Without proper transparency, we can expect more Coldplay-style withdrawals, says Psonar's Martin Rigby
Streaming music services have got off to a bad start with artists and other rights holders.
Several – Spiral Frog, Imeem – failed long before making any meaningful pay-outs, while others were taken over before they could prove their business models and pay anything out (Lala).
And those that have apparently been successful – Spotify, Deezer, YouTube – are criticised for the paucity of payments made.
There's been a long-running spat between songwriters and Spotify over pay-out rates, triggered by a 2009 blog post which extracted data from the Swedish performing rights society (STIM) to show that Lady Gaga had received $167 payment as co-composer of 'Poker Face' (this doesn't include any payment to her as performer, which would have been channelled through the label as master rights holder) from 1,000,000 plays of the song.
Whether this is a fair or reasonable level of payment to a composer or not, the issue is symptomatic of significant disquiet among songwriters.
In a BBC interview in 2010, Patrick Rackow, chairman of The British Academy of Songwriters, Composers and Authors (Basca), said: "At the moment, the amounts of money that are actually being received are tiny.
"That might be because there is no money there. But there is no clear trail that can be established so that the songwriter can trace back what they ought to have got. These things are behind a blanket of secrecy, and that is extremely worrying."
Recently, songwriters have been joined by some high profile artists. Coldplay, for example, refused to make their latest album 'Mylo Xyloto' available on Spotify. An article in the Independent said the band had given no reason for their refusal but that their label EMI was "embarrassed" by the refusal, since it is a two per cent shareholder in Spotify.
Whatever the merits and demerits of any particular digital music service whether it's based on downloads, streaming or an internet radio model, it's clearly sub-optimal to lose the confidence of artists and songwriters.
Nothing corrodes that confidence like secrecy and a lack of transparency – they imply the parties to a deal have something to hide.
Which explains the dismay that greeted the publication of pay-outs by the band Uniform Motion.
At Psonar, we have a single tariff structure that is transparent to all and the same for all parties. Our Pay Per Play streaming music service (out in beta this week) tariffs are determined only by a party's role in creating, publishing and distributing that music.
Artists can see clearly how much the label, distributor and service provider itself (i.e. Psonar) is getting from each play of a track, and since there is no industry ownership of Psonar there is no scope for a conflict of interests to arise.
* Martin Rigby is CEO of UK-based Psonar, a digital music service that charges a penny a play with no subscription requred.