During a recent interview with Grammy U and All Def Digital, Def Jams' Russell Simmons shared that, “Artists are finding all kind of ways to use their brand to earn money...They’re not counting their royalties as their income, they’re counting all of the things that they influence, all the multibillion dollar business that their branding and building and affecting..."
Which nicely sums up the problem with traditional means of valuing content through royalties and advertising. As a society, consumers may be buying less content, but consuming more content than ever via streaming, etc.
Thus, corporations should pay artist for the influence and not the amount of expected eyeballs that they expect to receive. After all, exposure to ads doesn't necessarily translate to action.
For royalties, it's hard to make money if people aren't paying for the content. Artists are losing a lot of income then when consumers don't purchase their content but still consume it. Hence, it would make sense for artists to earn money through the amount of influence that they're content is generating.
However, this new metric of measurement would need to be all-encompassing, able to measure social media and actions taken by the consumers in order to gauge the impact of influence. Current technologies are not able to do it yet as this platform would have to be fully integrated. Klout, the company that measures your "influence" via social media, doesn't count in that it's not a completely integrated platform since it can't record the actions (buying, browsing, emailing, etc) that consumers take after being influenced. I imagine that Facebook, Google, and Twitter are trying to be the first to have such a comprehensive platform.
Once such a platform exists, it'll transform the current payment model for artists and change advertising. Until that day comes, we'll be in this transitional period of trying to monetize content and measuring influence at the same time.