Is AI Taking Over the Music Business?

Is AI Taking Over the Music Business

Hey everybody, it is the Trout once again and welcome to another episode of Vinyl to Viral here on The Trout Show. It's gonna be an interesting episode this time. I think you're gonna like it.

You know what I saw this morning before I sat down to do this show was a guy was saying that he was gonna go see Paul McCartney who's on tour again. And he said the ticket started at, ready? $308 for the cheapest ticket in the arena. And you're probably thinking to yourself, okay why are they 308 bucks? Yeah, it's Paul McCartney, but come on.

Well the reason why the ticket started $308, I'm gonna explain to you, but also I'm gonna talk about something that everybody's talking about and I think it's gonna have a huge impact on the music industry, is AI, artificial intelligence. And where is it going from here? Well, to know. You need to stick around because you know why? Because this is The Trout Show.

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Well, hello there again. Thanks for sticking around and listening to this episode. We're gonna talk about a couple of major things that I think are very important if you're a music lover or a person who loves to go to concerts.

So I'm gonna broach the first one, which was the comment made on social media about McCartney's going on tour and the seats start at 308 bucks. Now you might be going, okay, well it's Paul McCartney, he's 80 some years old, you know, is he worth the 308 dollars? Well that's a decision you'll have to make. But let me tell you the real reason concerts are so expensive.

There are people that control the music industry and they're called record labels. Even though there's not any records anymore, they still have people that control it. So you have the record labels and you have streaming.

Streaming is where you can listen to your favorite song anywhere, anytime, without actually paying for it. Well last year the labels made in 2024 25 billion dollars. That's billion with a B. But the average artist earns, are you ready? The average artist, and there's like a hundred thousand songs that are uploaded every single day on streaming.

It's unbelievable how many people are doing this. But the average artist makes between a hundred and two hundred dollars a year on Spotify. So you're asking yourself too, why would you become an artist? Well people love making music.

But as an artist myself, and I have things on Spotify, I'm a music producer. The average, it's just what people get paid. And I've had this discussion with many people.

So years ago when there was records being made, if you sold a million records, you got a platinum award for it. You probably get three or four hundred thousand dollars if you're a top-tier artist. Now if you sell or people listen to a million streams, you get maybe three thousand dollars.

That's a huge cut in pay. Because people like Spotify pay three-tenths to five-tenths of a penny per stream. That means a million streams would net three to five thousand dollars.

That's a long ways away from making three hundred thousand dollars. Now my point about this is artists, especially independent artists, have to tour to make money. And I've interviewed dozens and dozens of artists.

Some of them very well-known, some of independent. But they know two things that they have to do. They have to tour to make money, and they have to sell merchandise.

That's why when you go to a concert, the t-shirts are $50, $60, $70. They're making up for the difference in what they're not getting in royalties anymore. And a survey made by Banzougal back in 2023 said 60% of the indie artists rely on touring for over half their income.

As streaming and merch alone can't sustain them. They just can't do everything. And if you don't think about this, you probably don't when you're going to a concert.

Touring is expensive. You got travel, you got crew, you got venues, you got risks, you got insurance. One of the things that I think is going to change people's thoughts about this is artificial intelligence.

Because I can sit here at home, write a song on AI, and I have nothing to do with it. I might say make me a song that's like pop like Taylor Swift or like some other artist or a rap song. And all of a sudden a computer generates it out.

And I say make it something similar to what's going popular now. It spits it out. I put it up on whatever social media platform that people listen to.

And I can do everything on my computer sitting here. I don't have to go rent a studio. I don't have to have a producer.

And studio fees run from $500 to $1,000, excuse me, $2,000 per track. And you wonder why people want to go to AI. I have a theory that AI will become more prevalent when they figure out how to make it sound like somebody sitting there doing it themselves.

Now I'm not happy about it because I'll tell you right up front, every bit of music you hear on my station, unless I give credit to the individual, like the music you're hearing right now in the background, I did it all. I wrote it all. I produced it.

I did all the instruments on it. I don't use any AI. But I can see what's going to happen.

And the labels are concerned about it because the fact is, and this this just came up recently, if you listen to Rick Beato, who's got like five million people to follow him on YouTube, talking about a fake band that had something like a million streams on one of the social media things, Spotify. It was completely fake. The band was fake.

And they're worried like, oh my goodness, is this gonna put artists out of production? No, I don't think that's gonna happen. But I do think because of the inequities of how people get paid because of streaming. The financial stranglehold of low payouts and label dominance, I believe, will push artists toward AI.

There are tools out there now, one of them is called Soundraw and the other is called Vocaloid, that will let you create, mix, and master tracks for under $50 a month. I don't have to talk to people at the label. I don't have to talk to people about producing it.

I just sit down on my computer and go, here it is. But while AI helps artists survive, it worsens the streaming glut. As I said earlier, there's a hundred thousand tracks uploaded daily to Spotify.

That's 2024 data. So if you throw in AI generated music, often optimized for algorithms because they ask the computer, hey tell me who's gonna listen to this. It competes with human tracks which will further dilute royalties.

Which of course, nobody wants to get further dilute. We're gonna pay you one millionth of a penny. It's isn't crazy.

But here's something else that's interesting. In a 2024 study, and I'm sorry I can't tell you who it did it, I just have the information here, found that 60% of listeners couldn't distinguish AI generated tracks in blind tests. In other words, they put a real one on, they put an AI on, and people going, I don't know which one it is.

But I also think that artists that embrace AI and not use it as a crutch will probably stay ahead of the curve. But don't think record labels are sitting back and going, AI do we need to get into this? Because it's a complex issue. Because they want new artists and the new music, but they also got to make sure people like older music too.

It's a complex thing that they have to work through. But major labels are investing heavily in AI. And you know why? They want to streamline their operations.

They use it for data-driven AR. AR is basically artisan repertoire. Those are the people, which I don't even know if they exist still, go out and listen to bands to say, should we sign them? And they don't do that much anymore.

They watch TikTok and Instagram. And they're gonna use AI to predict what's going to be listening to on streaming. And they might automate mastering and marketing.

And some of the big ones have even have worked with big platforms to figure out AI platforms. That is what they call algorithmic soundscapes. That shows how they see AI as a revenue stream.

It cut costs. Why pay a full? I said this before I've thought about it. Why pay a full production team when AI can handle mixing or generate backing tracks? A 2023 Goldman Sachs reported estimated AI could save labels up to 20% on production costs.

But they're concerned about the downsides, of course. What if all of a sudden everybody's generating AI music? Which I kind of foresee that happening. And all of a sudden you've got all these artists out there.

Because what they'll do as an artist, why do you need a record label if you can sit at home and do this yourself? A lot of artists already have kind of gone past the labels because of how they pay. At one point in 2023, they took down UMG, which is one of the big ones, took down an AI generated song called Heart on My Sleeve. Because first off, it wasn't copyrighted.

But it's also it was AI generated. And labels are going to push for stronger laws, so they call it the No Fakes Act, to require consent for AI voice cloning. You've seen it already in politics.

People putting AI generated people up there, which are not real. And some of the smaller labels, well, they're kind of thinking about what they're going to do on it. Some of them embrace AI to compete with the majors, using it to produce higher quality demos on a cheaper budget.

Others people see it as a threat. AI makes it easier for unsigned artists to self-produce and distribute, reducing reliance on label support. Gee, didn't I just say that? The catch? Labels still hold sway over distribution networks and playlist placements, so they're not obsolete yet.

But in short, labels see AI as a tool to boost efficiency, profits, but a nightmare for intellectual property. Who owns it? The computer owns it. I own it.

And market saturation. I'm going to tell you how I feel about all of this. As an artist myself, I think the problem is, it's always been one of these things that the big corporations, I wouldn't say they're greedy, but they drive the bus for everything.

That's why you got the 1%ers, Taylor Swift's, the Drake's, people of that ilk, that are at the top of the game making a lot of money. And there's a hundred thousand songs uploaded daily to Spotify. That's a lot of songs to try to weave your way through for people to listen to.

Everybody that's a songwriter that puts something out on Spotify or any of the streaming platforms, we're all looking for the same thing. We want people to listen to our songs. Now me, I quit trying to count streams a long time ago, because it really doesn't mean anything to me.

What means something to me is the fact that people listen to my music. I'm never going to use AI. I don't like it when it comes to generating music.

I think it should never be used. But because of the price that people pay to become an artist, it's getting bigger and bigger and getting paid less and less. I think, my opinion is, AI will start taking over more and more.

And we're going to have a mess at the end of the day. Okay, I'm going to editorialize here right now. It's called greed, people.

If labels would be more equitable. I mean, think about this. I think this is one of the biggest scams in my lifetime that I've seen.

Streaming. And I've talked about this before. Great for the consumer.

Wonderful that you can say, I want to hear a Jimi Hendrix song from 1968. Or I want to hear a Bobby Darin song from 1959. And it shows up.

What I don't think it's good for is the artists that are trying to make a living and can't because of streaming. And that's why I think AI will continue to grow bigger and bigger and bigger. And it's going to be interesting to watch how everybody, and labels, corporations, and copyrights, and everything has to deal with this in the future.

Because you know what? It's not going away. AI is here to stay. Well, that's it for this episode of Vine on the Viral here on the Trout Show.

Hope you enjoyed it. You know, I'd like to hear your opinion. If you got an opinion about this, about record business, and about what's going to happen in AI, if you're an artist or not an artist, let me know what you think.

You can send your comments to me, to me personally, at Rick at the Trout Show dot com. Rick at the Trout Show dot com. We may talk about them.

I'd love to hear people come in and tell me what they think about this, what's going to happen. So everything else you need to know about the Trout Show, just go to my website, the Trout Show dot com. You can hear more podcasts.

You can watch my YouTube videos with all the artists that I've interviewed, dozens and dozens, and more coming up. As always, you can listen to my music, which is not AI generated. I had to say it.

And anything else you need to know, right there on our website. Oh, and I have a newsletter. I started doing that too.

Oh, and if you want to follow me on Instagram, it's called Texas Rocker. That's me. So until next time, people, remember two things.

One, David Smith, for attending and to support our show. And number two, remember, it's only rock and roll, but I love it. See ya.