Spotify's Own Math Suggests Musicians Are Still Getting Hosed 244
Nerval's Lobster writes "Spotify wants to change the perception that it's killing artists' ability to make a living off music. In a new posting on its Website, the streaming-music hub suggests that songs' rights-holders earn between $0.006 and $0.0084 per stream, on average, and that a niche indie album on the service could earn an artist roughly $3,300 per month (a global hit album, on the other hand, would rack up $425,000 per month). 'We have succeeded in growing revenues for artists and labels in every country where we operate, and have now paid out over $1 billion USD in royalties to-date ($500 million of which we paid in 2013 alone),' the company wrote. 'We have proudly achieved these payouts despite having relatively few users compared to radio, iTunes or Pandora, and as we continue to grow we expect that we will generate many billions more in royalties.' But does that really counter all those artists (including Grizzly Bear and Damon Krukowski of Galaxie 500) who are on the record as saying that Spotify streaming only earns them a handful of dollars for tens of thousands of streaming plays? Let's say an artist earns $0.0084 per stream; it would still take 400,000 'plays' per month in order to reach that indie-album threshold of approximately $3,300. (At $0.006 per stream, it would take 550,000 streams to reach that baseline.) If Spotify's 'specific payment figures' with regard to albums are correct, that means its subscribers are listening to a lot of music on repeat. And granted, those calculations are rough, but even if they're relatively ballpark, they end up supporting artists' grousing that streaming music doesn't pay them nearly enough. But squeezed between labels and publishers that demand lots of money for licensing rights, and in-house expenses such as salaries and infrastructure, companies such as Spotify may have little choice but to keep the current payment model for the time being."
30/70 split spotify/rights holders (Score:4, Informative)
Summary fails to mention that the payout is 70% of Spotify's monthly revenue divided by number of tracks played in that time period, distributed to the rights holders (BMG/EMI/Warner/maybe even you, puny indy guy) based on play count. If you're under a label, you then apply your contract rate and finally get your cut of the proceeds, which is probably not a lot.
Re:Are they really being hosed? (Score:5, Informative)
That's why artists tour. They make shit all on album sales. Especially if they didn't write all the songs they sing. They make lots more with ticket sales.
Re:Are they really being hosed? (Score:0, Informative)
Dude, you fucking nailed it. Of course you won't be rewarded by the mods, but you just took their pet argument and buried it six feet deep.
Some day the mods will get real jobs and will get over their emotional need to hoard thousands of copyrighted files, most of which they never get around to consuming, but which has already helped put *all* of the major record chains in the USA out of business (seems they were all run by incompetents, after miraculously managing to thrive in the '80s and '90s in spite of that). And persuaded many young musicians to go into other fields instead.
Re:Your call (Score:3, Informative)
I like the idea of being paid for the hours you put into a project; I get paid £16 an hour to write code, that code is used for more hours than it took me to write, but I only get paid once, I don't get paid for every "use" of the software. Why should it be any different for someone who writes music, movie or a book?
Our Spotify Experience (Score:4, Informative)
Spotify has been an interesting experiment for my band, The Wee Lollies (shameless plug - www.theweelollies.com). A single stream garners us a mere $0.0046. Three streams pays out $0.0199. I don't really understand that math, but it is what it is I guess.
All told for 2013, we've earned about 28 cents from Spotify. Granted, we're not a national band, we're not on a label, and we're probably mediocre by most folks' standards. So people aren't rushing to add us to their playlists.
So the takeaway for us is that Spotify isn't really an income tool for new bands. You already have to be quite successful for Spotify to give you enough plays to earn enough to pay for, say, lunch at Taco Bell. It's not even a decent exposure tool as our stream count is way low. We really expected more organic plays. We're kind of surprised that that didn't happen.
At this point we're still on Spotify because, well, why not? As an artist, you want to make it easy for folks to hear your material. But the reality is from a business perspective, it doesn't make sense. After you account for your own time and energy keeping track of everything, it's really a negative return.