Naver’s music-streaming service Vibe has recently announced a payment system that it believes is more transparent and profitable for artists.

Currently, streaming platforms such as South Korea’s Melon and Sweden’s Spotify use a “pro-rata” model that shares streaming revenue with artists by collecting all fees from users and dividing that pool of money according to the percentage of streams each artist receives.

That means even if you never listen to the most frequently streamed artists on the platform, a percentage of the money you pay will go to them.

Users who mainly enjoy indie musicians still send most of their money to mainstream artists, while fans of rookie bands end up mainly supporting big-name chart toppers.

Vibe says it aims to change this winner-take-all structure and pay artists based only on listening time by individual users.

“This system will further motivate artists because they are better compensated for their labor. Users also will feel closer to their favorite artists as they can more directly offer them financial benefits by streaming their music,” a Vibe representative said.

Vibe also believes the new system could help curtail the widespread practice of manipulating charts to reap higher profits -- for example, by employing bots to inflate a song’s numbers. There is no surefire way to stop it under the current system.

Adopting the new system may require massive amounts of money and data. But the real obstacle to its success is the lack of an industrywide consensus.

The current pro-rata system has long been built on agreements among stakeholders -- artists, their agencies, distributors, copyright organizations and platform operators. They are all closely connected through separate contracts.

“At this point, it is difficult to say which system is more profitable for artists,” a Melon official said. “Regardless of Vibe’s decision, we will continue to hear more diverse opinions until we make our own decision.”

The nation’s music-streaming market is dominated by big three players -- Kakao’s Melon (40 percent), KT’s Genie (25 percent) and SK Telecom’s Flo (20 percent). In the meantime, the younger Vibe remains a distant No. 4 with less than 4 percent of the market.

For Vibe, adopting the new system is not just about supporting a good cause, but also attracting more users and raising its market presence.

Vibe says it is contacting individual agencies to discuss the issue with the aim of launching the service in the first half of this year.

“Indie music labels are welcoming the system, while larger companies might need more time to think,” the official said, suggesting the system might start on a small scale and grow as it attracts more labels.

“In the long run, the system will benefit K-pop as a whole as the industry has grown due to its musical diversity. The new system may not be the perfect answer to the industry’s problems but it can serve as a clue.”

If all goes according to plan, Vibe will be the first streaming service in the world to adopt a more user-centric payment system. France’s Deezer plans to launch a similar service this year, though it is a pilot program.

By Kwon Yae-rim (kyr@heraldcorp.com)