Rdio to pay artists direct

Digital music service Rdio has today announced a new program that will allow artists to earn money directly from streaming music.

Believed to be the first of its kind in Australia, the Rdio “Artist Program” will reward any artist already signed up to Rdio 10 US dollars for each new subscriber they attract to the service.

Previously, artists were only remunerated based on a royalty model, which is calculated on plays and typically distributed through labels. Some artists have complained that those royalties were minimal, but Rdio chief executive Drew Larner recently told The LA Times the rate wasn’t the issue, rather the size of the subscriber base (roughly 10 million global listeners as opposed to US satellite radio subscription service Sirius XM, which has about 25 million).

In addition to being compensated directly, it is hoped that by growing the subscription pool, artists would be better remunerated in the long-term. “It’s well documented that the streaming music industry has been at the forefront of the wider artist remuneration debate that has been ongoing for some years now,” Rdio’s global head of marketing Marisol Segal told FL this week. “This will give artists a way to supplement their existing revenue streams by doing what they do naturally – connecting with fans.”

Artists already signed up for the service include Snoop Lion (aka Snoop Dogg), The Scissor Sisters, A-Trak, Chromeo and Ladyhawke, as well as local acts Catcall, Horrorshow, Gypsy and the Cat, Bluejuice and Angus Stone.

Speaking to FL today, Sydney musician Catcall said that with the dwindling physical market, artists are seeking other ways to increase their revenue. As a regular Rdio user, she described her involvement as a natural fit. “As a smaller artist I don’t really see that much, if any revenue from CD sales or streaming services so I guess I see this as gaining income through one of these services directly – that’s if people sign up. And because I was already using Rdio, my participation feels quite natural.”

Participating artists will receive access to a web-based tool to manage their account. They’ll also be able to customise their Rdio artist page and view real-time stats on referrals.

“I’m going to be more active in creating playlists on it now,” she said. “I think anything that rewards an artist by doing something they’re comfortable with, like listening to music, is positive. The fact is streaming services are here to stay, there’s probably a lot of improvement needed to on the model to benefit artists, but this does feel like a start.”

Segal said that at the heart of the program is the belief that artists should be compensated. He likened the initiative to the crowd-funding model, which has allowed artists to take more control over their own careers. “The connection between artists and fans is very powerful,” she said. “We see that now with the artists that currently use Rdio to share music with their fans. Whether through a Kickstarter campaign or social media, it is clear that fans are always ready to support the artists they love, and are willing to follow their leads.”

Launched in August 2010, Rdio has its headquarters in San Francisco and was founded by Janus Friis, one of the creators of Skype. For more information on the Rdio Artist Program click here.