Newly launched in the UK, Rdio is now courting the artist community and will offer them incentives if they bring in new fan subscribers for the music service, turning musicians into its marketing ambassadors.
This is not expected to affect the streaming fee agreements it has in places with its labels, publishers and distributors, but will work more like a “finder fee” (with some online suggestions, referring to it as a “bounty”, pegging it at a payment of $10 per subscriber).
This effectively turns musicians into sub-retailers (capturing a little bit of the spirit of Topspin and Bandcamp) and means, in theory, they earn twice from Rdio – from the acquisition payment and from their fans inevitably streaming their music.
Given the heavy complaints Spotify has faced from a number of artists and independent labels over streaming payments, this is a deft (cynics would say “opportunistic”) move by Rdio to place itself as a heavily artist-friendly platform.
It has not, however, been met with across-the-board cheering or hats being tossed in the air. Digital Music News referred to it as “insulting”, with the subtext to its criticism being that the acquisition fee (equal to one-twelfth of an annual subscription) is little more than a sweetener to deflect attention away from the “paltry royalties” artists get from streaming services in general.
What is most interesting about the development is how getting the good will of artists will be essential to push subscription out of the early adopters. An artist showing up at a launch party or causally mentioning how they like a service in an interview is one thing, but giving them a cash incentive that goes direct to them (rather than their labels, with their equity stake in Spotify still a sore point for many) for actively recruiting users could add a new tilt (albeit slight) on the artist/label power balance.