Before release
Old Model: Find the right label
New model: Find the right platform

If you’re an independent artist, music distribution platforms like TuneCore and CD Baby can get your music on iTunes and Spotify but at a cost—which can be tough if you’re a struggling artist not looking to add expenses. Instead, Gandhi says that many artists just choose to release their music through SoundCloud, which is free but only offers exposure through the one, very cluttered platform. Gandhi opted to release her music through Stem, a two-year-old LA-based startup where she was an artist-in-residence last year. In addition to getting her music to the masses, it tracks where her money is coming from—a revolutionary concept, she says, in an opaque world of music revenues where “no one really knows what a stream is worth…they just hope to get a check in the mail at some point.”

Release day
Old Model: Use videos to build buzz
New model: Use videos to make sales

When she was working as a digital analyst at Interscope Records before HBS, Gandhi identified a common pattern: Labels would first release a music video to YouTube to create buzz, and then drop the audio a few weeks later. But she realized that the approach was missing an opportunity to translate that excitement into actual audio sales—it was marketing product unavailable for purchase. And it didn’t have a shelf life: “YouTube videos can drive traffic to audio streams and sales, but viewing the video is often a one-time experience for most fans. So it is important to have the audio available online.” For her first single, “Her,” Gandhi released the video and the single at the same time; for the next track, “Moon in the Sky,” she released the audio first and the video a few weeks later. The test only proved her point—releasing the audio and video simultaneously was by far the stronger move. “Her” is Gandhi’s most-streamed song; “Moon in the Sky” is her least-streamed song.

Post-release tour
Old model: Release and tour
New model: Release, react, refine, and tour

“Back in the day, you’d release your album at Tower Records or HMV, and the fans would line up. And if you didn’t tour right then, you were irrelevant,” says Gandhi. In the streaming age, though, the discovery timeline is much longer—about six months, she says—which offers advantages: One, it allows more time for repeat listens and emotional connections to the music (“you’ve provided the soundtrack to their life, so there is even more excitement for the show”) and two, the data that artists can get from their streams help uncover fan bases in cities they might not have otherwise considered for tour stops. “It is no longer only the Top 40 artists dominating the live show landscape. All of us can find our tribes and build a successful following,” says Gandhi. “The industry is less of a zero-sum game thanks to streaming.” Plus, all that extra time can help polish a live show. “We had a minimum viable product and it worked,” she says. “But that extra time helped us build a show that will just be extraordinary.”

The US isn't the only region witnessing growth of music streaming services—China and Europe also show gains in the digital music market. As the music business evolves, how can you get ahead of these business model disrupters and be the change yourself? For more in-depth data on the music streaming sector from Statista, see eBaker, our online research portal for alumni.