Shouldn't Music Streaming Sites Pay Higher Royalties?

Recording artists both famous and obscure complain about the royalty of less than a penny that they receive for each play of their songs.

teenage girl in headphones listens to music with closed eyes
(Image credit: Getty Images/iStockphoto)

Q. My twentysomething daughter is a passionate humanitarian who buys fair trade coffee and champions higher pay for garment workers in poor countries. But for her music downloads—after the legal boom was lowered on the “free” (pirated) music streaming sites—she now patronizes services such as Pandora and Spotify, which pay artists a pittance in royalties. I see an ethical dilemma in this, but she doesn’t. How about you?

A. I’m with you. Your daughter personifies a key contradiction of the millennial generation: Its professed passion for helping "the little guy" sometimes clashes with its embrace of a free-everything, "sharing economy" ethos that tends to lower the pay of traditional workers and enrich the entrepreneurs who devise new ways to slash prices.

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Knight Kiplinger
Editor Emeritus, Kiplinger

Knight came to Kiplinger in 1983, after 13 years in daily newspaper journalism, the last six as Washington bureau chief of the Ottaway Newspapers division of Dow Jones. A frequent speaker before business audiences, he has appeared on NPR, CNN, Fox and CNBC, among other networks. Knight contributes to the weekly Kiplinger Letter.