Taylor Swift's massive sales are bad news for music biz

Adam Graham
The Detroit News

Taylor Swift sold 1.287 million albums this week, and the music industry is in more trouble than ever.

Swift's new album "1989" sold more copies its first week than any album since Eminem's "The Eminem Show" during its debut frame in 2003. That's great news. Album sales have been trickling off for years, and Swift's album proves that with the right star, the right marketing and the right timing people will still buy albums in droves.

Here's the problem. Swift pulled all of her music from Spotify this week, dealing a blow to the streaming service that is one of the industry's few bright spots and the model many are looking to as the future of music consumption.

It's not unusual for big artists to withhold their albums from Spotify to juice their first-week sales; Eric Church and Coldplay both did it this year, and enjoyed two of the year's biggest debuts. Those albums eventually showed up on Spotify, but the Swift case is more severe. She's the first star of her caliber to outright yank her catalog from the service over money issues. Since she's music's biggest star, it's cause for concern that others could follow.

"I'm not wiling to contribute my life's work to an experiment that I don't feel fairly compensates the writers, producers, artists, and creators of this music," Swift told Yahoo! this week. "And I just don't agree with perpetuating the perception that music has no value and should be free."

Spotify is a Swedish-based streaming music service that launched in the U.S. in 2011. From a consumer standpoint, without exaggeration, it's the greatest thing that has ever happened to music. It puts the history of recorded music, give or take a few artists — the Beatles, Bob Seger and AC/DC are notable holdouts — at your fingertips at all times. No more need for CDs or downloads or iTunes' cumbersome software. For music fans, it's nirvana. (And yes, Nirvana is on there, too.)

Spotify has a free model and a pay model; of its 40 million users, about 10 million of them are paid subscribers, according to the company's latest figures. The free version has ads, the pay models don't. For $9.99 a month, users can enjoy all the music they want, anytime and anywhere, and they can proudly count themselves among those who still pay for music. (And at $120 a year, they're spending about triple what the numbers say the average consumer pays for music on an annual basis.)

Artists are not as keen on Spotify, however. Despite the company's insistence that it pays 70 percent of its revenues to rights holders, artists complain they receive a fraction of a penny for every stream. That's a problem, but as a subscriber, it's not my problem to solve. It's something that needs to be worked out between Spotify, the labels and the artists, with nothing less than the future of the music business hanging in the balance.

Despite anomalies like Swift's blockbuster sales, CDs aren't coming back. (Did you know automakers have stopped putting CD players in cars?) Downloads are also dead; too much hassle. That leaves streaming. It's the model the people have chosen, and we consumers play a pretty important role in this process. People are willing to pay for a good product, that's been proven. Everyone else needs to figure out the rest, and fast.