What Tubalr.com means for the music industry’s quest to monetize

A couple days ago a Reddit poster named Cody Stewart started a simple thread about a music app he’s been developing for the past two years. The web site is called Tubalr.com, and within the last two days, Stewart’s thread has received more than 2,800 comments — most of them glowing.

So what is Tubalr.com? It functions similarly to music streaming services such as Pandora, Spotify or Grooveshark. The difference is that it pulls its content directly from Youtube, scrapes away the advertisements, and allows its users to create completely personalized playlists.

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There are a couple advantages to this, notably the unique content that finds its way to Youtube; unofficial live recordings, fan covers and artist interviews will never appear on a Pandora station.

Another advantage — and this is the big one — is that Tubalr.com currently doesn’t sell advertising as part of its revenue model. In fact, based off of Stewart’s replies to commenters in the Reddit thread, there doesn’t seem to be any revenue model. At least not yet.

Stewart mentions in the Reddit thread that his motivation behind creating the site was to eliminate much of Youtube’s bloated user interface, which really means that he wanted to get rid of the bothersome advertising.

The result is a hit with its users. The site managed to crash due to bandwidth issues after the Reddit post took off, and Google Trends shows that searches for the site have spiked this month.

Tubalr.com’s appeal is a byproduct of Youtube’s success. Ads on Youtube have become more unbearable during the last year (thanks in large part to the 2012 election), which means two things: Youtube has monetized, but at the expense of the user’s experience.

That’s acceptable in the environments of TV and radio, but Tubalr’s quick success once again illuminates one of the Web’s many variables that have created tepid enthusiasm for the future of the music industry.

There will always be a developer working on a side project somewhere who’s looking not to make money (initially), but to improve the user experience. And the best way to improve that experience is by eliminating ads while keeping the product free for its users/consumers. That’s not terribly difficult for a developer who approaches the work as a pet project aside from their day job, which is what seems to be the case with Stewart.

The music industry has put a lot of hope into paid services such as Spotify, which reported in late July of this year that it had reached four million paid subscribers. That’s a pretty big number, but a search for Spotify on Facebook (users of Spotify must sign in with their Facebook account) shows that there are currently more than 24 million monthly users of the service.

The numbers suggest that just 16.5 percent of Spotify’s users opt for the paid subscription, meaning that the overwhelming majority of users would prefer intrusive advertising to a subscription model. There’s no doubt, also, that these same users would prefer no advertising at all.

This is the niche that Tubalr.com stands to fill, with the argument against the site being that services such as Spotify and Pandora pay royalties to artists, which is something that doesn’t seem to be in Tubalr.com’s future.

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Damon Krukowski of the group Galaxie 500, however, recently wrote an article for Pitchfork in which he attempted to clarify misperceptions about just how much revenue these services create for the musicians’ whose music they host.

According to Krukowski, Galaxie 500 earned a total of $1.05 for the 5,960 times the group’s song “Tugboat” was played during the first quarter of 2012 (the song was played 13,760 times during the same quarter on Pandora, for which the band received an even more insignificant 21 cents).

So artists are barely being paid by the few services that pay them, users prefer services that are free to use and free of advertising, and there will likely always be another Cody Stewart ready to create a service once Tubalr.com is shut down (which many Redditors suggest it will be for legal reasons too complicated for me to understand).

It’s a grim outlook for the music business indeed, and one that suggests the industry start searching for yet another form of revenue.