Streaming Music is Ripping You Off →
I assumed streaming royalties were paid by the “Subscriber Share” method. Apparently not. The big challenges I can see to implementing it:
What do you do with someone’s money if they don’t listen to anything in a month? I assumed the service would just keep all of the money in this case. But one of the inconvenient realities of auto-billing subscription services is that a lot of people keep paying long after they stop using them, and Subscriber Share might give people on the outside a way to deduce how many people aren’t actively using a given service.
You need to know exactly how much each person paid each month. This isn’t as easy as it sounds. You need to account for credit-card processing fees, currency exchange-rate fluctuations, fraud, chargebacks, and middlemen like Apple’s App Store that don’t give precise enough reporting to guarantee that you actually received a certain amount of money from a given user for a given time period.
But I doubt these problems are as problematic as clickfraud and a bunch of musicians who hate you, starve, and pull their catalogs.