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Justice at Spotify

unionofmusicians.org

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Re: Justice at Spotify

#191

Post by robbyking »

cratermoon wrote: post #73
Eridrus wrote: post #27

So I wanted to try put this into perspective since "a penny per stream" is intentionally meant to sound insignificant. This seems like it would roughly double Spotify's costs: https://www.republicworld.com/technology-news/apps/how-much-... And Spotify is already paying out 75% of it's revenue to royalty holders: https://www.rollingstone.com/music/music-features/spotify-pr... So unless you believe that Spotify is bad…

> And Spotify is already paying out 75% of it's revenue to royalty holders Realize that the royalty holders are not the musicians, but typically the major labels. The musicians get virtually nothing.

I think this is the main thing most music fans (and young musicians) are forgetting: historically, musicians have never made money off of album sales, labels have. Musicians make the bulk of their money from touring and merchandise.

Steve Albini does a good job of breaking it down here: https://thebaffler.com/salvos/the-problem-with-music.

FTFA:

> For the average band, a $250,000 advance (in 1993 dollars) is distributed like this:

> Record company: $710,000

> Producer: $90,000

> Manager: $51,000

> Studio: $52,500

> Previous label: $50,000

> Agent: $7,500

> Lawyer: $12,000

> Band member net income each: $4,031.25

Re: Justice at Spotify

#192

Post by notriddle »

_jstreet wrote: post #187
mattnewton wrote: post #167

Earlier quoted context omitted.

Spotify doesn’t seem like a monopoly that has pricing power; they are in tight competition with multiple streaming services like Apple Music and amazon close behind and catching up. There are some sources that have Apple Music already with more paid subscribers than Spotify, and Spotify definitely can’t pay a penny per stream of their free ad users. https://www.statista.com/statistics/653926/music-streaming-s... http…

> Spotify doesn’t seem like a monopoly that has pricing power I'd argue that all music-streaming services have very little pricing power! Streaming services rely on being an easier/friction-free option as opposed to piracy (or alternatively, buying the copies directly from the musicians). Your point is still valid though, the competition is still fierce; Amazon, Tidal, Apple.. etc.

They're also competing with FM radio.

Re: Justice at Spotify

#193

Post by tgv »

s0xTester wrote: post #56
101008 wrote: post #19

Earlier quoted context omitted.

If this is not sustainable for the artists, how is this different than piracy? I'd say it is even worse, because people is paying but the money goes to a middleware company that is not paying the right price. It is like buying CDs from the street sellers.

I mean....radio was never a money maker for acts. It was to get their name out their to make money elsewhere. Just kinda how the market is setup. I don't think it is unsustainable for artists. I fucking hate "exposure", but that is literally what radio/streaming is is. It is never a substantial revenue stream until you hit big. And with today's tech, radio had to become streaming. Paying a penny per stream is highly…

Streaming isn't comparable to radio. If a penny per stream is unsustainable, perhaps we better go back to just radio. Hyping new music isn't going to do shit about revenue.

Re: Justice at Spotify

#194

Post by rsstack »

nindalf wrote: post #106
robkop wrote: post #91

Earlier quoted context omitted.

Taking a look at their most recent financial statement we can do some quick calculations. (All figures in million euros) Revenue Cost of Revenue Profit Premium : 7135 5126 2009 Free (ads): 745 739 6 Overall : 7880 5865 2015 Now currently the claim is that they are paying out $0.0038 per stream and we want to raise that to $0.01 which would be a 2.63 multiple. For spotify free that would mean that they just have to in…

This is good analysis. Small quibble with the last part - we don't know how much the price charged to consumers needs to increase to be able to afford $0.01 a stream. Any increase in price will see a drop in subscribers, dropping revenue. An increase in price could reduce revenue, making it harder to afford the increased payout.

Since the cost is linear to number of streams, it only matters if the premium subscribers that drop have a lower average streams/month rate than the average premium subscribers.

This assumes, like the post two levels above me, that Spotify don't need the profits for anything and just need to break even.

Re: Justice at Spotify

#195

Post by MomoXenosaga »

Eridrus wrote: post #27

So I wanted to try put this into perspective since "a penny per stream" is intentionally meant to sound insignificant. This seems like it would roughly double Spotify's costs: https://www.republicworld.com/technology-news/apps/how-much-... And Spotify is already paying out 75% of it's revenue to royalty holders: https://www.rollingstone.com/music/music-features/spotify-pr... So unless you believe that Spotify is bad…

Isn't Spotify barely making a profit?

I think the real issue here is that people just don't want to pay as much for music like they did during the golden age of the CD. Most Spotify users are still on the free tier. Blaming streaming companies isn't gonna change that.

Re: Justice at Spotify

#196

Post by mrgreenfur »

stephenhuey wrote: post #181
smachiz wrote: post #174

Earlier quoted context omitted.

Yes, ignoring all other costs isn't great. Their revenue per subscriber is also substantively lower - including free users, discounted EDU users, and family memberships. Excluding free users, it's probably ~$5 per user. That being said, Apple Music pays .75p/stream, Tidal is 1.25p/stream. They can probably figure it out.

If they cannot pay the artists more, a long-term freemium plan might not be a great business model then. If free users are seriously cutting into profits, should they change the free plan to a limited free trial? I was around in the 80s 90s and we didn't really have free cassettes and CDs and radio paid studios & artists with ad revenue. Spotify is well known enough now that it could be argued an unending free tier m…

Totally agree. Maybe spotify should look like an app store with fees in the 30% range at the top end (shopify/apple/steam). Their role is very similar: distribution and discovery. They probably could wi points giving better payouts per stream to smaller artists too, like steam does. Hopefully competition will force it down too (eg epic vs steam vs apple). We might need open access to back catalogues and not exclusive deals, but its a start

Re: Justice at Spotify

#197

Post by FireBeyond »

101008 wrote: post #19
Macha wrote: post #10

The ask is 1p/stream. I'm not sure that that's actually sustainable without a massive rise in spotify prices, given the proportion of free users and even paid users that listen to more than 1000 tracks a month. If spotify raises prices, consumers go back to piracy. I'm not sure this will have the effect they want. Let's imagine a radio station. Something medium sized, about a million listeners. They play a track. Are…

If this is not sustainable for the artists, how is this different than piracy? I'd say it is even worse, because people is paying but the money goes to a middleware company that is not paying the right price. It is like buying CDs from the street sellers.

> I'd say it is even worse, because people is paying but the money goes to a middleware company that is not paying the right price

Because of contracts the _artists_ signed, not the consumer.

Re: Justice at Spotify

#198

Post by lux »

disgu wrote: post #108
cratermoon wrote: post #73

Earlier quoted context omitted.

> And Spotify is already paying out 75% of it's revenue to royalty holders Realize that the royalty holders are not the musicians, but typically the major labels. The musicians get virtually nothing.

The fact that they're showing up at Spotify's offices then shows even more why they're not making money. They seemingly don't understand the business they're in... at all. They sign shitty contracts that leave them with "virtually nothing" and then complain to someone who is not responsible for them having "virtually nothing".

Unsigned artists don't sign anything with labels but we do agree to Spotify's terms, and those terms take from us and hand it over to major labels.

If a user pays $10/mo and listens to nothing but indie streams, those indies are getting far less than $7.50 (more like pennies) due to the way they calculate their payouts. The major labels pocket the majority of that money.

Spotify have the ability to change this, but not the will to do so, because the major labels own a stake in them. Soundcloud recently launched a payment model that matches pretty much exactly what indies are asking Spotify to do, so we know it's possible but Spotify have been stonewalling indies about how it's too complicated for years.

Re: Justice at Spotify

#199

Post by mikepurvis »

Cthulhu_ wrote: post #160
Eridrus wrote: post #27

So I wanted to try put this into perspective since "a penny per stream" is intentionally meant to sound insignificant. This seems like it would roughly double Spotify's costs: https://www.republicworld.com/technology-news/apps/how-much-... And Spotify is already paying out 75% of it's revenue to royalty holders: https://www.rollingstone.com/music/music-features/spotify-pr... So unless you believe that Spotify is bad…

According to one source [1], Spotify users stream on average 25 hours a month. Assuming an average song is 3 minutes [2], that's 500 streams per month. Going with the $9.99 per month rate, users pay about $0.02 per stream. Currently, the artists see only $0.0038 per stream, or less than 1/5th of what Spotify makes. I think that with a 50% profit margin, Spotify should be very happy. Of course, it's not that easy / st…

The other issue that has been raised a number of times is that I believe the revenue is still divided up based on overall listens across the platform, which means it's dominated by artists who feature heavily in popular playlists and automation-driver radio/recommendations.

These listens are often passive and should not be considered as valuable as those of someone listens only a few hours a month, but spends all of that time listening to specific artists (indie or otherwise).

Basically the argument is that if I spend $9.99 on a Spotify sub, the entirety of that cash (minus Spotify's cut) should be directed to the actual artists I listened to.

Here's an articulation of this perspective from 2014: https://medium.com/cuepoint/how-to-make-streaming-royalties-...

Re: Justice at Spotify

#200

Post by MomoXenosaga »

cratermoon wrote: post #73
Eridrus wrote: post #27

So I wanted to try put this into perspective since "a penny per stream" is intentionally meant to sound insignificant. This seems like it would roughly double Spotify's costs: https://www.republicworld.com/technology-news/apps/how-much-... And Spotify is already paying out 75% of it's revenue to royalty holders: https://www.rollingstone.com/music/music-features/spotify-pr... So unless you believe that Spotify is bad…

> And Spotify is already paying out 75% of it's revenue to royalty holders Realize that the royalty holders are not the musicians, but typically the major labels. The musicians get virtually nothing.

Well musicians do voluntarily sign the contracts with major labels. And they do get payed for it.

https://www.npr.org/2020/12/07/943818966/bob-dylan-sells-son...

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