The streaming revolution is well and truly underway. Since YouTube premiered in 2005, consumers have become used to finding free media on demand. The last two years has seen dedicated music services like Spotify, Deezer and Rdio spring up to monetize streams and combat piracy.
Streaming hit the big time towards the end of 2011 when Facebook began to tie in music streams with "frictionless sharing", where users automatically recommend music to friends just by listening to it. And with 2012 promising a digital revolution in TVs, with both Apple and Google making moves to improve living room connectivity, streaming subscriptions are set for the big time.
All in all, streaming is hot, and it's growing fast.
But should your band take part, considering the meagre payouts compared to traditional sales?
To stream or not to stream?
The pro-streaming argument claims that it helps new fans discover your work, and in turn, pay for it.
But what is to stop the listener simply saving your album to a playlist rather than buying a full copy?
Letting your fans skip the traditional purchase route is a problem because streaming an album will barely earn the artist a couple of cents. It's a far cry from the several dollars they would earn with a regular sale.
But what if your music is good enough that the fan regularly streams your music for the rest of their life? Over the years, that fan could potentially earn you more than if they paid for a physical copy in the first place. Whether your music will hold their attention for so long is for you to decide.
Striking a balance
Some major artists are starting to find the sweet spot between their album launch and offering their music for streaming so they can get the best of both worlds.
Take Coldplay as an example. "Mylo Xyloto" was not available on streaming sites upon its launch, which allowed for a flurry of regular sales which helped them top download charts around the world. Had their music been available on Spotify, their sales could have been dampened - making it harder to cover those stratospheric recording costs.
But that doesn't mean Coldplay decided to shun streaming all together. In fact, they recently confirmed that the album will eventually land on streaming sites, allowing for a lifetime of streaming revenue on top of the millions their album has already earned.
As far as today's digital landscape suggests, you should opt for a similar strategy.
Release your album as usual and ignore the streaming sites until sales die down and your promotion budget has expired. This is when you want to submit your album to the streaming sites, in a bid to claim extra revenue over the long term. Make links to those services prominent on your websites, and remind your existing fans to use the streaming versions too. The more plays you get, the more those royalties will build up.
Giving in to change
Whether you like it or not, streaming has secured its place in our future.
It might not be long before a subscription package which bundles movie, music and TV streaming in one package. Some entertainment providers are offering those very packages already.
As internet infrastructure improves to help manage demand for the jump in data loads, and with the impending internet-enabled TV revolution, more consumers will replace their cable subscriptions with streaming packages.
This means the age of selling records for a fixed price could be over in a matter of years. As a result, artists will start to lose that bump of revenue from a fresh album release - which means having to spend less on the recording and promotion process.
For rock artists, this will be a devastating blow. Recording a full band can cost thousands in studio time, and it will be increasingly difficult to recuperate those expenses via streaming revenue over the short term.
Does this mean you should ditch your guitar for a laptop and produce electronic music, just because it has lower production costs? Not necessarily.
Live music can't be downloaded, and merchandise has long been a primary source of income for alternative rock acts. Ultimately, little will change for artists who didn't make their income from record sales already.
What will change is your release method. Streaming will become a de facto standard, and your job will be to make music that draws in listeners for the duration of their lifetime. Nail that, and you'll stand a chance of reaping royalty rewards for years to come.
By Tom Davenport