Music services proliferate the cloud. I just finished writing about whyd from France yesterday. The next music Web application that floats by my Chrome browser is Arena . Arena is an “artist-friendly streaming music service with a Listen To Own hybrid distribution model”. My curiosity is piqued so I become a member and sign in to another music experience.
Arena is designed to solve the thornier cloud music distribution model that accelerates and plagues the music industry. Musicians are grossly underpaid for the streaming digital music that others play for free. The gap between the number of cloud plays (listens) versus the micropayments the musicians receive is appalling. I thought I was helping by paying $9.99 a month to Spotify. After the pie is split I learn that I am not helping the artists very much at all, sigh.
Damon Evans, Founder and CEO of Arena Music has built a more equitable music distribution model. Listen To Own is the new future of music commerce. Here is why.
Listen To Own makes it easy to picture what the transition to an economically viable and artist-friendly streaming model looks like while maintaining the historic understanding of what a sellable music ‘unit’ is in today’s marketplace. We can say with a high level of confidence that it no longer matters how many albums an artist has sold. All that matters now is how many listeners that artist can convert into owners.
The music industry has concluded that the Average Return Per User (ARPU) is now highest through a monthly subscription account because consumers no longer see a value in paying to own music. Listen To Own diminishes the long term viability of any subscription based concept by doubling the standard value of an MP3 download after a track is streamed by an individual listener, either 5 or 99 times.
Consider the $9.99 Spotify Premium Subscription Account. If $3 is used for operations, Spotify has to split the remaining $6.99 of a single user’s monthly subscription between a mix of tracks served from a mix of individual artists. What is the point in promoting value in a gross ARPU of $9.99 when the individual artist payout becomes so marginal once divided?
Arena, on the other hand, generates an ARPU of $19 for a standard 10-track album and $1.90 for a track by combining premium stream pay rates with download revenue – roughly twice that of what the iTunes download store could produce for the same exact sale. The company leverages a multitude of unique revenue streams to fund the Artist Payment Pool it uses for premium stream payouts.
I want to thank PR Newsire for Journalists for putting me in touch with today’s content about Arena.