Jack White, one of several celebrity co-owners of Jay Z’s recently relaunched Tidal streaming service, took to his website Wednesday to respond to fans’ criticism about the service and comment about music industry economics. He said several awesome things — “Digital in the car, Vinyl in the bedroom, baby” — but also seemed overly enamored with the good, old days of $18 CDs, which not even record executives defend these days. White also added a couple of misleading statements and half-truths among his Tidal proselytizing. We fact-checked the quasi-FAQ to separate the truth from the fiction:
White: “I’m aiming to get unknown artists paid so that they can make more music.”
Verdict: True, but negligibly so
Spotify pays approximately 60 percent of its revenue to rightsholders (plus 10 percent to publishers), including record labels, while sources say Tidal plans to boost that number to 62 percent (plus 10 percent to publishers). Jay Z recently said Tidal has 770,000 paid subscribers compared to Spotify’s 15 million. That 2 percent revenue difference is symbolically important, but won’t make much difference, at least for now, in artists’ royalty statements.
White: “I’m talking about the punk band that has 50k hits on Youtube and doesn’t see a dime.”
Verdict: Basically true
Music industry sources say YouTube videos pay between 60 cents and $2 for every 1,000 views, assuming the artists agree to advertisements. So White’s poor punk band receives between $30 and $100 in this scenario.
White: “People know that it costs a lot of money to make a super hero movie, but they don’t know that it costs millions to make a country album too.”
Verdict: Possibly true
White didn’t name names, but last year’s biggest country album, Luke Bryan’s Crash My Party, sold 800,000 copies (not counting singles or Nielsen Soundscan’s “track-equivalent albums”). If that album went for $10, Bryan’s label would have taken in $5.6 million (assuming the retailer, such as iTunes, took the standard 30 percent). If expenses were “millions,” net receipts drop to a minimum of $3.6 million. That’s not bad, although Bryan himself likely walked away with $900,000, and that’s only if you assume he has a Michael Jackson-level royalty rate. Why do you think the guy tours so much?
White: “I used to buy three records a month at $18 a piece when I was a teenager bussing tables. I also went to the movies three times a month. What did that cost? Same as today with inflation?”
White was 19 in 1994. And $78 for his monthly music and movie budget back then amounts to $123 in today’s dollars. But White can’t possibly be yearning for the good, old days of $18 CDs, can he? It wasn’t like those economics were good for artists, either. Yes, music has value — and today, that value is $1.29 for a song download, $10 to $12 for an album download, $10 per month for a premium subscription or free for an ad-supported digital subscription. Taylor Swift and several label execs have argued recently against the “free” portion of Spotify and YouTube. It’ll be interesting to see whether the illegal piracy numbers re-spike if that comes to pass. Unfair, but true.
White: “If Psy gets viewed 2 billion times and makes a couple grand, where did all his money go?”
Psy’s “Gangnam Style” video is at 2.3 billion views as of this writing. If it made between 60 cents and $2 per 1,000 views, his gross haul is between $1.4 million and $4.7 million — and counting. YouTube may not be the most fair way for all artists to make a living, but it’s certainly possible to become rich on it without dealing with a middleman record label.
White: “I want tons of obscure albums that haven’t been digitized to be on there too. Loretta Lynn recorded something like 90 albums! How many can you acquire or stream digitally? 4? 6? Where are the other 80+?”
Verdict: True, but Tidal is unlikely to solve the problem
At the moment, Tidal, Spotify and iTunes each make roughly 20 Loretta Lynn studio albums available (not counting greatest-hits or Christmas collections). It’d be incredible if Tidal plans to expend its resources mediating disputes between, say, artists and their publishers to complete individual artists’ streaming catalogs. But you shouldn’t count on it.
White: “Should movies be free too? How about food?”
Of course movies, food and music shouldn’t be free. But the record industry ferociously battled illegal piracy for nearly 15 years before Spotify, YouTube and others showed that free could mean “making a little money, rather than nothing, off advertising.” Only after these services took off did piracy numbers begin to drop. It’s possible Tidal, or perhaps Apple’s soon-to-relaunch Beats Music, will be so amazing that they convince all free customers to upgrade to $10 a month. That would certainly help artists and labels return to full health. But it seems unlikely.