Prompt's TechBlog

Singer/songwriter Billy Bragg has kicked up a storm with a contribution to the New York Times calling on social networking sites to pay musicians for the content they provide. Writing after AOL acquired Bebo for $850 million, Bragg argues that the artists who posted music on the site for free are entitled to a payday now too, alongside the investors and techies who built the site. Mike Masnick, writing at Techdirt, argues that the musicians traded the use of their content for the exposure the sites gave them, and that you can't change the terms of a deal retrospectively.

Bragg does have a point. While social networking sites no longer pay musicians, at least one has in the past. MP3.com, the biggest site for independent artists around the year 2000, paid artists for each song visitors downloaded for free. Artists generating serious traffic to the site got a reasonable cheque at the end of the month. MP3.com is under new management now, and this idea hasn't been taken up by the new owners or by similar communities like MySpace.

But there are costs associated with running a social networking site too: traffic is not evenly distributed, with many artists consuming storage space without bringing a significant number of visitors. Those who do bring in the ears and eyeballs, help to underwrite those who don't.

The issue won't be resolved any time soon. You could argue that supply outstrips consumer demand for new music, pushing its market price to virtually zero. But if there is to be a new generation of professional musicians while music sales continue to fall, one business model might be to once more give musicians a share of the revenue their work generates at social networking sites.