Spotify mulls Swift change of policy – we can stream Taylor, but we'll charge Spotify has reportedly been considering a major policy change to its music-streaming service, by allowing big name artists to release albums on the platform only to paying customers. It comes after Spotify's chief Daniel Ek very publicly dissed pop star Taylor Swift late last year, after she pulled her catalogue from the …
I am with Taylor Swift and every artist who has had the balls to defy their big record label and tell Spotify to take a hike.
It is obvious from the pathetic royalty statements that Spotify and the others exploit the artists who will earn them billions when they IPO. If Ek wants her music he should pay the going rate. And she should be able to set it.
The going rate is what someone is prepared to pay you for it, what you think it's worth before you will sell it is another issue entirely.
Sadly for music what portion of disposable income people will pay has become massively diluted with phones, apps, computers etc eating into their share.
Historically (last 400 years say) being a musician has never been a great earner for most artists, the fact that they had a golden age of earning in the 20tg century is no garuntee.
In the "golden age" of the 20th century you needed a massive publishing arm to produce a hit record, it was expensive and required investment. Today you do not.
Not that the existing publishing companies will admit that. They need to spend a fortune to publicise to the world, to make "Super Stars". Where as the truth is there are plenty of local artists and bands every bit as good as these saccharine idols.
Do allow me to play devil's advocate for a moment. If it weren't for the labels and music streamers like Spitify, how would an artist's works get to the public? There's a huge backend for any musical piece.
But yes, royalties should be fair and equitable and the creative accounting of the labels should not be allowed. The is some common ground somewhere for the artists and those marketing/using the music for profit.
How does anybody get famous? Mostly luck. If you are in a lull, then your work has more chances to be noticed.
Unless you have great talent, by which I mean more than 90% of famous artists, then you're playing roulette for your fifteen minutes of fame…
Marketing paid for by labels does have a lot of influence in who becomes famous, but not really on the average quality.
@Mark 85:"If it weren't for the labels and music streamers like Spitify, how would an artist's works get to the public?"
The way the good bands of the past got famous. The Beatles played clubs for *years* before a record deal. 30 years later so did Oasis!
Today there is the "ringtone" generation, where nice catchy dance tunes are made by sampling the same sounds again, and again. For example, I have seen Jay-Z live and "Empire state of mind" was nothing short of awesome. Seeing a live band playing..superb.
But then again, I saw Sir Paul McCartney in June and he played for 3 hours in a basketball venue. Not shabby at all, and I was happy to pay the equivalent of the entire Beatles collection to see him!!
We live in an era of artificial scarcity, since all media markets are many times saturated. The only natural scarcity is material that has not been performed, and this is a wavefront moving into the future. Hence, you want to make money, be a decent live act.
There are very few artists that are "worth" $20/CD. Those that are worth it should be free to charge what they want...
...just don't expect anyone to pay it.
P.
I was (still am) a fan of the Grateful Dead. Back early on, they were local then once they got widely known still played for relatively (for the time) low gate prices. Their marketing was simple: make a recording at a concert and share it, but you can't charge for it. It worked for them as people after hearing the "pirate" wanted to buy the professional version with better quality.
I do tend to be a devil's advocate though since many of the classics in warfare (and everything in the business/corporate world is warfare if you look at that way) say to "know your enemy better than yourself".
At the end of the day, who is screwing who?
No one (that I am aware) has disputed the 3billion Spotify say they paid to **rights holders**.
If only a small fraction of that money is getting to the actual artists, then they need to complain about the contracts they signed. Of course when they were being paid big advances they didn't complain did they?
> Practically no artist in the music business gets paid a big advance. What they get up-front is spent on recording/filming videos etc. and it all has to be paid back before the artist makes any money.
Yes, the "advance" is a scam. The money is provided (nominally) to the artist - who, as you say, immediately has to spend it on record company activities. When it comes to royalties, however, the record company takes a cut ... to cover record company activities.
Practically no artist in the music business gets paid a big advance. What they get up-front is spent on recording/filming videos etc. and it all has to be paid back before the artist makes any money.
That's what an "advance" has always been - the band pays for the activities they use. The advance is merely working capital.
Historically, a few bands have gotten into serious trouble because they believed the advance was free cash to play with as they see fit...
That said, many of the things that a record company did 50 years ago are now so cheap as to be barely worth costing. But that doesn't affect the charge.
Vic.
I wouldn't play that teen angst pop twaddle if she paid me . I made the mistake of purchasing an album for my wife after she expressed a passing interest . It was a totally unlistenable pile of 4 bar recycled disco crap. I don't mind if they put the pay option , people will vote with their wallets and rest assured mine shall remain closed
You are slightly missing the point. It is still the radio model, just the satellite one, not pay per play.
So people will not be actually voting with their wallets any more than they vote now. The only difference is that Spotify will be able to afford the rate she is asking. Based on the spat so far it looks like they cannot get enough money off ads to pay her for putting her songs on the ad supported service.
This shows one of the breakages of the Spotify model. Radio stations in most places around the world manage to survive by having relatively "local" ads. Even national radio stations change the ad payload based on the region where it is transmitted. This does not quite work with Spotify and Co because they have not set up local representation to sell ads and their delivery precision in most countries is on a per-country basis, not on a per-region basis. So the biggest money earner for a local radiostation (the local trade ads) does not work for them.
"Based on the spat so far it looks like they cannot get enough money off ads to pay her for putting her songs on the ad supported service."
Sounds plausible - so on the face of it, this "windowed" approach for new releases makes sense. I'm assuming - since the article doesn't actually explain it - that the "windowed" approach means that albums released this way will only be for paying subscribers for a certain period, and would eventually be available to all users.
With that in mind, what would also make sense would be an approach whereby when a new album comes out and is available this way on Spotify, a single track from the album is also initially available to free listeners. Then perhaps another a couple of months later.
They could call these "singles" and they would effectively be an advertisement for the full album - so may help improve sales of the album for the artist, or might increase paid subscribers for Spotify if people want to hear it that way.
I want to take credit for this idea, but I'm sure I've encountered a variation of it before...
... wake up and realize they are being screwed. Why would you pour $10 a month down the drain month after month year after year with nothing to show for it in the end? Not only that but spend a bunch loiad of other cash in data charges for streaming the stuff?
Nothing to show for it? That's the typical fogey attitude that thinks paying for something is only worth it if it means acquiring property. Paying for subscriptions services means you get to enjoy the benefits they offer, such as a massive library of music on demand, new ways and means of discovering new music, no need to have a massive stack of shelves full of bits of plastic. What you have to "show for it" is many, many hours of listening to music wherever you are, sharing the new stuff you've found with whoever you're with. Back when I used to own CDs I'd easily spend more that $10 a month on music, and I've have to buy an entire album and then sometimes discover it was shite - that's wasted money. My $10 on Spotify gets me access to pretty much everything I ever want to listen to. It's a bargain.
I assume you don't pay subscriptions for anything? Sky TV? AA Membership? TV License? Broadband? Phone? Etc.. etc.. etc..
@FatGerman - I'm not sure if you are in the UK since you mention subscription services, but my main gripe with many US-based services is still the pound to dollar exchange rate...
Google Play Music may be $10 for some but £10 is way more than $10 + 20% VAT
I've not looked at Spotify charges recently - I use TuneIn Radio for free to user services (and tend to ignore services like Jazz.com and DI which won't allow streaming apart from via their own Apps).
Back to the US v UK / EU pricing, only the other day did I notice a site with $30 monthly fee and of course the "to be expected" rip off £30 UK fee. Sure, it was a porn site, but just a further example of why some services will never get my business (it's not as if the US funds the undersea connections either - costs for traffic is paid for by countries at remote end of link, passed down to ISPs, and then us users).
> Back when I used to own CDs I'd easily spend more that $10 a month on music, and I've have to buy an entire album and then sometimes discover it was shite - that's wasted money.
Except you could sell it on, because under that model you were acquiring "property".
Sky TV? No.
AA Membership? No.
TV License? Tax, not optional.
Etc.. etc.. etc..
I can't help you with your penchant for buying shite, as I've not bought shite in several decades. Perhaps, as you are prone to buying shite, some URL and a subscription fee is sufficient for you. However, years after you've settled down on your favourite music, favourite bands, and favourite tracks, you'll still be paying $10 a month to listen to them.
As for sharing "new stuff you've found" you can do that without spotify, and "access to pretty much everything" isn't particular good, it means that unless you are disciplined in what you listen to you are at best channel flipping spending no time to savour or fully appreciate the 'new thing' you are listening to.
"However, years after you've settled down on your favourite music, favourite bands, and favourite tracks, you'll still be paying $10 a month to listen to them."
You sound as if you expect me to eventually find something I like and then stick to it without ever wanting to hear something new. Crikey that sounds boring. Music is a never-ending, ever growing playground of new stuff to listen to and like. And it's hardly channel flipping if I like spending time finding new bands and new albums to listen to - finding something new is as enjoyable as sitting back and savouring an old favourite, but it's also more exciting. That excitement I would definitely miss.
Oh I don't expect you to find something and stick to it, I know you will. That won't stop you listening to new stuff, just that the 'new stuff' won't quite be as often. I put new stuff in quotes because by and large recommendations from streaming services aren't particularly good. They recommend thing similar to what you are currently listening too. Different artist same genre which once you think about it is rather boring.
I'm only on the trial offer so far, but it's worth it I think. I never owned the music anyway, just a licence to listen. But I did have a physical medium. There is no problem having both I guess. But the service lets me find any track I can think of, great for reliving memories or enjoying entire albums.
If artistes like TS demand too high a price for their music then they shoot themselves in the foot and diminish their potential audience. Streaming services are the future IMHO and are becoming the quickest and easiest way to get noticed and build your fan base if you are a new and up and coming artiste. If established 'stars' want more of the pie they will hamper this outlet - perhaps eliminating the competition is the real reason that they are doing this.
Music revenue from the month of October 2015:
Royalties from Subscription services (51,573 streams):
$283.03
Not bad I guess but should be a bit more. That could probably feed a person for a month on a low cost diet but nothing more. I agree that an artist should be targeting more streams than that if they want to earn a living from their music.
Royalties from Ad-Supported services (1,119,136 streams)
$66.57
Totally unacceptable. Ads on TV and radio pay really high rates but music streaming is a pittance.
If anyone STILL doesn't understand why artists want their music only on the paid tier, I give up.
Anon coward because I don't want these stats linked to an artist, but they are legit.
I can understand why they'd like the higher royalty rate.. but is that for a song, or for an entire catalogue of 40 years of music.
The point being that you can reasonably expect that to be a continuous stream of income, generally increasing as your catalogue grows? And there is no further cost - yes I do get the cost of getting to that stage needs to be recouped, but...
I'll also suggest that it isn't the artists sole revenue stream. It's not as if the CD sales are zero since spotify, or the concerts have noone at them...
That is per song (1 stream = 1 song). If you are a DJ and make a mix album you get the same amount for a single stream of a 70 minute mix (1 track) that you would get for a 3 min song. This is another really stupid thing about streaming that the providers refuse to address. If a mix has 10 songs in it and lasts 10 times longer than a single song.... you should get 10 times the ad revenue.
Spotify says it wants to reward artists that have more streams. Basically if you read their blurb it says that the people who stream the most, get the higher percentage of the revenue. So if you are starting out, you get a far lower portion of the pie. It's all structured in favour of the major labels (who are the majority shareholders). If your music gets lots of streams, then you get a higher amount per stream. If you are starting out and trying to establish yourself your first streams get a far lower royalty rate. I just don't really understand how this helps up and coming artists at all. Why doesn't everyone just get the same amount per play? It's like tax laws... Warren Buffet's secretary pays a far higher tax rate than he does.
And if you are starting out, it's not the 60s... you are not going to be touring the country playing in dingy smoke filled bars anymore. People hardly buy CDs now. You would want them to buy downloads in their place but these streaming companies offer you all you can eat for a tenner a month - why would you spend more than that on just one album?
So if streaming really is the future, then at least they should charge the ad men a decent rate so that artists can get started. It's kind of like the housing market... any young person now hasn't a hope of getting a foot on the ladder without a lump sum from their parents.
Thom Yorke was right - streaming is okay if you are already rich and have a huge catalogue but it doesn't help breading new generations of music and it should do more... you know, since without any new music, in the future nobody will renew or buy new subscriptions.
"If your music gets lots of streams, then you get a higher amount per stream. If you are starting out and trying to establish yourself your first streams get a far lower royalty rate. I just don't really understand how this helps up and coming artists at all. Why doesn't everyone just get the same amount per play? It's like tax laws... Warren Buffet's secretary pays a far higher tax rate than he does."
Isn't that like many businesses? Those with more experience and proven success get higher salaries for the same work. When you are on the bottom of this scale it doesn't look fair: why is that teacher earning more than I am even though we both teach the same number of classes? When you are on the top of the scale it does look fair: because I know what I am doing and you don't.
But there's actually a more obvious reason. The big stars get a bigger piece of the pie because they are the reason the customers are there.
The problem here is that these are questions of 'what is an acceptable royalty rate?' This is an interesting, but irrelevant question. Spotify is offering artists a certain amount of money, and you can either say yes or no. There isn't much room for manoeuvre on Spotify's part, because they aren't making any money. So the reality is ad-supported streaming might not be profitable for you, but that amount of money is more or less the best you are going to get in that model. If you don't like it, withdraw from that model.
"Isn't that like many businesses? Those with more experience and proven success get higher salaries for the same work. When you are on the bottom of this scale it doesn't look fair: why is that teacher earning more than I am even though we both teach the same number of classes? When you are on the top of the scale it does look fair: because I know what I am doing and you don't."
In your line of work, and mine, your quality of work matures with age and experience. I don't think this really applies to musicans. Quite often the first or second album is their best piece of work in their career (I'm guessing because it's a culmination of all their ideas in the years leading up to release. Or they get rich and can no longer write songs that relate to the masses).
"The problem here is that these are questions of 'what is an acceptable royalty rate?' This is an interesting, but irrelevant question. Spotify is offering artists a certain amount of money, and you can either say yes or no. There isn't much room for manoeuvre on Spotify's part, because they aren't making any money. So the reality is ad-supported streaming might not be profitable for you, but that amount of money is more or less the best you are going to get in that model. If you don't like it, withdraw from that model."
Spotify are not making enough money because they sold out their service too cheaply. They need to increase their advertising rates. They need to convert far more of their free users to paid. "Windowing" music will go some way to achieving that. Their artists are suggesting ways to make more money for everyone and they are good ideas and Spotify should listen and embrace constructive criticism.
"But there's actually a more obvious reason. The big stars get a bigger piece of the pie because they are the reason the customers are there."
Well they are leaving or choosing not to be on there. Swift is not on there, Adele is not on there. There is a huge shortage of underground dance music. How many have to leave before there is no reason for customers to use the service? In the future the kids will not be listening to Swift or Adele. They will want the new artists. If there is no new music, then why would anyone subscribe? It's the big stars of the future that Spotify should be thinking about. Currently I don't see why any of them should agree to have their music on ad supported models. Then where would Spotify be?
"Ads on TV and radio pay really high rates but music streaming is a pittance."
Apples and Pears.
Ad's are using the music to sell a product to make money.
Streaming is for consumption.
In IT, the equivalent are business programmes costing far more than the home editions.
"To date, Spotify says it has paid $3bn in revenue to rights' holders."
This is not a particularly meaningful number. It might indicate Spotify's expense for the basic product they sell but as an indication how much real, individual, specific rights holders earn, it is more deceptive than informative.
In Re The $3bn Number:
1) How many streams has it paid for?;
2) How many artists have gotten a piece of it?;
3) How many months did it take to earn (or disburse, depending on your point of view) such a sum?; and so on.
Other meaningful numbers would be:
1) The earnings per artist, per track, and per listen, ranked by percentile;
2) The income per user per stream, track, and artist, ranked by percentile;
... and so forth.
Note that the above categories can be further subdivided by source of revenue i.e. by paying and by non-paying, free-tier users.
These would be meaningful numbers.
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