What is digital distribution for artists?

We'll also discuss how you can leverage these distributor services to your advantage as an independent artist.

Ready? Let's dive in!  

When did the music business go digital?  

You might have heard the phrase: "The digital wave that decimated the music industry between the 1990s and 2000s." 

If not, this quote refers to the pivotal moment in music history: the advent and widespread adoption of MP3. MP3 is a compressed digital music file, that allows for easy storage and transfer. Music fans, therefore, no longer needed to go to the record shop to buy their favorite music tracks. Instead, fans could access these same tracks directly at home, with the ease and simplicity offered by the digital age. 

The impact of this change was enormous: sales revenues dropped by half between 1999 and 2009 for physical goods such as CDs. This introduction led the way for the arrival of digital platforms-- changing the game for the music industry.  

The Rise of Digital Platforms 

1998: CD Baby  

Born in 1998, CD Baby enabled artists to digitize and monetize their works on various streaming and downloading sites.  

1999: Napster 

Following closely behind, Napster was an online library of downloadable MP3 files, built on the peer-to-peer free exchange of audio files. At its peak, Napster had 80 million users on its platform. However, legal challenges from intellectual property lawyers representing prominent artists such as Dr. Dre and Metallica led to its shutdown in 2001 due to copyright infringement. 

2001: iTunes  

Everything changed in 2001 with the introduction of iTunes. Known as Apple Music today, iTunes was the first streaming and downloading store where copyrights were respected. This meant that it was a completely legal platform that paid artists their respective royalties. iTunes' first partners were major labels, and by 2008, the platform had quickly become the biggest music seller in the United States.   

The Rise of Intermediaries 

In the following years, more digital service platforms (DSPs) rivaling iTunes began to emerge, including Deezer in 2007 and Spotify in 2008. With this rise, intermediary services between DSPs and artists also grew. 

Some intermediaries, like Believe Digital, initially offered services for digitizing tapes and other rare music formats before expanding to handle digitized original recordings. Other platforms, such as TuneCore, DistroKid, and iMusician, entered the scene, linking artists and DSPs.   

The term for these entities became 'digital distributors,' and they began to play a pivotal role in the evolving landscape of the music industry.  

Let's explore how digital distributors operate.   

How does digital distribution work?

The Market Players 

The digital distribution market comprises of four different sets of players:  

1. The people present at the recording of the distributed work (artists)  

2. Those who finance the recording (a label, producer, or artist in his garage) 

3. The digital service providers (DSPs) who distribute music online (Spotify, Apple Music, Amazon Music, etc.)  

4. Intermediary distributors between artists and DSPs (DistroKid, CDBaby, Winamp for Creators)  

Why do digital distributors exist?

Digital distributors serve a critical role in the music industry by helping artists and labels digitize and distribute their music online. These services have become indispensable for artists looking to reach a broad audience on streaming platforms like Spotify, Deezer, and Apple Music. 

Additionally, digital distributors provide unique and valuable expertise that can prove helpful for independent artists. This includes: 

1. Quality Standards

Your digital distributor knows everything about the quality standards required by streaming platforms. From ensuring accurate metadata to broadcasting high-quality audio files digital distributors can do it all. They also provide essential International Standard Recording Codes (ISRC) and Universal Product Codes (UPC), which serve as unique identifiers for your recordings. 

2. Data Centralization

Digital distributors provide dashboards centralizing helpful information, such as the income generated by your tracks and your listening statistics per streaming platform. Often, they offer marketing tips to help artists make informed decisions based on their analytics.   

3. Streamlining Distribution

As the name suggests, digital distributors make it easy to distribute your music. They can deliver your content to multiple DSPs simultaneously and can manage numerous profiles on your behalf. They also can act as a 'piggy bank' for your royalties—collecting what you have earned and allocating it out to you.   

4. Adapting to Trends

Distributors also continually improve their offerings by listening to the market and following industry trends. Digital distributors keep up to date with the best platforms on the market to ensure vital audiences hear your music.    

How to choose your digital distributor?  

There is no absolute right answer to this question, as all distributors have different advantages and disadvantages. Finding the best music distribution service depends on your career situation, resources, and needs. While there's no one-size-fits-all answer, we've provided some advice to help guide your decision:  

Ask yourself: Who is this distributor dedicated to?

The first question to consider is whether the digital distributor matches your artist profile. Are you an independent artist producing your own music? Are you signed to a record label and under contract? Depending on your specific circumstances, some distributors are better matched to meet your needs. Save time by making this the first step of your research!

Next, evaluate your time and financial resources.

Digital distributors have different pricing structures, such as annual fees or costs per release. Determine whether you are prepared to pay the price demanded. If you are not, keep looking for alternative distributors that match your needs and budget.

Sometimes, digital distributors take a commission on your master rights (aka part of your income generated from your tracks). To avoid this, work with a digital distributor such as Winamp for Creators, where artists can retain 100% of their royalties. 

Finally, focus on the services that align with your needs!  

Beware of the tendency to jump headfirst into distributing your music. It can seem attractive to spread your tracks on every platform possible, but this might end up costing you. Focus on the services that align with your specific needs. Maybe you want to target one or two countries, or maybe you only want to release tracks on Spotify.   

Ensure your digital distributor choice matches what you are looking for. Be aware of the number of streams per DSP, the country/city of plays, and the revenue generated by these streams. This level of detail tells you which actions work best for your content.   

Be smart and choose the services that align with your needs and overall goals.