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Spotify's Own Math Suggests Musicians Are Still Getting Hosed

Soulskill posted about 5 months ago | from the go-put-your-favorite-band-on-repeat dept.

Music 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."

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244 comments

Your call (5, Insightful)

oldhack (1037484) | about 5 months ago | (#45591487)

Pull your tunes out of their service if you don't like it.

Re:Your call (-1)

Anonymous Coward | about 5 months ago | (#45591493)

This! Capitalism bitch!

Re:Your call (4, Insightful)

Entropy98 (1340659) | about 5 months ago | (#45591525)

It actually doesn't sound that bad, 400,000 web pageviews pays nowhere near $3,000.

Re:Your call (3, Insightful)

DexterIsADog (2954149) | about 5 months ago | (#45591589)

You're comparing a webview of a frivolous news story or blog post to a recorded song as if they were of equivalent value.

Seriously?

Re:Your call (4, Insightful)

Z34107 (925136) | about 5 months ago | (#45591649)

You're comparing three minutes of frivolous background noise to the written word as if they were of equivalent value?

Seriously?

Re:Your call (3, Funny)

slick7 (1703596) | about 5 months ago | (#45592069)

You're comparing three minutes of frivolous background noise to the written word as if they were of equivalent value?

Seriously?

Between the Patriot Act and the NDAA and listening to the Barney song, Barney has it!

Re:Your call (2)

Opportunist (166417) | about 5 months ago | (#45592277)

What's the difference between obnoxious and obnoxious?

Re:Your call (2, Funny)

sumdumass (711423) | about 5 months ago | (#45592357)

One has a ? At the and and the other has a space.

Something tells me that wasn't whAt you were after.

Anyways, i'm wondering how the payments compare to radio with say a single station snd 400,000 listeners. I know BMI collects and pays differently for college radion verses commercial radio.

Re:Your call (2)

Riceballsan (816702) | about 5 months ago | (#45591793)

Is a song any more significant than a blog or any other page? Either one, drawing 400,000 takes either luck, or to produce something so good or so bad that it gets shared/tweeted into active circles etc... in both cases the off the charts money makers, are the creations that seem to have taken the least effort.

Re: Your call (1)

supersat (639745) | about 5 months ago | (#45591717)

I believe Spotify operates under compulsory/statutory licenses, so you can't really pull your music from the service.

Re: Your call (0)

Anonymous Coward | about 5 months ago | (#45591771)

There are plenty of artists who aren't in spotify by request.

Re:Your call (0)

gl4ss (559668) | about 5 months ago | (#45591803)

"niche indie album on the service could earn an artist roughly $3,300 per month (a global hit album, on the other hand,"

an album that makes about 40k a year isn't niche. at all. that's some artist that is popular enough to do gigs.

(but then again indie is just a word now that people use to market their music.. even if it was published by a label belonging ultimately to emi and had a fucking press kit sent by the label to music mags)

Re:Your call (0)

Anonymous Coward | about 5 months ago | (#45591919)

This has been mentioned time and time again, artists do not make money off of albums, unless they can find a distributor, record/sell the album themselves, and even then that money would still go into the cost of running your own label.

They make there money from show/concert venues, what cracks me up over talentless/non-commercial bands, they cannot get enough from venues so they go on and on over piracy, or streaming music losing them money.

But your right they can have it removed if they aren't getting what they think they should for the music, but if they are going to go on over that, then what about the money they lose from thousands of radio stations that get there albums for free, then play there songs for free thousands of times. Galaxie 500 seem to be complete idiots, they want paid every time some hits the repeat! That's what I'm sensing from there statement..

Re:Your call (5, Interesting)

fermion (181285) | about 5 months ago | (#45592153)

My understanding is that much of this is based on compulsory licensing. This means that if you record music, and sell music, then it fair game for broadcast. This has been the model for a long time. And it has worked. One wonders if the Beatles or Elvis would be successful if the radio did not pay to advertise their music. Yet much of the current issue we have from streaming is because many labels and artist think they left a lot of money on the table when the licensing for radio was established. Many labels and artist seem to believe that radio is stealing money from them, although one wonders how a hit can be generated more cheaply than through airplay. Airplay that depends on broadband owned by the public, BTW.

Here is why internet radio is not stealing money from artist. Because it pays more. My understanding is that it pays directly to artists, not through middlemen who manipulate the numbers to pay royalties to artists based on fictional 'credits'. So if an artist is to get $100 from spotify, that is $100 that they would have never gotten through radio, and part of the money is not being diverted to more 'popular' artists or just not paid at all because you do not meet the quarterly threshold.

I also think that the labels might be making a long term mistake by believing they need to maximize upfront profits in streaming instead of looking at the promotional possibilities. As an example I look at Eminem. He got really pissed off at Napster when his music was on the site back in 2000. However, his music was not playing on the major young peoples stations in 2000. He was playing on some stations I listened to, in particular a hybrid english/spanish/hip hop(ther is fair amount of really good spanish hip top) station, but was not at all what the 'in crowd' listened to. Suburban parents were not comfortable with rap. But kids were hearing the music, and I wonder where from. Could it be they were downloading it to the computers? From Napster. I recall when he broke through to mainstream stations. For instance I was in the gym and the DJ(they still existed back then) was pleading with listeners to stop calling requested 'Stan' as they were going to get it on the air as fast as they could. As I said, most stations were not playing it, it was listener demand.

This has all been rehashed millions of times. That the artists are being robbed by streaming. I don't know. In the US minimum wage is less than $8 and hour, so if you spend 40 hours on a song, and get $300 in royalties, I am not sure who you are behind. If I spend 40 hours coding, and someone uses it once, am I entitled to $300? The reality is that recording music, like coding or anything else, is a speculative enterprise. Unless you create some work for hire, where someone else is going to take the risk and gain the majority of the reward, there is no entitlement to pay.

Frankly, if all the big talent that wouldn't work for less than a million dollars a year, I am sure that we would be back to days where most work was done 'for hire' and the artists were paid the absolute minimum possible.

Re:Your call (4, Insightful)

mjwx (966435) | about 5 months ago | (#45592283)

Pull your tunes out of their service if you don't like it.

You do know that most "artists" dont have that control.

The reason writers and singers are getting screwed has nothing to do with Spotify, rather it's the system set up by the music industry to ensure that most cant profit or control their own works.

Spotify is the player, however it is the game that's rigged.

Get a real job (0, Insightful)

Anonymous Coward | about 5 months ago | (#45591495)

you music hippies

Money Paid != Artist Paid (5, Insightful)

elmer at web-axis (697307) | about 5 months ago | (#45591503)

Lots of middle men still exist between a artist and the end listener. All with very sticky fingers handling the money.

Re:Money Paid != Artist Paid (-1)

Anonymous Coward | about 5 months ago | (#45591511)

Lots of middle men still exist between a artist and the end listener. All with very sticky fingers from handling semen.

FTFY.

Re:Money Paid != Artist Paid (1)

Anonymous Coward | about 5 months ago | (#45591965)

They're holding it wrong...

Are they really being hosed? (5, Insightful)

Runaway1956 (1322357) | about 5 months ago | (#45591513)

What is there that dictates that an artist should be compensated every time a song is played? The rest of us are paid by the hour, by the job, under contract, or whatever. What is so special about artists, that they should be paid in perpetuity for having done a performance?

The REAL problem is, the artists get such a small piece of the pie, in comparison to the major labels. When a song becomes a global hit, the label makes billions, the artist gets a few million as a reward for enriching the label. And, all the REST of the artists are left believing that entertainment should pay big.

Dude - if you love music, play your music. If you love money more than you love music, maybe you should lay your guitar aside, and learn how to make a living. Musicians are cool and all, but FFS, we don't owe you a living for singing and playing.

Re:Are they really being hosed? (1)

Anonymous Coward | about 5 months ago | (#45591593)

What is there that dictates that an artist should be compensated every time a song is played?

Nothing at all, other than the fact that that's how you license their music. There's nothing stopping you from finding a musician you like and paying them as much money as they'll take to actually buy a song. Good luck with that.

Re:Are they really being hosed? (0)

Anonymous Coward | about 5 months ago | (#45591729)

Careful what you suggest. Copyright use to exist for the benefit of man. It is suppose to promote the arts, etc for our good. Not so artists or an entertainment industry can make a buck. If artists demands are unreasonable or that of the industry we should simply suspend copyright. Then there will be nothing. Truly nothing. And if you think music would go away your wrong. Music has existed for thousands of years. Copyright is only a recent phenomena.

Re:Are they really being hosed? (4, Interesting)

Sarten-X (1102295) | about 5 months ago | (#45591835)

Copyright is only a recent phenomena.

That's because mass copying is a recent phenomenon. Before easy copying techniques, art was promoted by patronage, as the GP suggests. It's still the effective system in small theaters and galleries around the world, and of course all manner of "arts" online. Get rid of copyright, and the patronage would still exist... it'd just be much more difficult for an artist to rely on an income, because there'd be no middlemen absorbing the financial risk.

Re:Are they really being hosed? (3, Insightful)

unitron (5733) | about 5 months ago | (#45591863)

... Copyright is only a recent phenomena.

For a three hundred year definition of recent.

http://en.wikipedia.org/wiki/Statute_of_Anne [wikipedia.org]

Re:Are they really being hosed? (0)

philip.paradis (2580427) | about 5 months ago | (#45591939)

Yes, over the scale of human history, three hundred years would indeed qualify as "recent." Reference Paleolithic flutes [wikipedia.org] dating back 40,000 years. What was your point again?

Re:Are they really being hosed? (1)

Anonymous Coward | about 5 months ago | (#45591981)

And since the context here is distributable recorded music - not just the existence of music or humanity in general - the idea that copyright is a relatively recent phenomenon is rubbish.

Re:Are they really being hosed? (1)

MeNeXT (200840) | about 5 months ago | (#45591847)

On that note maybe the artist can license the public air waves or just distribute the songs door to door.

Re:Are they really being hosed? (4, Informative)

viperidaenz (2515578) | about 5 months ago | (#45591595)

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? (1)

Anonymous Coward | about 5 months ago | (#45591647)

Lets just clarify something. What do artist get from a play of their music on Youtube when its distributed through someone elses pirated channel? Nothing. What does Youtube pay for 400,000 page views?

Content ID (4, Insightful)

tepples (727027) | about 5 months ago | (#45591689)

What does Youtube pay for 400,000 page views?

I was under the impression that revenue from YouTube's Content ID program was under nondisclosure agreement.

Re:Are they really being hosed? (0)

Anonymous Coward | about 5 months ago | (#45591947)

What do artist get from a play of their music on Youtube when its distributed through someone elses pirated channel? Nothing.

Do you mean a YouTube pirate channel?

Music on YouTube is fingerprinted so even if it appears in the background in a shaky-camera home video it will be flagged and a portion of the advertising revenue (and Google gets advertising revenue from every YouTube visit) goes back to the artist (or, more correctly, whoever registered the content).

Re:Are they really being hosed? (0, Flamebait)

Anonymous Coward | about 5 months ago | (#45591603)

How incredibly selfish of you.

I don't for a minute believe that you have stopped listening to music create by professional musicians either.

Re:Are they really being hosed? (2, Insightful)

DexterIsADog (2954149) | about 5 months ago | (#45591651)

Exactly. Just like people who create businesses. They're entitled to reasonable hourly pay, but once the company exists, if they're not still working, they shouldn't get anything more. The business would belong to... well, everyone, I guess, just as you believe songs and other creative content should be ownerless once created.

Right? Ownership is theft!

Re:Are they really being hosed? (0)

Anonymous Coward | about 5 months ago | (#45591839)

The information exists on my equipment, and I'll send or receive information with my equipment as I wish. You cannot compare tangible property with things such as copyright, and for reasons anyone with a brain has already thought of.

Re:Are they really being hosed? (1)

Anonymous Coward | about 5 months ago | (#45591909)

When you put it that way. What is the difference between someone that works to create something, say software, and someone that has done nothing but owns said software? It is who has the legal right to make money off of it in perpetuity that is the owner, not the worker. So yes, in your logic, ownership is nothing more than modern day fiefdom, a system that was abandoned hundreds of years ago as being a barbaric form of slavery through risk of starvation instead of violence (and sometimes that too). Somehow, by fighting for the 'rights' of creative types to be rent seekers, you have managed to convince me that the concept of ownership separated from effort is flawed.

Maybe you are carrying around some as yet undiscovered cognitive dissonance.

Re:Are they really being hosed? (0, Informative)

Anonymous Coward | about 5 months ago | (#45592033)

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:Are they really being hosed? (1)

Anonymous Coward | about 5 months ago | (#45592323)

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.

How in FSM's name can you make an argument that someone hoarding something that they don't even 'consume' is somehow putting record labels in the USA out of business. It makes no sense that someone not buying something that they would never have bought in the first place can be a direct or indirect cause of a failed company. Really. It makes no sense.

Re:Are they really being hosed? (2)

alen (225700) | about 5 months ago | (#45591751)

artists make about average profit margins for a business after expenses

the big pop artists spend a lot of money on advertising. you think its an accident how the photogs always catch lady gaga wearing weird clothes?

by the time you pay for recording, marketing, itunes/amazon and all the other expenses you get some for yourself and then you have to tour. just like every other business today. most products are loss leaders and you need a high margin product to make all the profits. in music its selling the recorded version of your music which is the loss leader. the profits are in the touring

Re:Are they really being hosed? (1)

kyma (3452919) | about 5 months ago | (#45591779)

This is absurd. Do you not value music? Maybe you don't listen to music. How is an artist supposed to go on about creating music and making a living with no financial support. "Tour" says viperidaenz. Well, what happens when they can't tour? I guess that throws starting/having a family out of the picture. Consider a 5-member band, that money from all those gigs starts dwindling down pretty quickly when you start to consider all the associated costs of living on the road. Furthermore, with a career in another field they will have to do exactly as you say Runaway1956. Set the music aside. Then what? We collectively have no music to listen to because nobody can afford to spend time creating it. This thread isn't about album sales, its about a streaming service that makes its money off a few advertisements. There's no money coming out of your pocket here. Economics101. There's no such thing as a free lunch.

Re:Are they really being hosed? (3, Funny)

hlavac (914630) | about 5 months ago | (#45591815)

Well, what happens when they can't tour?

They lobby with their friends at ministry of culture and get royalties on blank media from people that have never heard of them doing backups of their data! Yay! Never have to work again!

Re:Are they really being hosed? (1)

unitron (5733) | about 5 months ago | (#45591883)

Well, what happens when they can't tour?

They lobby with their friends at ministry of culture and get royalties on blank media from people that have never heard of them doing backups of their data!
Yay! Never have to work again!

I thought it was the record labels and/or publishing companies and/or ASCAP/BMI who got that money (on blank tapes to begin with, regardless of what was to be recorded on them).

At least under the version of the law they bribed into existence here in the U.S.

Re:Are they really being hosed? (5, Insightful)

ApplePy (2703131) | about 5 months ago | (#45592335)

This is absurd. Do you not value music? Maybe you don't listen to music. How is an artist supposed to go on about creating music and making a living with no financial support.

Try local music for a change. Really local. Like those guys you never heard of down at the corner pub on Friday night. They're not U2 or Garth Brooks, but hey, for a $5 cover charge and $3 beers, who's complaining?

Those guys aren't in it for the money. They have real day jobs (mostly) and play on weekends because they love music. They know they are never going to play to a stadium, and they don't care.

Do you get what you pay for? Maybe. Can you have a beer with the band after the gig? Yep! Try that with the stars.

Thing is, people who really love to play music don't care about money for it. Sure, it's nice to keep them in beer and guitar strings, and they get that. But I just don't go along with your premise that good music can only come from people who are *lucky* enough to make a living at it.

Re:Are they really being hosed? (0)

TheGoodNamesWereGone (1844118) | about 5 months ago | (#45592031)

Insightful but when the artist only makes at best 0.0084 oout of the 1.0000 pie, you have to wonder a little about who's getting screwed while everyone else laughs on the way to the bank.

Re:Are they really being hosed? (1)

G-forze (1169271) | about 5 months ago | (#45592381)

at best 0.0084 oout[sic] of the 1.0000 pie

Who pays a dollar to listen to a single song on Spotify? I thought it was $10/month.

Re:Are they really being hosed? (2)

russbutton (675993) | about 5 months ago | (#45592039)

Dude... To play as well as it takes for some no-talent schmuck to want to listen to something more than once takes a lifetime of very, very hard work. The problem is that people who aren't musicians have no appreciation for the work, heart and soul required for music to be good, let alone great.

Clearly you don't.

Re:Are they really being hosed? (2)

jelizondo (183861) | about 5 months ago | (#45592397)

You mean like every other profession?

You don't get to be a great engineer, architect, doctor or dentist just by going to school. It takes talent, will, hard work, good luck and years of effort.

Now, how many engineers or architecs (doctors or dentists) have a change to become millionaires like an artist or sportsman?

Artists always think they are special and nobody else can even begin to understand how special they are... Well, try engineering for a while. You won't even make it past Calculus I, great special one!.

So what you gonna do? (5, Interesting)

future assassin (639396) | about 5 months ago | (#45591515)

> (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?

So why don't you pull your songs from Spotify? Why not put them where you'll make bags of money? Wait you probably can't as you don't own the rights/distribution rights to your music?

Seriously you'd thin by now, and by that I mean ( its not 1997 and the technology has been there for years) the artists as a collective would have created their own distribution service and raked in the dough.

Re:So what you gonna do? (4, Insightful)

UnknownSoldier (67820) | about 5 months ago | (#45591607)

Concur 100%.

The artist don't want to admit that they need to pay for popularity which is no different from the existing system.

Real bands just work hard their entire life to expand their fanbase instead of whining about it.

Re:So what you gonna do? (1)

BringsApples (3418089) | about 5 months ago | (#45591759)

Seriously you'd think by now... the artists as a collective would have created their own distribution service and raked in the dough.

The band Tool does that for themselves, but to do it for other artists... dunno, that seems weird. I imagine that, like so many other groups of people, bands simply can't focus on 2 aspects of the industry. Making music as well as focusing on releasing that music on a scale that exceeds 1 band's tunes would eventually be to tiresome. I mean to say that at some point the sheer volume of music that had to be "delivered" to The People would require a full-time group of people that would have to get some cut of the cash. From there it's bound to evolve in the same manner that it's currently in, to some degree, where the artists feel that they're not getting a fair cut. After all, the more bands there were to contribute music, the more "cut" there is, and eventually, those spending time "delivering" music will be making more than the artists making the music.

Hosed compared to what? (4, Insightful)

EvilSS (557649) | about 5 months ago | (#45591529)

One of the articles today covering this compared the royalty rates to those paid by radio, which were about 10x what spotify pays. The problem is a) how many indie artists get ANY radio play and b) Radio royalties are per play, spotify royalties are per play per user. Sounds to me like radio stations are the ones giving them the shaft.

Re:Hosed compared to what? (5, Interesting)

radarskiy (2874255) | about 5 months ago | (#45591635)

a) Radio pays 0 performance royalties, only publishing royalties.

b) The publishing rights clearinghouses distribute royalties based on sampling, despite the fact that radio stations are required to submit their complete logs books. So if you're far enough down the long tail they may never recognize your play count.

Re: Hosed compared to what? (0)

Anonymous Coward | about 5 months ago | (#45591761)

By those maths, every radio station only had 10 listeners.

Re:Hosed compared to what? (0)

Anonymous Coward | about 5 months ago | (#45591765)

Someone else touched on this issue and it's important. Superstar bands, starting with say The Beatles (feel free to correct me on that) were only possible BECAUSE the distribution mechanisms were so sewn up that you could literally get the entire world listening to the same song.

They turned it completely evil then by creating an atmosphere where the coolest music to listen to is what everyone else is listening to.

Think about it: what incentive does a radio station have to pound the living fuck out of the same song every hour (probably at significantly higher royalties than something independent or from the back-catalogue)? It's because that means they can play that same song less than an hour later *and people will like that*.

Do not pay a cent for music. If you know an artist, buy them a beer.

Re:Hosed compared to what? (1)

unitron (5733) | about 5 months ago | (#45591895)

One of the articles today covering this compared the royalty rates to those paid by radio, which were about 10x what spotify pays. The problem is a) how many indie artists get ANY radio play and b) Radio royalties are per play, spotify royalties are per play per user. Sounds to me like radio stations are the ones giving them the shaft.

Yeah, well either that or radio is giving that song free advertising by playing it in the first place.

There's a reason record companies send radio stations free promotional copies of records, even if they're in some form other than vinyl these days.

Useless without context (4, Insightful)

Just Some Guy (3352) | about 5 months ago | (#45591537)

So, how much does an artist make per single over-the-air play on a station with 550,000 listeners? If as many people listened to Spotify as to broadcast radio, half a million plays per month seems absolutely trivial.

Without knowing how Spotify's pay compares to radio, this sounds like little more than an emotional rant from Clear Channel.

Re:Useless without context (2)

Firethorn (177587) | about 5 months ago | (#45591673)

So, how much does an artist make per single over-the-air play on a station with 550,000 listeners? If as many people listened to Spotify as to broadcast radio, half a million plays per month seems absolutely trivial.

That's the thing, I don't think the rates are based much on the estimated listener, plus as somebody else mentioned, most of the payment goes to the writer of the song, not the performer. Even then the sticky fingers of all the middlemen suck most of the money out.

On the other hand, I have to ask, should a 'nich indie performer' with a single album earn $3.3k/month from spotify alone? Maybe once he or she has ~5 albums out.

Re:Useless without context (2)

unitron (5733) | about 5 months ago | (#45591907)

... most of the payment goes to the writer of the song, not the performer...

Well, actually it goes to whoever owns the publishing rights, whether that's the composer or someone to whom they transferred those rights.

Re:Useless without context (2)

jones_supa (887896) | about 5 months ago | (#45591783)

Without knowing how Spotify's pay compares to radio

Well, lets throw some stats onto the table then. These are the Spotify artist compensation stats for the Finnish singer-songwriter Anssi Kela's hit song Levoton tyttö (original article [anssikela.com]):

March 2013: 186 317 plays, €458,70
April 2013: 415 353 plays, €878,60
May 2013: 300 524 plays, €618,30
June 2013: 156 119 plays, €381,30

Total:
1 058 313 plays
€2 336,90

In the same article, the artist comments: "2336,90 euros is better than nothing. At least there is something coming through Spotify. If making music was my hobby, that kind of income would be just fine. From the perspective of a professional though, I have to say that if more and more of album sales are replaced with these streaming compensations, it of course causes some wrinkles on my forehead. Currently the situation is that people have to listen one song for roughly two thousand times on Spotify for it to make me equal amount of profit that I get from one CD sold."

Re:Useless without context (1)

unitron (5733) | about 5 months ago | (#45591915)

... Currently the situation is that people have to listen one song for roughly two thousand times on Spotify for it to make me equal amount of profit that I get from one CD sold."

So, if the buyer of the cd doesn't listen to that same song at least 2,000 times, they overpaid, right?

Re: Useless without context (0)

Anonymous Coward | about 5 months ago | (#45591989)

Also, with MP3 singles, no one buys a CD for just one song.

Re:Useless without context (1)

AvitarX (172628) | about 5 months ago | (#45591925)

That's a silly sentiment.

If more and more album sales are replaced with the streaming, the royalties will go up.

2300/1000000 = .23 euro cents a play.

20% (high typical artist take of a 20 dollar, so I'll assume euro too, CD sale) * 20 euros (high CD price) =
4 euros per album sail.
4 euro / .0023 euros/track listen = 1800 track listens, or 150 album listens. I gather that it may take a little longer, but that spotify benefits the artist, not harms.

I wonder what the average use of a typical CD is, but I bet 150 hours is close, maybe a little high, but close.

Re:Useless without context (1)

Anonymous Coward | about 5 months ago | (#45592119)

150 listens for a CD is really high. I used to use a single iTunes database over a number of years (4-5 I think) and while I had one or two albums with hundreds of listens, vast majority never got over 50 and plenty got stuck around 20. Naturally this is a sample size of one, but I do listen to music that way on most days. Total number of songs was about 5000-6000, not sure how many albums. Personally I've found the streaming services to have cut my music bill to about 1/10th of what it used to be. I can understand why the artists might be slightly upset.

Re:Useless without context (0)

Anonymous Coward | about 5 months ago | (#45592061)

Yes but this is one song. So he should be taking in money with other songs. And lest be honest here if he can not live with the money from his songs than he shouldnt be a full time artist.

Besides Antti Kela is shit anyways.

Re:Useless without context (3, Insightful)

SydShamino (547793) | about 5 months ago | (#45592149)

$3800 for what amounts to a few weeks writing a song and coming up with accompanying music, recording it, and getting it post edited doesn't sound so bad, especially since they also made money from other streaming sites, CD sales, live performances of that song, T-shirts and posters sold because people like that song, etc.

What do they expect, to be able to retire off one "hit"? If they want to be a professional musician, they need to put in 40 hour weeks for 40 years and save for retirement, just like every other professional. If they're not able to be creative like that, maybe a creative profession isn't suited for them.

30/70 split spotify/rights holders (4, Informative)

Anonymous Coward | about 5 months ago | (#45591547)

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.

Ben Folds on the issue... (5, Insightful)

Anonymous Coward | about 5 months ago | (#45591553)

Ben Folds, one of my favorite artists, spoke on the issue and said essentially... "I think people are going to look back on this time 50 years from now and say, wow, people could become millionaires just by playing music".

It is really only the last 50 years or so that groups became enormously wealthy based on the music they perform, and now things are returning back to normal.

Re:Ben Folds on the issue... (0)

Anonymous Coward | about 5 months ago | (#45591953)

"I think people are going to look back on this time 50 years from now and say, wow, people could become millionaires just by playing music".

Well people still can become millionaires just be acting in films and on TV, or by being really good at hitting a baseball. Lots of people are willing to pay money to see that, so the first tier performers get compensated orders of magnitude more than what an average working stiff gets. This was true with musical recordings as well until Napster etc. came along.

They're promoting you; artists should pay Spotify (0)

Anonymous Coward | about 5 months ago | (#45591561)

Artists aren't paid by radio stations. It's considered promotion. Why should an Internet equivalent pay?

Copyright is a fraud. Your not entitled to anything as far as I'm concerned. You're getting more than you deserve. What was once a good, copyright, has soiled whats good for us as a society.

Keep your music. I don't want it.

Radio pays singer-songwriters (1)

tepples (727027) | about 5 months ago | (#45591705)

Artists aren't paid by radio stations.

They are if they write their own songs. The station pays BMI, which pays the music publisher, which pays the songwriter.

Why should an Internet equivalent pay?

Because it's a digital transmission. There's allegedly more of a risk of a home audio recording substituting for a purchase if it came from a digital transmission than if it came from FM radio.

Re:They're promoting you; artists should pay Spoti (1)

gl4ss (559668) | about 5 months ago | (#45591977)

what the fuck you're talking about?

radio plays are for example finnish artists the main source of income(for those lucky enough to be popular enough to get played).

that's how the copyright mafia operates. you play something outside of your private space you're going to pay to the copyright mafia and they then pay some amount of it to artists based on a formula they came up(mainly the formula goes so that the top radio played artists get the most). heck, even if you play your own songs you have to pay!(if you signed up to the system - and no, leaving the system isn't simple) and then get paid back, maybe, by the copyright mafia.

And radio pays how much? (0)

Anonymous Coward | about 5 months ago | (#45591571)

#radio stations x #listeners of each station x #plays of song = $0 royalties for performers. So Spotify still pays more to performers than ALL radiostations combined in USA.

http://en.wikipedia.org/wiki/Music_radio
"Music radio stations pay music-licensing fees to licensing agencies such as ASCAP and BMI in the United States or PRS in the UK. These fees or royalties are generally paid to the songwriters; the musicians themselves typically do not get a cut of radio royalties, even if they own a share of the performance rights, unless they wrote the song themselves."

http://www.artistshousemusic.org/news/the+tangled+web+of+terrestrial+radio+artist+performance+royalties
Broadcasters in the U.S. have traditionally only paid royalties on the public performance of a composition to the appropriate performance rights organization (ASCAP, BMI, SESAC). This money is then paid to the writers of the compositions. Unlike most other western nations, broadcasters in the U.S. have never compensated the artists themselves for any public performances.

Competition (0)

Anonymous Coward | about 5 months ago | (#45591577)

A couple of things. First, a platform like Spotify opens doors for a lot of artists that would never get airplay - but that's a two edged sword because that means that there are, in fact, a lot more artists available and thus more competition, so each artist will make less on average. Second, why in this day and age would any artist give away electronic distribution to their label? Seriously, what are they thinking? Discs aren't coming back, so if you're thinking about music as a business you need to focus on scarce goods (performances, merchandise, etc), not digital recordings.

And, as has already been said, if you don't want your music on the service, pull it. I miss Zeppelin and the Beatles, but not enough to move away from Spotify.

Goldmine compared to radio (4, Interesting)

EmperorOfCanada (1332175) | about 5 months ago | (#45591581)

I am not saying that spotify money is enough. If anything it sounds like they are just another group exploiting artists but if I understand they are still a goldmine compared to radio. These artists are saying that they got some crappy little payment for 1 MILLION listens making it seem like they were ripped off and that 1 million is a huge number. But 1 million would be a normal number listening to a NY radio station at primetime and the same artist would be all chuffed that they are in a NY radio station's prime time rotation. But that radio station would be paying peanuts for that.

I suspect that this is why some of the more "successful" (I'm not saying good) artists just tour tour tour and can barely be bothered to politic their way in to the top 10 charts. This way they have much more control over the money. If some promoter tries to set up a concert where the artist is getting shafted then they just won't show up. Worst case contractually they will just get "laryngitis".

I have read an interesting thing about iTunes though. Many dead music libraries from decades ago suddenly became viable with iTunes. Some artists who charted in the 60's and 70's said, "I haven't had a royalty check in 15 years even though I hear my stuff on radio every now and then. But after I put my stuff on iTunes I'm now getting around $30,000 a year."

So one of the things with Spotify being ragged on by the artists might come from the fact that the numbers are presented to the artist making it clear that they aren't getting much money. Whereas their other distribution channels are much cloudier so they don't know how badly they are being screwed.

Re:Goldmine compared to radio (1)

AvitarX (172628) | about 5 months ago | (#45591943)

Just like when CDs came out, and Tapes, people replace the old media with the new, and people get a boost.

I suspect spotify will drag out the curve some, because the radio play side will pay more.

Well... (2, Interesting)

Anonymous Coward | about 5 months ago | (#45591583)

How do Spotify royalties compare to broadcast royalties [billboard.com]? Which at least in the U.S. apparently amount to 18 cents per 1000 listeners (or $0.00018/listener, or if my napkin math is right... 1/33 of what Spotify pays per listener?)

Doesn't seem like new media's getting rich, either. Do any of these services turn a profit?

What's a stream? (4, Interesting)

Solandri (704621) | about 5 months ago | (#45591617)

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.

If a "stream" is a single person who listens to the artist in a month, then yeah 400,000 'plays' is a bit onerous.

If a "stream" is a single song listened to once, and the artist has (say) 10 reasonably popular songs, then only 4,000 fans worldwide listening to each of those songs once every 3 days would be enough for the artist to live comfortably. That doesn't sound too bad.

Re:What's a stream? (1)

Firethorn (177587) | about 5 months ago | (#45591701)

If a "stream" is a single song listened to once, and the artist has (say) 10 reasonably popular songs, then only 4,000 fans worldwide listening to each of those songs once every 3 days would be enough for the artist to live comfortably. That doesn't sound too bad.

I figured that $3.3k/month for 1 album(~10 songs?) per the article was a touch high, but you mention 10 'reasonably popular' songs, and there's usually only one of those per album. So ~100 songs, 10 good enough to listen to fairly frequently, that's about right for a reasonable living, especially if you figure that other revenue streams(live performances, merchandise, other services) pay for the business expenses(studio*, editing, instruments, etc...)

*It's easier than ever to set up a home studio, but setting up one good enough for broadcast quality still costs money. Renting is still an option, but again expensive unless you get lucky.

Re:What's a stream? (1)

SydShamino (547793) | about 5 months ago | (#45592165)

Well, one reasonably popular song per album (instead of ten) is the fault of the artist, not the fans. A professional musician needs to be able to work 40 hour weeks for 40 years, just like other professionals, and save for retirement, all while producing work that people want to buy. If they can't do that in their chosen profession, they need to find another profession, and give up music or treat it as a hobby.

(Yes, this is true for plenty of creativity-based professions too.)

the problem is labels (0)

Anonymous Coward | about 5 months ago | (#45591671)

everyone can sit and whine about how much services pay per play, or per stream or per mathematical formula result. but 70% of the money is given to the rights holders. whether thats 7 dollars, 7000 dollars or whatever. the problem is that if you give 70% to a service like a label thats supposed to get you radio play and tv, when both of those mediums are obsolete, thats a broken system. why not give 70% to the ice makers and switchboard operators? the internet allows you to take your ideas, with a few dollars invested in a bit of hardware, possibly some software and turn your song from a dream into a reality, toss it on the old youtube or vimeo or something, spam it on facebook, hammer the point home on your twitter, your tumbler, your vine and your google plus (lol, basically none of these services i have) after contacting pandora or spotify to host your music and you can make money like everyone else trying to peddle something. spotify's weird math i see as a bit off but regardless. there is only 100 units, they take 30 and give your pimp the other 70, then you cannot complain. you're the one with a pimp. where else am i going to hear your music? on my AM transistor radio? lollers, either the subscription price must go up (we can already listen on youtube, etc) or subscription dollars must go up by more subscribers (here's hoping...price must be low. international markets must exist which in my country i dont think i can get pandora or spotify or apple music whatever its called etc, so its not my fault). though i do pay for a few of the media streaming services and proxies, tor, etc whate i need to. or artists can quit whining. if you play the latest dubstep hit on an obscure AM station mostly dedicated to agriculture and country music, no matter how many people hear it, certainly almost nobody was looking for it. internet radio should be all encompassing, but with media export restrictions, media import laws, lack of support on some platforms (beyond a website) causes it to be analogous to the same AM station playing agrinews and stompin tom

more plays = more $$$ (1)

alen (225700) | about 5 months ago | (#45591675)

how are they getting hosed if no one listens to your music? if lady gaga gets more listeners than an indie band why should they get paid the same?

The Alternatives? (2)

enter to exit (1049190) | about 5 months ago | (#45591723)

So what are the alternatives? They can pull their music out of these services and get $0. If Spotify (and the like) give them more, we pay more. I don't think people are willing to pay more than roughly $10.00 a month for these things.

Artists will never say they have enough money, and people will never say they want to support artists - that is until they have to put their money where their mouth is. If spotify doubles their fees how many people will stop subscribing? Spotify already pays 70% to artists/their Representatives.

Content producers don't control their distribution medium anymore and people are used to free (or cheap) content. How much is Art worth? Should a good album make musicians millions? Why? The days of $20.00 albums are over - were they ever justifiable?

Perhaps Artists should lower their expectations - Artists should be grateful to services like Pandora/Spotify the alternatives aren't great.

Re:The Alternatives? (1)

enter to exit (1049190) | about 5 months ago | (#45591745)

Correction: ...Artists will never say they have enough money, and people will never stop saying they want to support artists...

Meet the new Boss (0)

Anonymous Coward | about 5 months ago | (#45591747)

same as the old boss

Let's face it (0)

Anonymous Coward | about 5 months ago | (#45591775)

Art is not meant to be a job that brings in money.

Art is meant to be art on its own.

People who bitch about not earning money from their art are not artists.

Those people are called industrial entertainers.

If i make bricks and people won't buy my bricks products then no one gives a flying fuck.

Copyright = AIDS

are you kidding? (1)

Rutulian (171771) | about 5 months ago | (#45591787)

400,000 plays?

Ok, let's stop and think about that for a moment. If you are a serious enough musician that you intend to do this professionally, let's assume you have put up at least 1 album, which for the sake of argument is about 10 songs. Spotify has 24 million active users, http://press.spotify.com/us/information/ [spotify.com]. So to make the 400,000 play cut, about 2% of Spotify's user base has to listen to at least one of your ten songs per month. That does not seem unreasonable to me. If you can't make that cut, the professional music gig probably isn't going to work out for you, sorry.

Am I missing something here?

Re:are you kidding? (1)

John Bodin (189895) | about 5 months ago | (#45591861)

My question is how much of a song needs to be listened to for it to be counted as a play, there are at times when I put on Spotify Radio that I skip ahead on a song after maybe 5 to 10 seconds of it being played. Does that get the same amount of payment as if I had listened to the entire song?

Re:are you kidding? (1)

SydShamino (547793) | about 5 months ago | (#45592183)

My understanding is that yes, they get paid for it, which is why (on Pandora at least) you can't skip more than X songs per hour. (Or at least you couldn't in 2008, back when I was training my station. I rarely skip anything now since it plays exactly what I want to hear at work barring the occasional new song that doesn't quite fit.)

Re:are you kidding? (1)

Anonymous Coward | about 5 months ago | (#45591969)

So to make the 400,000 play cut, about 2% of Spotify's user base has to listen to at least one of your ten songs per month. That does not seem unreasonable to me.

Are you kidding? 2 percent of Spotify's entire user base has to listen to one of your songs every month? Dude, that means you're got a star act.

Re:are you kidding? (2, Interesting)

Anonymous Coward | about 5 months ago | (#45592269)

some quick math.....
Numbers pulled from the web, SEC etc.

24million active users
Assume advertising covers itself for free users.

6,000,000 active monthly pay users

$15,000,000 @ $5 a month (assuming 3,000,000)
$30,000,000 @ $10 a month (assuming 3,000,000)
$45,000,000 / month in cash

20,000,000 song database

$2.25 per song per month to split up

Figure a bell curve distribution of popularity and its easy to see that the vast majority of songs in their library aren't getting much at all.

48 songs per day (assuming 4 hours of listening)

Please check out the still relevant info graphic from InformationIsBeautiful.
http://www.informationisbeautiful.net/2010/how-much-do-music-artists-earn-online/

Anecdotes.
My friends have a fairly successful religious music group that is not signed to a label. They make enough to have 4 members happily employed and have houses paid off etc. in their first 4 years.
They say that in the last year, there has been a sharp down turn in digital purchases through iTunes amazon etc.
Most of their money comes through song licensing these days instead of sales and they are having to rethink their whole business model to keep it going.
they have always made a laughable amount of money through streaming. Last year was $28 for spotify.

People pay for a streaming service and then they reach a content saturation point.
They also consume their content differently, nobody i know uses spotify/pandora and then switches to play an mp3 on their device for 1 song and then back, they are locked in, they just press "next" until something comes up.

It is obvious that it is hurting artists bottom line.

Some may say "Who do these bastards think they are to earn so much for so little?" let me tell you, for an indy band it is years of work to finally make it. so you have to aggregate the cost over the time it took to master your songwriting and musicianship at high financial risk. working at a factory for years to pay the bills so you can come home and write. If you spread the money they've made over the past 4 years over the 11 that they have put in to "Get there", it's more of a median wage with a high faillue risk.

That said, there are a lot of undeserving whiny jackoffs out there regardless of profession.
-S

Supply and demand (3, Insightful)

Subm (79417) | about 5 months ago | (#45591837)

Supply and demand aren't exactly on their side either, as there are a lot of people making music out there.

It's tough to fight supply and demand for pricing.

On top of that, a lot of guys in bands get groupies, which probably motivates many of them. Throw in free beer and free admission to the clubs they play in and you're going to have a hard time decreasing the supply of music.

Re:Supply and demand (0)

Anonymous Coward | about 5 months ago | (#45592013)

The entire perspective of this article is wrong. The correct economic model is the price paid by consumers for either the marginal play (one additional song played) or the aggregate plays per period of time. What the artist receives as compensation is irrelevant because the pricing pressure is downwards towards zero when music has to compete with free content and other activities. The ad revenue business model generated by getting many people to listen forces an editorial distribution of music geared towards the least common denominator, but a subscription payment model allows for customer selected music. When consumers pay a flat monthly rate they will play as much as possible, but their selections will still be based on marginal cost. The best outcome for the artist does not depend on the pricing, but on the business model selection.

Musicians are meant make a living from conerts (1)

jschledermann (714594) | about 5 months ago | (#45592029)

Music videos and cd's are meant to be promotional tools to get people to go to concerts. The entire music business has spun totally out of control. First of all its not meant to be a business in the first place. You are not supposed to get rich from playing music. You are supposed to be gratefull if you can get by by playing music. If your sole purpose of being a musician is to get stinking rich, then quit and become an investment banker. There is a reason why its called music: thats because you are playing and not working. The folks complaining about Spotify should be happy that there is a mefium available which allows them to reach millions of people for free

rack of VM's for making $ (1)

jsepeta (412566) | about 5 months ago | (#45592085)

I should build a rack of VM's and configure them to play my songs over and over and over. that way i could actually make some money on spotify.

$3,300 per month divided how many times? (0)

Anonymous Coward | about 5 months ago | (#45592107)

That's almost $40,000 a year. That's decent money, assuming the band consists of one person. But usually it isn't. 5 people in the band is $8,000 each, which considering the time spent recording mixing and promoting it, probably is not that great an hourly rate. Include practicing, and it's a really crappy hourly rate. Until you include the record companies cut. Then it's rapidly approaching zero, if not already there.

Re:$3,300 per month divided how many times? (2)

SydShamino (547793) | about 5 months ago | (#45592195)

If five people are only able to produce one "hit" in a given year, and the hit fades so fast that it doesn't earn residual income in future years, then maybe they're in the wrong profession? Maybe fire the three that don't write music or lyrics and bring in three more creative types who can both write and play? That would result in more overall hits and more money for all of them. Or maybe the one creative guy should hire studio musicians for the other four spots, only have to pay them $1000 each once to make the recording, and then pocket the other $36,000 for himself.

Re:$3,300 per month divided how many times? (1)

Opportunist (166417) | about 5 months ago | (#45592331)

Erh... don't get me wrong, but I happen to have a little insight in various indie music productions. If you only squeeze out a song per year, "slacking" would be a term that you don't deserve without offending slackers. Also, don't expect to be paid practicing. I didn't get paid learning to program, and I doubt a lot of people got paid while learning what they are doing.

Unlike me, they also don't have to maintain their music to adjust and mend problems. If anything, they re-release the same crap a few years later redressed in the hope that they get to sell the same junk once more. Try that in programming, people will (rightfully) complain that they already paid for the program and now should pay for the update.

If anything, this whole story shows the feeling of entitlement content makers display. Milking something done once forever isn't good enough if you just got 3k a month out of it, it seems.

Voluntary payments! (2)

Engeekneer (1564917) | about 5 months ago | (#45592209)

I'd really want to see some Spotify - Flattr integration (and in that case, better Flattr adoption), so that you could voluntarily and automatically pay more to the artists you listen to. You can replace Flattr here with any "Automatically-share-a-monthly-fee-between-the-artists-you-listen-to System"

What's does basic Spotify cost? 5€ a month? Out of which maybe 1-2€ go to the artist? If I could direclty add 10€ per month to be spread directly to the artists I listen to as voluntary donations, I'd gladly do that. That would be 15€ a month for me, which I think is reasonable (~price of an album per month). If even 10% of spotify users would do this, it would roughly double the artist income. Even making small donations easy {~2€/month) could have a huge impact.

I'm sure I'm not the only one who would gladly pay a bit more.

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