholders to accept.
A few days after the Sept. 16 arrest of Sean “Diddy” Combs on racketeering and sex trafficking charges, a book said to be based on diaries and notes from his late girlfriend, Kim Porter, became a best-seller on Amazon. (It was a best-seller within a certain category, which probably means it sold well but not hardcover-bookstore-best-seller well.) What’s really impressive is that the book did so well despite the fact that Diddy and Porter’s children say she didn’t actually write any of it.
The 60-page book, Kim’s Lost Words: A Journey for Justice, From the Other Side, was self-published under the name Jamal T. Millwood by Chris Todd, whose real name is apparently Todd Christopher Guzze. Todd has said the book is based on the contents of a flash drive, which he allegedly received from two people close to Porter and Combs, but he “didn’t ask too many questions about how they got it,” according to Rolling Stone. “If somebody put my feet to the fire and they said, ‘Life or death, is that book real?’ I have to say I don’t know,” said Todd, who says he’s a producer and journalist and hopes the book will lead other sources to come forward. (Journalists generally tend to ask too many questions.) “But it’s real enough to me.”
It would be hard to find a more ridiculous quote to describe the very serious problem that big media platforms have created. I have no idea how the book was written, of course, but Todd knows that’s not the point and presumably so do readers — it’s real enough to me, he says, so it’s real enough for them. (The story behind the book actually sounds more interesting than the book itself.) This sounds harmless enough until you realize that — wait a minute — that’s basically what Republican vice-presidential candidate JD Vance says about the claim that Haitian immigrants are eating pets in Springfield, Ohio. He heard it, then justified it as a way to call attention to a problem. (There is no evidence that anyone is actually eating pets, and the whole idea sounds racist.) Like Todd’s book, it certainly went viral. It was real enough for people — to the point that it has become an actual political issue.
Stories about scandals, real and exaggerated, are hardly new. (Diddy faces unrelated criminal charges; Porter died in 2018 of lobar pneumonia.) What is new, though, is the way online platforms create incentives to create and spread them. Amazon now sells more than a dozen books about Porter, including a “Kim Porter Coloring Book” and several books that use “lost words” in their titles. The speed and ease of selling books on Amazon’s open system has made Porter’s death a cottage industry. It’s gross — does anyone want to be memorialized by a coloring book? — and you can’t blame her kids for being upset. There’s money in it, though.
It’s a useful metaphor for streaming fraud. The problem isn’t that Amazon or online music services stand behind conspiratorial books or useless music with streaming numbers pumped up by bots — it’s that they don’t stand behind anything. Open platforms like these let people distribute their own art, which is promoted as a feature but might more often be a bug — a lot of what’s online is neither professional work nor hobbyist creations but rather get-rich-quick schemes of various kinds. Which is funny until it could affect an election.
The most common argument against this in the music business is that fraud takes money from artists, which is true, but it can be hard to get horrified about schemes to steam millions of fractions of pennies from thousands of artists. (Most of the book business works very differently, but dubious books do take money and attention that more legitimate books need.) Another argument is that low-quality material undermines the integrity of the system — consumers who hear lousy music and read dubious books might be less inclined to spend more money on such legitimate products.
The argument that ought to get more attention is that these kinds of products simply aren’t good for the overall experience platforms offer. Streaming services used to promote their vast selection, but at this point some of what’s uploaded just makes more popular music harder to find. The same applies on Amazon. A search for “Kim” and “Lost Words” brings up a half-dozen books — and even those who find and buy the one they want may be disappointed. Kim’s Lost Words has 98 reviews, which average out at three stars. Others have none at all. This doesn’t affect the value of other books, of course, but it could make them harder to find.
Any serious solution to this will involve changing the incentives. The current level of curation and enforcement won’t work once AI is more widespread. It’s one thing to sell a book that may or may not contain Porter’s words, but Amazon already sells 12. Are we ready for 12,000?
Making platforms easier to use will mean making tough choices, then pushing them down to distributors who will in turn push them down to individual uploaders. There are options, however: Platforms could hold uploaders responsible for content that hurts the user experience or pay out more to companies who have a better ratio of content users engage with compared to their total. That’s what I think — unless this all came from a flash drive someone gave me.
You can’t say no one’s getting rich from streaming. In an indictment unsealed in early September, federal prosecutors charged musician Michael Smith with fraud and conspiracy in a scheme in which he used AI-generated songs streamed by bots to rake in $10 million in royalties. He allegedly received royalties for hundreds of thousands of songs, at least hundreds of which listed as co-writer the CEO of the AI company Boomy, which had received investment from Warner Music Group. (The CEO, Alex Mitchell, has not been charged with any crime.)
This is the first criminal case for streaming fraud in the U.S., and its size may make it an outlier. But the frightening ease of creating so many AI songs and using bots to generate royalties with them shows how vulnerable the streaming ecosystem really is. This isn’t news to some executives, but it should come as a wake-up call to the industry as a whole. And it shows how the subscription streaming business model with pro-rata royalty distribution that now powers the recorded music industry is broken — not beyond repair, but certainly to the point where serious changes need to be made.
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One great thing about streaming music platforms, like the internet in general, is how open they are — anyone can upload music, just like anyone can make a TikTok video or write a blog. But that also means that these platforms are vulnerable to fraud, manipulation and undesirable content that erodes the value of the overall experience. (I don’t mean things I don’t like — I mean spam and attempts to manipulate people.) And while the pluses and minuses of this openness are impossible to calculate, there’s a sense in the industry and among creators that this has gradually become less of a feature and more of a bug.
At this point, more than 100,000 new tracks are uploaded to streaming services daily. And while some of this reflects an inspiring explosion of amateur creativity, some of it is, sometimes literally, noise (not the artistic kind). Millions of those tracks are never heard, so they provide no consumer value — they just clutter up streaming service interfaces — while others are streamed a few times a year. From the point of view of some rightsholders, part of the solution may lie in a system of “artist-centric” royalties that privileges more popular artists and tracks. Even if this can be done fairly, though, this only addresses the financial issue — it does nothing for the user experience.
For users, finding the song they want can be like looking for “Silver Threads and Golden Needles” in a fast-expanding haystack. A search for that song on Apple Music brings up five listings for the same Linda Ronstadt recording, several listings of what seems to be another Ronstadt recording, and multiple versions of a few other performances. In this case, they all seem to be professional recordings, but how many of the listings are for the same one? It’s far from obvious.
From the perspective of major labels and most indies, the problems with streaming are all about making sure consumers can filter “professional music” from tracks uploaded by amateur creators — bar bands and hobbyists. But that prioritizes sellers over consumers. The truth is that the streaming business is broken in a number of ways. The big streaming services are very effective at steering users to big new releases and mainstream pop and hip-hop, which is one reason why major labels like them so much. But they don’t do a great job of serving consumers who are not that interested in new mainstream music or old favorites. And rightsholders aren’t exactly pushing for change here. From their perspective, under the current pro-rata royalty system, it makes economic sense to focus on the mostly young users who spend hours a day streaming music. Those who listen less, who tend to be older, are literally worth less.
It shows. If you’re interested in cool new rock bands — and a substantial number of people still seem to be — the streaming experience just isn’t as good. Algorithmic recommendations aren’t great. Less popular genres aren’t served well, either. If you search for John Coltrane — hardly an obscure artist — Spotify offers icons for John Coltrane, John Coltrane & Johnny Hartman, the John Coltrane Quartet, the John Coltrane Quintet, the John Coltrane Trio and two for the John Coltrane Sextet, plus some others. It’s hard to know what this means from an accounting perspective — one entry for the Sextet has 928 monthly listeners and the other has none. If you want to listen to John Coltrane, though, it’s not a great experience.
What does this have to do with streaming fraud? Not much — but also everything. If the goal of streaming services is to offer as much music as possible, they’re kicking ass. But most consumers would prefer an experience that’s easier to navigate. This ought to mean less music, with a limit on what can be uploaded, which some services already have; the sheer amount of music Smith had online ought to have suggested a problem, and it seems to have done so after some time. It should mean rethinking the pro-rata royalty system to make everyone’s listening habits generate money for their favorite artists. And it needs to mean spending some money to make streaming services look more like a record store and less like a swap-meet table.
These ideas may not be popular — streaming services don’t want the burden or expense of curating what they offer, and most of the labels so eager to fight fraud also fear the loss of the pro-rata system that disproportionately benefits their biggest artists. (In this industry, one illegitimate play for one song is fraud but a system that pays unpopular artists less is a business model.) But the industry needs to think about what consumers want — easy ways to find the song they want, music discovery that works in different genres, and a royalty system that benefits the artists they listen to. Shouldn’t they get it?
By some measures, the recorded music business has never been better. U.S. sales grew 8% in 2023 to hit a record high $17.1 billion; streaming continues to grow around the world; and revenue and operating income are rising at the three major labels and many smaller companies as well. The subscription streaming model is appealingly predictable, and the explosion of other forms of online media, from video games to virtual exercise programs, is creating plenty of opportunities for growth.
By other measures, the industry is in a tough spot. The flood of new music pouring into streaming services — both legitimate and not — is diluting the royalty pool for professional musicians. (This, and some other things, might be good for some players, but it seems to be bad for the business.) Although comparisons are complicated, it seems harder than ever to break new acts. Underneath all of this is the part of the iceberg most people don’t see: The deals labels sign with acts are generally less advantageous, because artists have more leverage than ever.
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The numbers say it’s the best of times. Layoffs at Universal Music Group and Warner Music Group say otherwise. And although the recorded music business isn’t in any real danger — the only question is how fast it’s going to grow — it’s hard to escape the idea that something just feels off.
Welcome to the music business version of the “vibecession” that’s affecting the U.S. economy as a whole. The term, coined in June 2022 by the financial analyst Kyla Scanlon, describes the apparent disconnect between positive economic indicators and negative public perceptions. In layman’s terms, if the numbers look so good, why do things feel so bad?
Outside the music business, most of the economic news is good, or at least good-ish by the standards of the dismal science. Inflation is down and the economy seems to be growing again. The problem, in industry terms, is that people just aren’t feeling it. One example: Job loss concerns are high at a time when the level of layoffs is low, according to Marketplace. The article compares the current situation to a doctor talking to a healthy patient who thinks he’s sick. There are explanations for this: Perhaps our minds are still adjusting to higher prices, which continue to rise even as the rate of inflation declines, or maybe troubling political news just makes more of an impression than economic indicators.
This could be more than a feeling, as a Boston economist might say, since people and companies that believe the economy will decline might cut back their spending and, inadvertently, contribute to making it happen. Although the music business is much harder to measure, the same thing could happen there. The pessimism that has already led to layoffs and restructuring means there will be fewer A&R executives signing fewer acts and then spending less money on marketing and promotion. That might be necessary. But it’s unlikely to help.
What’s killing the vibe in music? Partly, expectations have changed. The hypergrowth phase of streaming is ending, but big music companies, especially UMG and WMG, are under some pressure to grow faster than the overall business. Subscription streaming is going from the savior of the music business to another new format that boosts some kinds of music at the expense of others. There aren’t many new stars — one of the big hip-hop stories this year was the feud between Drake and Kendrick Lamar. (This is both the winter of our discontent and the season of diss content.) And new albums by established stars like Ariana Grande and Dua Lipa are off to a slow start (although it’s hard to know what that means in a streaming-driven business).
There may also be a sense, both in the music business and in the economy as a whole, that the foundation is not as solid as it seems. There’s more talk of quick fixes, both in the overall economy (Blockchain!) and in the music business (NFTs!). But there’s not much effort to get at the heart of the problems: The economy seems increasingly rigged toward finance and the pro-rata royalty distribution of streaming services prizes viral sensations in a way that may make it hard for different kinds of artists to build careers.
In the meantime, the numbers keep going up. The stock market has skyrocketed, undeterred by COVID, inflation and conflict in the Middle East — but that can’t last forever. The recorded music business keeps growing, too, and it will almost certainly continue to do so — just perhaps not in the ways we have come to expect. Over the past few years, labels have spent fortunes signing viral superstars who win big — but how many of them will be around in a decade? Meanwhile, popular tastes are harder than ever to predict. Two years ago, when it seemed like the future belonged to hip-hop, could anyone have predicted such a big country comeback? Giving people what they want is a fine strategy — but only if they keep wanting it.
It’s a good time to toast the good times — but it’s tempting to ask for a strong drink, too. Both the music industry and the broader economy keep climbing over problems to reach new peaks. And they’re great places to be — until you realize that it’s all downhill from there.
Musicians and songwriters don’t tend to agree on much, but many of them want former president Donald Trump to stop playing their music at his political rallies and campaign events. Whether they can is a quadrennial quandary. The legal answer is yes, at least for songwriters: The big two U.S. performing rights organizations (PROs), ASCAP and BMI, require political campaigns to buy special licenses, from which rightsholders can pull specific works. (The other two, SESAC and GMR, do not issue campaign licenses but can make songs available.) But campaigns don’t always honor those requests.
The use of pop music in campaigns goes back at least a century: Franklin D. Roosevelt used “Happy Days Are Here Again” in his 1932 campaign, and Louisiana governor Jimmie Davis, also a singer, used “You Are My Sunshine,” to which he owned the copyright but did not write. Over the last decade, though, as politics has become more polarizing and pop culture has taken over life in the U.S., this has gone from a subject of occasional interest to one that gets considerable mainstream attention.
In most cases, the unauthorized use of music at a campaign event follows a sort of script: A candidate uses a song and musicians or writers have their lawyers send a cease and desist letter, partly because some campaigns will respect it but often because it’s just a good way to communicate their disapproval in public. How much do I dislike Trump? Enough to have my lawyer write a letter! Some musicians have these letters written, even though a public performance license for an event is only required for a composition, not a recording. Approval is only needed from musicians if the use of music implies an endorsement or involves video, which requires a separate synch license from a song’s publisher.
Now a few recent cases are making this issue more complicated. In mid-August, the estate of Isaac Hayes filed a lawsuit against Trump and his campaign for regularly using “Hold On, I’m Coming” as “outro” music at campaign events. (The estate is suing for copyright infringement, as well as under the Lanham Act, which would cover an implied endorsement, and there will be an emergency hearing in the case on Sept. 3.) Beyoncé has warned the Trump campaign about its use of her song “Freedom,” which has become a theme song for vice president Kamala Harris. And the Foo Fighters objected to the Trump campaign’s use of their song “My Hero” as Robert F. Kennedy Jr. took the stage to endorse Trump. (They have not sued.)
It seems like an accident of legal history that those three examples fall under the same law as playing a song during an hourlong wait for a candidate to take the stage. In the latter case, no involvement or endorsement is implied — the songs are just used as background music. These cases are different, though. The Hayes estate’s lawsuit claims Trump has used “Hold On, I’m Comin’” 134 times, often as “outro” music, which arguably makes it something of a theme. Beyoncé’s “Freedom” has become identified with the Harris campaign, which uses it with permission. And the Trump campaign used the Foo Fighters song to soundtrack a particular moment, knowing that it would spread widely on video, even though the campaign didn’t have a license for that.
These songs haven’t just been played in public — they have arguably been drafted into service for a cause the writers don’t agree with. “Hold On, I’m Comin’” has been played at Trump events both often and purposefully. Beyoncé should have the right to be identified with the candidate she wants to win. And the Foo Fighters song shows up in news coverage and online video, with the implication that Kennedy is some kind of hero for endorsing Trump.
Although we think of the use of music as a copyright issue involving a public performance, there’s more going on in all three of these cases. The current license system seems to work fine for the way campaigns use music at events in the background. But it would be nice if campaigns could agree with rightsholders, or even with one another, to get permission if a song is used in a way that will identify it with the candidate — and especially if it’s used for a moment that will be widely shared on video. This doesn’t necessarily follow legal logic, but it seems like common sense: If a campaign deliberately selects a song like “My Hero” to soundtrack a moment that is essentially designed to spread on video, doesn’t it make sense to get a video license? Who are we kidding?
Until the situation changes, creators will just keep objecting to the unauthorized use of their work — and they are starting to do so in more creative ways. The Foo Fighters have said they will donate the royalties from Trump’s use of “My Hero” to the Harris campaign. While the Hayes estate’s lawsuit goes forward, it might point out that although “Hold On, I’m Comin’” is played regularly at rallies — it was even rewritten as “Hold On! Edwin’s Coming” for the campaign of Louisiana governor Edwin Edwards — the song gets its name from what co-writer David Porter said to Hayes from the Stax Studios bathroom. If Trump isn’t using the restroom, perhaps another song might work better.
Politicians who use songs with permission also have some bragging rights. Tim Walz can say that Neil Young allowed him to use “Rockin’ in the Free Word” at the Democratic National Convention — an odd choice given the song’s sarcastic lyrics, but still great cred from a music icon. Harris can say the real “Freedom” is hers — and Beyoncé’s support with it. And we can all wait to see who Taylor Swift will endorse.
Presidential politics has been its own form of pop stardom for decades — certainly since Bill Clinton worked the saxophone on The Arsenio Hall Show, and probably since actor Ronald Reagan won the White House. At some point during that time, the party conventions became less like political meetings and more like pop concerts — staged presentations, usually in arenas that also host concerts, where icons perform their greatest hits. This year former president Barack Obama even came out during the Democratic National Convention to present a sly remix of his own tag line as a tribute to vice president Kamala Harris: “Yes she can.”
Like most remixes, this requires some knowledge of the original, so it’s not aimed at everyone — a 25-year-old voter would have been nine when Obama’s “Yes we can” campaign slogan first got big. The point is to rally superfans, excite influencers and inspire enough enthusiasm to pull in some undecided voters. It’s politics as cinematic universe — now with blinking LED wristbands and the “politics of joy.”
Increasingly, the modern way of expressing a worldview is to join a fan army, of a musician, a content creator, or even a politician. Now that pop culture has swallowed everything, fan relationships help people define what tribe they belong to, the way class or place of origin did before the Internet made those things so much less relevant. Supporting former president Donald Trump isn’t so much about favoring his policies, whatever they are, as about liking his frankness (or his insanity) or sharing his sense of grievance. (Isn’t everything rigged?)
The idea of a fan “army,” as opposed to a “club,” implies some kind of tension — or at least a tendency for devotees to define themselves against other tribes. Part of supporting Trump is condemning the media and “the deep state,” just like part of loving BTS is bemoaning that journalists just don’t get how great they are. Sides have always been chosen — think about the Beatles and the Rolling Stones — but now who fans don’t like is as important as who they do.
Not so long ago, politics involved… well, it involved more actual politics. Democrats wanted a bigger role for government, while Republicans like Grover Norquist wanted to drown it in the bathtub. Obama and Trump made it more about personality and worldview — “Yes we can” or “Make America great again.” (To Obama, the arc of history was bending toward justice; to Trump, everything was just going downhill.) Obama had plenty of policy ideas, but he campaigned on hope and change, which are hard to be against — who could run on despair and stasis? Besides, it’s harder than ever to pass ambitious legislation these days.
The conventions, which started as actual meetings and then became appointment viewing for people interested in politics, are now aimed more at fans of a certain party. And they deliver. Most people I know, most of whom are Democrats, think Harris did great, and I agree. But how could she not? She had an enthusiastic audience, good warm-up acts, even nice lighting. Most important, she has the momentum of momentum. The real question is how she’ll do with journalists and how she’d fare in a debate against Trump.
The closest thing to an open question was the potential for disruptive protests over the war in Israel and Gaza, which seemed like they could echo the ones that took place during the 1968 Democratic National Convention, also in Chicago. (With Hamas and Hezbollah firing rockets at Israel daily, it seems weird to refer to this as a war in Gaza.) Back then, anti-war protesters in Grant Park chanted “the whole world is watching” — a line from a Bob Dylan song — as police beat and arrested them. Recently, some did the same, but these days the whole world can now see everything on social media, though they can sometimes struggle to tell if it’s real or generated by AI.
After every big pop culture moment comes the fan army drama. In this case, that means Harris supporters have to convince far-leftists that they’re better off voting for her than staying home. Robert Kennedy plans to endorse Trump, because maybe he can get a look at the Roswell files. And Trump will complain that he’d be much more popular if only the charts were tabulated differently.
In November, we’ll figure out who’s No. 1. Until then, we have to wait and see if Taylor Swift will endorse a candidate — and whether either one will be half as effective as she is at using her dedicated fans to generate mainstream attention.
Once upon a time, most artists performed live to promote new albums. For most acts, the real money was in music sales, so they went “on the road” with schedules and strategies to maximize them.
These days the live business is a juggernaut of its own, with higher ticket prices, adjacent businesses like merch and VIP seats, and schedules, plus strategies of its own. So creators at all levels of popularity are starting to realize that it may no longer make sense to tour the whole country, or world, to promote a new release. In some cases, there isn’t one; in others a tour can boost an entire catalog. The old model of touring focused on building an audience, which meant artists would play cities where they weren’t so popular. Now touring is a revenue stream, so many artists double down to play more shows in cities where they’re already big.
The economics of touring means that acts run up costs every day they are on the road but only bring in revenue when they perform — so it makes sense to play bigger shows, in fewer places, with fewer days off. Metallica’s M72 tour consisted of two-night engagements and a no-repeat pledge to motivate fans to see both. The international legs of Taylor Swift’s Eras Tour involved more shows in fewer places — she covered Asia with four shows in Tokyo and six in Singapore and the Nordic region with three in Stockholm. The natural end of this thinking is a residency, or a few of them, and Adele took the summer off from her Vegas residency to play 10 shows in Munich at a custom-built venue with a capacity of 74,000. Why go to fans when fans can come to you?
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As it happens, this solves another problem with the touring business. As increasing competition for concert dollars inspires more elaborate productions, costs are skyrocketing — and many of them involve transportation and setup rather than a performance itself. For Metallica, much of the cost is in “load-in” — moving and building a doughnut-shaped stage with standing room in the middle, plus eight towers of speakers and monitors that weigh 11 tons each. The resulting expenses, which involve 87 trucks and several days of setup, make single shows difficult. Adele’s Munich show used what’s said to be the world’s biggest video screen, plus fireworks, confetti, smoke, fire and a string section. As expensive as that must be to build, imagine the cost of moving it and setting it up again a couple of times a week? How many venues even have room for a 220-meter-wide screen?
Doing more shows in fewer places also makes it practical to deliver events, rather than just concerts. Touring artists have to compete with festivals, which offer fans a lot of acts for their money, plus an experience to remember — and, not incidentally, share on social media. A memorable production, whether that means the world’s biggest screen or 11-ton speaker towers, can do the same. Personally, I don’t think Metallica or Adele needs any of this — I’d be just as happy to see either in a club, in front of a brick wall — but bigger productions seem to create a sense of FOMO.
Fans have certainly demonstrated their willingness to travel. When I saw Metallica last year in Hamburg, most concertgoers came from other German cities to see both shows. Swift’s European tour debut in Paris was filled with fans from the U.S. and Canada who realized that tickets there and a trip to France cost about the same as tickets back home. To some fans, Swift’s show is a vacation — Paris is just something to see on the way there.
In crude economic terms, concert travel essentially reallocates expenses from acts to fans — artists travel less, so concertgoers travel more. Most people don’t want to pay more than a certain amount for a concert ticket, but they seem more willing to spend on related travel. (I just spent about $300 to go to Stockholm to see Bruce Springsteen, an amount that seems too high to spend on a ticket, even though I essentially went to see the show.)
There are other costs and benefits, too. Younger fans can’t always travel alone. And as several European publications pointed out in their coverage of the Adele residency, this isn’t exactly good for the environment. (I think it makes more sense to tax travel rather than to object to a specific type of travel.) Residencies can also be more pleasant for artists — there are no songs about how nice it is to cross the U.S. in a tour bus. The flexibility is nice, too: Munich is a lot nicer in the summer than Las Vegas. Playing a few nights a week makes it easier to have a family life.
As much as I loved the Metallica and Adele shows, I think I still prefer the old model — although it’s easier for me to say that because I’m fortunate enough to live in a major city. I think there’s still long-term value in building a fan base the hard way. And I worry that fans who spend more money traveling to concerts will end up seeing fewer shows as a result. None of that changes the economics of touring, however, and organizing a profitable and artistically effective tour means understanding that.
The upcoming elections in the United States in November will be profoundly important, with consequences for the economy, foreign policy, technology and perhaps even democracy itself. From a music industry perspective, though, there just isn’t all that much at stake. After two decades of change, the industry has found a new business model in the U.S., in the form of paid subscription streaming, and there’s only so much a new president could do to either improve that or screw it up. Most of the industry’s policy priorities involve either legislation (which any president would almost certainly sign) or in-the-weeds rulemaking procedures.
You certainly don’t get this sense from artists and executives, most of whom support Vice President Kamala Harris, the presumptive Democratic nominee for president — and generally tend to vote Democrat. This probably comes from their personal politics — Harris doesn’t have an extensive track record on intellectual property policy or other issues important to the music business, although she was seen shopping for vinyl and appears to have excellent taste. (Make America analog again!) For all the disdain they get from media executives, Republican presidents have often been better for it, since they tend to reduce taxes, regulation and barriers to mergers. Same goes for legislators. Most music industry executives might not care for the politics of Sen. Marsha Blackburn (R-Tenn.), but she’s certainly helped their business.
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Which candidate would be better for any specific business isn’t entirely clear because, at a time when the world is growing more complicated, U.S. politicians seem to offer fewer specifics on complicated issues. Both Harris and former president Donald Trump seem to be running more on who they are than on what they plan to do. (Based on Trump’s comments at the National Association of Black Journalists event in Chicago on July 31, he seems to want to run on who Harris is, which says far more about who he is, and not in a good way.) Some of this seems inevitable — Trump likes to change his mind and Harris only entered the race after President Joe Biden dropped out of it on July 21. It might just reflect an increasingly tribalized electorate.
The music industry’s biggest issues have remained bipartisan, though, and they seem to occupy a rare demilitarized zone between parties in which politicians who don’t normally agree on much come together. The quintessential example is copyright, which often unites Republicans who favor property rights and Democrats who want to support the arts. The most complicated and important part of the 2018 Music Modernization Act was introduced in the House of Representatives by Rep. Hakeem Jeffries (D-NY) and Rep. Doug Collins (R-Ga.), who may not agree on much else. (In 2018, they shared their “Summertime Heat” playlist with Billboard.) This year, the NO FAKES Act brought together Blackburn and Sen. Amy Klobuchar (D-Minn.), among others.
The industry’s traditional opponent on strong copyright is Silicon Valley platforms, which had a lot of power under former president Barack Obama. (Months ago, I saw Obama talk about the dangers of online misinformation without mentioning that he did little to regulate the platforms it’s on.) Biden, who has been a strong supporter of copyright, has been more skeptical of Big Tech. Now venture capitalists and technology companies, who tend to vote Democrat but favor libertarian politics, are courting both parties. Reid Hoffman and a group of 100 venture capitalists have announced their support for Harris, while Trump’s choice for Vice President, J. D. Vance, sometimes seems to operate as a wholly owned subsidiary of arch-libertarian Peter Thiel. The next president will inevitably be asked to deregulate artificial intelligence at the expense of the rightsholders who own the works it will be trained on — the only question is who it will be. Investors will also push to legitimize cryptocurrency — or at least reduce the legal barriers to pretending that it’s an investment instead of a high-end pyramid scheme.
The other big issue these days is antitrust law, which the Biden-appointed Federal Trade Commission chair Lina Khan is trying to strengthen. The immediate issue is the Justice Department’s antitrust lawsuit against Live Nation Entertainment, but more aggressive antitrust enforcement would also make it harder for the major labels to buy catalogs and companies. Although constraining the majors could make it easier for smaller companies to compete, it could also reduce the number of potential buyers they might attract. And although Republicans have traditionally wanted to weaken antitrust law, some populists now see it as a tool to reduce the power of platforms like Google.
The next president’s ability to help or hurt the music business may come down to putting copyright provisions in trade treaties, which doesn’t really resonate with the public. AI initiatives could matter, too. More AI legislation will almost certainly follow the NO FAKES Act, but that debate mostly sets different businesses against one another. (The NMPA recently asked the House and Senate Judiciary Committees to adjust copyright law, but that’s not going to happen so soon.) It’s harder than ever to pass federal legislation, and the president can only do so much to help.
The music business will also try to get wins on smaller issues — whether it’s legal to train an AI on copyrighted content and how much involvement of AI makes a work ineligible for copyright. These are the kind of subjects that require position papers rather than strong rhetoric. But we may not see those until 2025.
As a music journalist, I tend to look at fan armies with only professional interest — what they mean for the industry and how I can make sure they won’t figure out where I live. Last week, however, I suddenly had to face the fact that I’m in one — and I have been for the last 35 years. And I realized that many creators might need to change the way they think about cultivating and keeping superfans.
I went to Stockholm last week to see Bruce Springsteen, one of my favorite artists, for what must be at least the 30th time. I stayed in a hotel close to the venue, which was full of people like me — by which I mean Springsteen fans of a certain age (ahem) who wanted to see the concert enough to travel from all over Northern Europe and, in some cases, the U.S. Many came with spouses or children, and some planned on seeing a few shows — or even a couple of weeks’ worth. One couple said that they were happy Springsteen now gives himself a couple of days off between shows, since it gave them more time for sightseeing during the vacations they organize around concerts.
These people don’t think of themselves as part of a fan army. They don’t have a nickname or collect different versions of the same CD. I don’t, either. In fact, I feel a bit sheepish saying that this concert was one of the highlights of my summer, or that I spent a few hundred dollars to go, but it is and I did, and it was totally worth it. After the show, about two dozen people gathered in the lobby after the show to talk highlights and trade war stories, and some of them gathered again the following night after cancelled flights left them stranded in Stockholm. I feel even more sheepish about how much I enjoyed that.
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Whatever. From a music business perspective, this is just what superfans do. One difference between his and most is that Springsteen built his audience the old-fashioned way — with unforgettable live shows that convinced fans to come back and bring friends (and, these days, kids). The people in my hotel are obviously the exception — I’m talking about a few dozen people in a venue that holds more than 50,000 — but at this point I think Springsteen concerts mostly draw serious fans. (Springsteen opened with “Seeds,” which he only ever released as a live performance on a 1986 box set, so I assume he thinks the same.) And although it’s hard to be sure, I think most of them were won over by his concerts.
These days, music executives focus less on live acts — how live are most pop performances anyway? — and more on hit singles. Fan armies are built online, usually around the shared experience of hoping a song will go to No. 1 or buying extra copies in order to boost it. But how long will that last? The music you love when you’re young tends to remain in your life, but going to concerts might have more appeal over time than trading gossip about chart position online. Cultivating an audience devoted enough to keep coming back year after year can be much harder — but it can also be more effective.
The problem is that this part of the business is hard to see in data. Industry executives often talk about how much superfans are worth in terms of the CDs or tchotchkes they buy, but it’s harder to measure the effect of fans who keep coming back over the course of years. I saw one Springsteen show this year and two last year, which doesn’t really move the needle. The 30-or-so shows I’ve seen would, of course, but those were over a period of 36 years — starting with, if you’re curious, the Tunnel of Love Tour in May 1988. (I was already enough of a fan to attend two of the five shows — and then I was really hooked.)
What keeps me coming back — and I think what keeps most fans coming back — is that Springsteen delivers shows that are both consistently great and fairly different. If he’s had an off night, I haven’t seen it. At the same time, he makes every tour different and varies the set list every night, with moments of genuine magic — in Stockholm he delivered a haunting “Racing in the Street” and pulled a kid up onstage to sing the chorus of “Waitin’ on a Sunny Day.” Others keep going back to hear rare favorites — seeing Springsteen play “Jole Blon” in September 2012 was a profound experience for me, even if most of my friends had absolutely no idea what I was talking about.
You could say a lot of these things about a lot of rock bands — there was a time when playing a different set every night was the rule instead of the exception. And it does seem to draw people in. Fans love a curveball of a cover, and some even appreciate the flubs — there’s so much more at stake without the artificial perfection that comes from a click track. Communities are built from appreciating, comparing and, yes, griping about difference performances. Just read the New Yorker story about Dead & Company to get the idea.
Like any true fan, I’m going to say Springsteen is different. More than any other current artist, he believes — and gets concertgoers to believe, at least for the time he’s onstage — that rock actually matters, that there’s more at stake onstage than entertainment, that this kind of music can actually sustain you. As I get older, with less time to drive down an empty highway for no reason at all, it gets harder to believe that. But I’d like to. Maybe in some way I need to — so much that I’ll be back next year and probably again the year after that.
For a little over a year, since the Fake Drake track bum rushed the music business, executives have been debating whether generative artificial intelligence is a threat or an opportunity. The answer is both — creators are already using AI tools and they already compete with AI music. But the future will be shaped by the lawsuits the major labels filed two weeks ago against Suno and Udio for copyright infringement for allegedly using the labels’ music to train their AI programs.
Like most debates about technology, this one will be resolved in real time — Internet start-ups tend to believe that it’s easier to ask forgiveness than to get permission. Although neither Suno nor Udio has said that it trained its program on major label music, the label lawsuits point out that both companies have said that using copyrighted works in this manner would be “fair use,” a defense for otherwise infringing conduct. They’re not admitting they did it — just defending themselves in case they did.
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Whether this qualifies as fair use is well over a million-dollar question, since statutory damages can reach $150,000 per work infringed. The stakes are even higher than that, though. If ingesting copyrighted works on a mass scale to train an AI is allowed under fair use, the music business could have a hard time limiting, controlling, or making money on this technology.
If it’s not, the labels will gain at least some control over these companies, and perhaps the entire nascent sector. There are other ways to limit AI, from legislation to likeness rights, but only copyright law has the kind of statutory damages that offer real leverage.
Although neither Suno nor Udio has issued a legal response, Suno CEO Mikey Shulman released a statement that said the labels had “reverted to their old lawyer-led playbook.” The obvious reference is Napster, since most people believe that in the late ‘90s the music business saw the future and decided to sue it.
That’s not exactly what happened. The major labels knew that the future was digital — they lobbied for the 1995 Digital Performance Right in Sound Recordings Act, which ensured that streaming services had to pay to play recordings in the U.S., even though traditional radio stations don’t. They just didn’t want peer-to-peer services to distribute their content for nothing — or to have to negotiate with them while they were doing so. In July 2000, three months after the major labels sued Napster, leading executives sat down with the company to try to figure out a deal, but they couldn’t agree; the labels negotiated as though Napster needed a license and Napster negotiated as though it didn’t. In the end, after a decade of lawsuits and lost business, creators and rightsholders established their right to be paid for online distribution and the music sector began recovering.
And here we are again: History isn’t repeating itself, but it seems to be rhyming. If the labels negotiated with Suno and Udio now, how much would those companies be willing to pay for rights they may or may not need? It’s easy to make fun of either side, but it’s hard to know how much to charge for rights, or pay for them, before you even know if you need them.
These lawsuits aren’t about whether creators and rightsholders should embrace or avoid AI — it’s coming, for good and ill. The question, in modern terminology, is whether the embrace will be consensual, and under what terms. Most creators and rightsholders want to do business with AI companies, as long as that actually means business — negotiating deals in something that resembles a free market.
What they’re afraid of is having technology companies build empires on their work without paying to use it — especially to create a product that creates music that will compete with them. That depends on the outcome of these lawsuits. Because if you don’t have the right to say no, you can’t really get to a fair yes.
A couple of weeks ago, at a culture conference organized by the German recorded music trade organization, I heard German Justice Minister Marco Buschmann put this as well as anyone I’ve ever heard. “The moment people have the opportunity to say ‘No’ and to enforce this ‘No,’ they gain a legal negotiating position,” he said in a speech. (Buschmann also makes electronic music, as it happens.) In the European Union, rightsholders can opt out of AI ingestion, which is far from ideal but better than nothing.
What happens in the U.S. — which often shapes the global media business — might hinge on the results of these lawsuits. There are two dozen copyright lawsuits about AI, but these look to be among the most important. Some of the others are mired in jurisdictional maneuvering, while others simply aren’t as strong: a lawsuit filed by The New York Times could involve a different fair use determination if the ingested articles are used as sources but not to generate new work. These cases are straightforward, but they won’t move fast: It’s easy to imagine the issue going to the Supreme Court.
Despite the high stakes — and what will almost certainly be a rap beef’s worth of sniping back and forth — determinations of fair use involve a considerable amount of nuance. Fair use makes it legal in some cases to excerpt or even use all of a copyrighted work without permission, usually for the purposes of commentary. (An iconic Supreme Court case involved 2 Live Crew’s parody of the Roy Orbison song “Oh, Pretty Woman.”) This is far from that, but Suno and Udio will presumably argue that their actions qualify as “transformative use” in the way the Google Books project did. Next week I’ll write about the arguments we can expect to hear, the decisions we could see, and what could happen while we wait for them.