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Why Streaming Music Isn’t Like Bottled Water…

Streaming music is just like bottled water, right?  Not all, actually.

bottlednoequal

1. People happily pay outrageous premiums for bottled water (a glass of tap water costs about $0.001).

Relatively few people actually pay for streaming music.

 

2.  People are convinced that there’s a difference between bottled water and tap water.

Not enough people feel there’s a difference between ad-based (free) streaming and premium (paid) streaming.

 

3. Sometimes, tap water tastes funny.

Free streaming always tastes good!  You just have to wait for it a little longer.

 

4. Bottled water is a proven, $100 billion industry that’s been around for decades.

Streaming music isn’t a profitable industry, hasn’t been around for more than a decade, and remains financially speculative.

 

5. There are many, highly successful companies selling bottled water at your supermarket.

There are only one or two companies successfully selling premium music subscriptions (and that’s a stretch).

 

6. The bottled water industry has convinced its consumers that tap water isn’t safe or clean enough, even though this isn’t necessarily true.

The streaming music industry has taught consumers that free streaming is not only sufficient, but a potentially superior option.

 

7. The bottled water is successfully competing with free.

The streaming music industry is losing against free, and constantly lowering its price or giving away music for free (to… compete with free).

 

8. The bottled water industry coexists with dozens of other beverage choices (Coke, juice, tea, Vitamin Water, beer, wine, etc.)

The streaming music industry is cannibalizing every other form of music consumption (with the exception of vinyl and live concerts).

 

9. Bottled water isn’t sexy, but it IS profitable.

Streaming music IS sexy, but ISN’T profitable.

 

10. There is product differentiation and price differentiation between various bottled water brands (Poland Spring, Dasani, Perrier, Fiji Water, Deer Park, Pelligrino).

There is little price (or even product) differentiation in premium streaming music (though services like Beats may start to change that).

 

11. The bottled water industry is often accused of screwing the environment.

Streaming music is often accused of screwing artists.

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Comments (29)
  1. Casey

    Water is needed to survive. Music isn’t.


    Reply
  2. Anonymous

    You don’t NEED Fiji Water to survive.


    Reply
    1. Willis

      Yes, but life is better with Fiji water over tap water.


      Reply
  3. GGG

    Did I miss something? Who said they were similar?


    Reply
    1. Robert Barlow

      Marc Geiger has been pushing this concept for years. He doesn’t understand that consumers aren’t buying water, they’re buying packaging.


      Reply
      1. GGG

        Well, that’s just silly. We have a hard enough time comparing streaming music to buying music, why even bother muddling it up with some dumb analogy?


        Reply
      2. Paul Resnikoff

        This has been a major theoretical comparison for about 10 years, but GGG, it may be that this comparison has simply been fading over the years. I say that because you are a regular reader of DMN, and probably read a lot of other related sources of music industry information (not to mention actively participate as a player).

        All of which perhaps tells me that, in reality, the comparison really never made sense. That inconvenient reality could be the reason why this idea isn’t referenced or getting more attention these days.


        Reply
        1. GGG

          Gotcha. Believe it or not, I didn’t mean that as a dig haha. I thought maybe someone from Spotify or something used it recently and I just missed it. Either way, pretty dumb.


          Reply
      3. my friend+buys+vinyls+and+hang+them+on+the+wall+still+packed

        exactly. packaging sells. think about how much of that bottled water is consumed outside of eating-at-home scenario (dominated by youtube, for music). Bars, restourants, and all the vending machines…mobility situations. where the same product is sold in smaller packages, at higher prices. It’s the comfort of the packaging that makes value. Nobody smart is really hoping to erode much share from youtube on desktop broadband traffic, the money is in providing well packaged mobile delivery.
        Anyway, water has the same physical weight it had 4 billion years ago, and we don’t yet have antigravity devices to move it at really low cost. gas is pricey. As for bits, we have a technology that move them at superlow cost, at least google has it, so the economic pressures are completely different.


        Reply
  4. Jaded Industry Dude

    I drink several bottles of Daft Punk a day


    Reply
    1. hippydog

      The Daft Punk water I heard has some great electrolytes ;-)


      Reply
      1. Paul Resnikoff

        It offers a surprising kick to the drinker!


        Reply
  5. John Denver

    Paul, this is the most absurdly obvious analogy ever. Thank you for the deep insight. Keep on rocking it. By the way, were you born with a silver stick in your ass?


    Reply
  6. Paul Resnikoff

    I can safely say your analogy is worse than mine.


    Reply
  7. Yawn

    The only valid analogy here is that there is consumer demand for both. I am SO Weary of this naval gazing debate (which to be honest, I thought was over and done by now).


    Reply
  8. Zac Shaw

    There’s a reason the bottled water comparison has been made by thousands of people over a decade: it’s trie. Paul, this is a silly clickbait post.

    1. Millions of people pay for streaming music, which has only been around for a few years, unlike bottled water, and that number is growing rapidly.

    2. People are convinced there is more value in streaming music than free downloads or YouTube, that’s why they subscribe, duh. People still pay for convenience and will for some time

    3. Doesn’t make sense, pointless snark.

    4. Bottled water is a $100M business because guess what, we need water to survive! I feel the sane way about music but come on, you can’t compare industries on scale here. Basic daily human necessity vs. music? Come on.

    5. Doesn’t make sense as an analogy. Actually kind of disproves your point.

    This is getting boring.


    Reply
    1. CBQ

      “Bottled water is a $100M business because guess what, we need water to survive”

      Last time I looked, the water required to survive did not need to be in a plastic bottle


      Reply
    2. hippydog

      Quote “Paul, this is a silly clickbait post.”

      I think thats kinda his job.. ;-)

      and it seems to work :-)


      Reply
    3. Paul Resnikoff

      Zac,

      I don’t think you are looking at the issues critically enough. First, bottled water is a $100 billion industry, with a b, not million. But think about what this industry is predicated on: I’ve never experienced a problem with tap water, at least in the US, Canada, or any industrialized nation of Europe or Asia. It is questionable whether buying a $2 bottle of water offers any substantive benefits over tap water in these cases (of course if I’m in Mexico City, I’m buying whatever bottle of water I think is safe for $5, no questions asked…)

      So, what is going on here? The idea that powers this $100 billion industry is this: bottled water is not only superior to tap water, but it is worth paying a 10,000X multiple to enjoy these benefits. But, there are studies that show that not only is tap water often comparable to bottled water, but that it is better! There are all sorts of impurities in the bottled water process, one of which is the leakage of chemicals from the plastic bottles themselves (which grows worse apparently when you reuse the bottle).

      On a bigger note, there are massive destructive effects on the environment caused by billions of bottles that are often not properly recycled (and, why should we be trying to recycle all of that plastic in the first place?)
      Some communities are even banning the sale of plastic bottles of water, just like plastic bags (in Santa Monica, that is already the law).

      But this industry has not only won this debate, they have won it to the tune of $100 billion! The streaming music industry is not winning in the same manner; instead, they are losing and unsuccessfully ‘competing with free’. The difference is shocking.


      Reply
      1. agraham

        Not to pile on…I certainly support the ideals in this piece, but I also am not sure I get this analogy…

        Tap water is ostensibly free…which the comparison to music would be free streaming. Therefore paid music would be comparable to paid water which would mean all the arguments that bottled music is a marketing ploy would mean paid music is a marketing ploy which is not the case.

        Most bottled water comes from municipal sources, not magical springs. It isn’t special. So there’s nothing to set them apart, so why purchase water that you already get for free. The same argument is not valid for music. It feels like this piece is trying to force an apples to oranges argument to fit where it simply cannot.

        In fact I don’t think you need this argument. Music is created…the industry that supports its creation employs people from all walks of life…including electricians, carpenters, and caterers. Not to mention the music industry is an enormous tax base. We don’t need an analogy to muddle a debate…we simply need to be clear as to how important revenue in this industry is to everyone who works around the music biz or simply enjoys music.


        Reply
  9. JTVDigital

    Another one:

    If bottled water has a bad taste, consumers will blame the bottled water supplier, not the bottled water retailer.
    With streaming, if pay-outs are low, artists will blame the streaming service, not their label.


    Reply
  10. W@ter

    a glass of tap water costs about $0.001… were do get this data from…… Go buy a /ltr. bottle of water in Northern Europe…speaking of music…outside festivals the water costs ~10EURO… Water must be FREE, Music only when the Artist agrees…


    Reply
  11. CBQ

    Bottom line is, people don’t really give f*ck about whether an artist is remunerated for their work – they just want to listen to music.

    All over the place people are trying streaming and thinking “hey this is a lot simpler than buying a CD, ripping it to a hard drive and transferring it onto my iPod and then storing the CD away somewhere and probably never playing it – and it’s cheaper too – hell, it’s even cheaper than downloading from iTunes”…

    What they’re not thinking is “ah, but what does the artist get every time I stream compared to if I’d bought the CD?”

    Sad but true.

    Navel gazing was mentioned earlier – agreed.

    Cher famously sang “if i could turn back time” – yeah well dream on, you can’t!


    Reply
  12. hippydog

    12. Bottled water is recycled..

    so is a lot of music out there ;-)


    Reply
  13. Andie

    Artists? What about the Writers and Music Publishers?


    Reply
  14. Versus

    Maybe.

    Let’s try another comparison:

    Is streaming music like cable television?

    – V


    Reply
  15. canno

    Companies like Google and Mega Upload have taught listeners that music should be free. They have built mega industries on giving away things that don’t belong to them, that they have invested nothing in creating, collecting ad revenue for each give away. Since so many free and ilegit sources of music are available, of course no one wants to pay anything for music. There can be no market price for music if one has no control over what they produce. As a musician, I have decided to give up recording all together as it costs way too much to make and there is no pay back. The myth has been that recorded music would drive people to your shows and would fund your recording and development costs. That has NEVER happened. Not enough to allow concert revenues to pay recording costs. Other musicians I’ve spoken to are going that route as well. One day recorded music may make sense again, but it is not the case now. Streaming in its current state is a loss.


    Reply
    1. Vince

      Well, you aren’t much of an artist, are you? I’m glad that you aren’t going to produce music, let real artists and creators make stuff and allow us to enjoy it.

      Culture ill needs people like you clogging it up.


      Reply
  16. Vince

    You *DO* realize that all the “points” you’ve made about streaming music were also compared to bottled water back in the day, right?


    Reply

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