Physical media also yield a marketplace that's more "democratic" and more efficient. For example, if you're a hobbyist musician, then it's pretty favourable ec

Physical media also yield a marketplace that's more "democratic" and more efficient. For example, if you're a hobbyist musician, then it's pretty favourable economics to put your songs on a CD, go out busking on the street, and sell the CD. The CD is a perpetual license to play the music as many times as you want, whenever you want, including the right to lend it to other people, pass it on to your children as part of an inheritance or otherwise, etc. etc. So that's just about the widest possible legal right that the artist can possibly give to the listener, and, consequently, it should also command the highest possible price. You can charge, say, $10 for the CD, as opposed to, say, receiving $0.01 (don't know what the actual number would be), on each streaming-play of one of your songs. Dealing in the wider right is much more advantageous to the artist who is low on capital: They've had an up-front cost in creating the music and recording the CD, and selling CDs will amortize that investment a lot quicker than selling streaming-plays. Streaming plays may pay more dividends later, if the music gets listened to a lot for a long period of time, but the redistribution of that cashflow towards the earliest possible point in time is financially much more advantageous. So, if you have listeners paying for streaming plays, and artists requiring the largest possible payment at the earliest possible time, you require some moneybags intermediary to convert the one kind of cashflow into the other, and that opens the door to everyone getting ripped off in the process. Obviously, one could interject that this is talking about the buy vs. rent distinction rather than the physical vs. download/streaming distinction. You could imagine the artist selling MP3s from their website through a paywall and charging for it as if it was a CD. But that opens problems on the listener's side, in the sense that it creates overhead and friction to look after an MP3 collection well. But those two things are highly interdependent: Physical media is the technology that pretty much makes it the most frictionless on both sides of the transaction for customers to collect and use media over large time horizons. Once you walk down the path of download/streaming, you get into the territory where the thing you need to provide to the customer in order to exercise their legal right starts looking more like a service and less like a product, opening a whole can of worms and changing the economics fundamentally.