I used to pay for a Rdio streaming subscription. I chose to pay the monthly fee, because theoretically I was helping pay the artists. Evidence suggests that not much of my monthly fee ended up in the hands of a musician. The small payoff for artists actually creates problems for the streaming services, because there is little to no incentive for artists to make their music available. New music by popular artists like Adele or Taylor Swift wouldn't be there. And even when I did "favourite" music and download it to my phone for off-line listening, music had a habit of randomly becoming "unavailable". I decided that for my music listening habits, I'd be better off going back to paying by the song on iTunes - and the musician would be better off for each purchase.
My question about streaming services is: why should artists accept getting paid some miniscule amount per stream? Why don't they demand that for each user that listens to a song, they get paid the equivalent value of a digital download from iTunes (50 cents or a dollar, or whatever the musicians get after Apple and the record companies take their cut). The musicians get the same cut whether a user listens to their song once, or listens to it 500 times. If the streaming service doesn't agree to that licensing model, then they simply don't get the licence.
This might mean the end of ad-funded "free" pricing tiers. But I'm sure the streaming services could still set a monthly fee that would allow them to make money. Let's say the artists gets $1 per user who listens to a song. Mr and Mrds Hardcore Music Nerd listen to 60 new songs a month. So you lose money on them. But I suspect they're outnumbered by Mr and Miss Top Forty Is My Life, who are just replaying whatever is on high rotation on the Edge or ZM over and and over over. They might listen to 10 new songs a month. So a $15 per month fee would still allow the streamer to make some money. I don't know what the song distribution is like, and whether you'd be able to set the fee low enough. How a consumer chooses to pay for music (and "all you can eat subscriptions" appear to be overtaking "pay by the item") doesn't necessarily have to be closely linked to how musicians get compensated. It sounds like the relationship is pretty loose already with rumours of record companies negotiating deals that give them fat fees, and the musicians very little.