They aren’t now, obviously, and I don’t know if anyone is even considering it, but after reading the most recent study about streaming services and mobile networks, I think there’s a (pardon the word) synergy that can’t be denied. There are already a number of established and fairly successful streaming services, each with it’s own demographic, and their impact is growing by the day. Once iTunes, Google, and eMusic join the streaming throng, the sheer weight of the movement will carry itself along.
Most streaming services already have some sort of licensing agreement with the major labels, so in terms of what’s available there isn’t much difference between them. The only real distinctions are ease of use, opportunities for the audience to discover new music (even though that’s not always what the audience wants), social network capabilities, and price (though there’s not much difference there, either). The only real opportunity for distinction in the future (besides, in the case of iTunes and Google, sheer size and brand recognition), will be exclusivity. Since profit margins for streaming are so small, though, it’s doubtful that the major labels would be willing to give an exclusive deal to a service, unless there were a guarantee that the services would find exorbitant. At the moment, it makes more financial sense for the major labels to spread their product through as many different services as possible.
Imagine, though, if an already successful, independent band, such as Radiohead (which would have little to lose in such an experiment), were to sign an exclusive deal with a streaming service, even if it’s for only one album. Physical product would still be available, of course, but perhaps not until after a delay of a month or two, much the way In Rainbows was released online or many albums are now released digitally before appearing in stores. Something like this has already been going on at Rhapsody, where they will occasionally have exclusive rights to stream an album the week prior to its release. Although there will always be other ways of getting a hold of music once it’s been made available in any form, it’s hard to imagine that such a scenario wouldn’t result in a boost in the subscriber base of whatever company was lucky enough to make the deal.
From there it might be only a matter of time before services started signing bands directly, both established groups who have untangled themselves from the majors or new bands willing to work for a pittance in order to get the exposure that a service with a few million subscribers might give them. It would mean lower profits for everybody at first, but it would also mean lower expenditures, and might ultimately turn into a steady revenue stream for everyone involved (it might even make theoretical nonsense like the long tail seem feasible).
Because the established labels would undoubtedly be resistant to such a plan (possibly even to the point of killing their agreements with certain services), and also because the services themselves aren’t set up, for now, with all the things necessary to be a record label, the majority of the acts on streaming services, at least at first, would be those independent bands who are unencumbered with contracts but also self-sufficient enough to put their own material together and do their own publicity. No doubt in the early days, the services would be willing to give these bands far more freedom than they could get from the majors, or even from some independent labels. In other words, while having almost complete artistic freedom, they would also be immediately connected to a distribution network that would give them instant access, plus essentially free promotion, to a potential audience of millions.
It’s possible—and excuse me if this sounds like either wishful thinking or sheer fantasy—that the result would be, for a brief time, a kind of golden age, where bands would find themselves given both a freedom and access to audiences they’ve never enjoyed before, and that even the audience would tune in in ways they haven’t for years. It will all fall apart in the end, of course. Once real money is being made, corporate conglomeration will set in, the audience will fragment (since it often seems that the more monolithic the source of access is, the more fragmented the audience becomes), and the whole thing will fall apart again, only to be reformed as something else altogether. I’m not making predictions, just suggesting one possible scenario. Stranger things have happened.