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Why Spotify Pays So Little

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Re: Why Spotify Pays So Little

#51

Post by anigbrowl »

afarrell wrote: post #12
tpeaton wrote: post #6

Spotify has been villified since the beginning, and I certainly want a more fair system to exist for artists. That said, has there EVER been a business model in the US that was profitable for artists? I don't think there was ever money in music for artists from album sales. The cost of distributing and promoting music is just more expensive than making an album.

Is it actually the case that signing record contracts was always a bad deal for artists? I was under the impression that they reduced risk for artists who could then use money from the contract as a more stable source of income to pay for, say, childcare expenses.

No, of course not. Bear in mind that most bands/artists had a manager, who took care of the business side and who earned a percentage of the payout from labels, concert promoters, etc., and was thus incentivized to get the best deal on their behalf.

Re: Why Spotify Pays So Little

#52

Post by 6stringmerc »

afarrell wrote: post #12
tpeaton wrote: post #6

Spotify has been villified since the beginning, and I certainly want a more fair system to exist for artists. That said, has there EVER been a business model in the US that was profitable for artists? I don't think there was ever money in music for artists from album sales. The cost of distributing and promoting music is just more expensive than making an album.

Is it actually the case that signing record contracts was always a bad deal for artists? I was under the impression that they reduced risk for artists who could then use money from the contract as a more stable source of income to pay for, say, childcare expenses.

No, whatever money is paid up front for the expenses (recording, shooting music video, child care while doing such things) must be repaid to the label. If you don't "recoup" enough through album sales, you have to pay them back out of touring...and on and on and on...Basically, just have a look at the following article by Steve Albini:

http://www.negativland.com/news/?page_id=17

Re: Why Spotify Pays So Little

#53

Post by adventured »

tpeaton wrote: post #44
adventured wrote: post #39

Earlier quoted context omitted.

Sure, touring and sponsorships are extraordinarily profitable for artists. Those able to attract an audience or fill venues. The Eagles made $100 million last year; Springsteen $81 million; Bon Jovi $81 million; Calvin Harris $66 million; Toby Keith $65m; Taylor Swift $64m; Bruno Mars $60m; Pink $52m; Roger Waters $46m; ... Muse $34m, Gaga $30m, this list just keeps going. Michael Buble made $1+ million per tour date…

Yes, but that represents a very small minority of artists. Most lose a lot of money or break even if they're lucky. Check out this article by Pomplamoose, who are a relatively successful band. https://medium.com/@jackconte/pomplamoose-2014-tour-profits-...

I find this to be a good examination article regarding the now infamous Pomplamoose tour breakdown:

http://www.artistempathy.com/blog/the-pomplamoose-problem-ar...

I think that doing only 24 tour dates as a mid-popularity group, while not exactly managing costs well, to be an obvious setup to lose money. If they want to treat it like a business, they're doing a terrible job of running a business.

Re: Why Spotify Pays So Little

#54

Post by jstelly »

cwyers wrote: post #5
nicpottier wrote: post #3

Is the description of Spotify's model to pay artists accurate? It sounds suspiciously simple, free of any special deals with labels to get artists on board etc... (which I had just assumed was a necessary evil) And do total stream divisions take into account only premium accounts? Or do they also include free ones? Because ya, as a premium user, I really do want (and perhaps naively expected) my $9/mo split between t…

Money to pay the artists listened to by free users needs to come from somewhere. I don't think artists and rightsholders are willing to accept a lower per-play revenue from free users. Which means I doubt that the ad revenue is enough to support the free accounts without subsidy from paid users. (The ad revenue isn't nothing, and the ads helps encourage conversion to paid user, so they're not without value to Spotify…

People make tools to game usage-based rewards in free to play games. They call it "idling". You could hack this by making an idling tool for spotify that would re-stream your tracks when you weren't using spotify.

Re: Why Spotify Pays So Little

#55

Post by smackfu »

afarrell wrote: post #12
tpeaton wrote: post #6

Spotify has been villified since the beginning, and I certainly want a more fair system to exist for artists. That said, has there EVER been a business model in the US that was profitable for artists? I don't think there was ever money in music for artists from album sales. The cost of distributing and promoting music is just more expensive than making an album.

Is it actually the case that signing record contracts was always a bad deal for artists? I was under the impression that they reduced risk for artists who could then use money from the contract as a more stable source of income to pay for, say, childcare expenses.

And remember that artists do not go to the press with stories of, "the label gave me a big advance and then the record was a flop."

Re: Why Spotify Pays So Little

#56

Post by 6stringmerc »

tptacek wrote: post #15
afarrell wrote: post #12

Earlier quoted context omitted.

Is it actually the case that signing record contracts was always a bad deal for artists? I was under the impression that they reduced risk for artists who could then use money from the contract as a more stable source of income to pay for, say, childcare expenses.

That is my understanding as well; in particular, a lot of popular mythologies about artists "recouping" and being stiffed on royalties seem to be just that: mythological. Here's a good post: https://news.ycombinator.com/item?id=3850935

Actually, it's not a myth; see the above link to what Steve Albini wrote if you'd like to get more educated and enhance your understanding of a very calculating and explotative business model.

Re: Why Spotify Pays So Little

#57

Post by JoshTriplett »

tpeaton wrote: post #6

Spotify has been villified since the beginning, and I certainly want a more fair system to exist for artists. That said, has there EVER been a business model in the US that was profitable for artists? I don't think there was ever money in music for artists from album sales. The cost of distributing and promoting music is just more expensive than making an album.

> That said, has there EVER been a business model in the US that was profitable for artists?

As far as I know, the various music purchasing services (as opposed to radio or rental services) directly pay the artists a fraction of each purchase of their music.

And if you're sufficiently popular, you can also sell directly to decrease the overhead.

In a completely different direction, there's also Patreon and other patronage-model sites.

Re: Why Spotify Pays So Little

#58

Post by Flimm »

Jack Stratton is correct in pointing out that less active users are subsidising active users.

However, he then makes the leap that that means that less popular artists are subsidising the popular ones, which has yet to be proved.

Re: Why Spotify Pays So Little

#59

Post by [deleted] »

thomasahle wrote: post #24

> Terry is below average. In 2014 he averaged 350 streams per month. If his subscription money only went to artists he listened to, it would’ve been $0.02 per stream. > Instead it was $0.00786. This sounds like a much better way to do it. The artists should ask Spotify to change it. However I guess the big players don't really want it changed.

[deleted]

Re: Why Spotify Pays So Little

#60

Post by 6stringmerc »

smackfu wrote: post #55
afarrell wrote: post #12

Earlier quoted context omitted.

Is it actually the case that signing record contracts was always a bad deal for artists? I was under the impression that they reduced risk for artists who could then use money from the contract as a more stable source of income to pay for, say, childcare expenses.

And remember that artists do not go to the press with stories of, "the label gave me a big advance and then the record was a flop."

Haha yeah that's technically true, because if that scenario actually happens that artist/band is effectively ruined, blacklisted, radioactive, whatever. Practically speaking though, are you aware of the "Sophmore Slump" concept at all? It's well known that after the first big success the record company wants MORE SUCCESS and that rarely happens. There are outliers like Adele, but far more often things go the way of Sisqo and "Return of Dragon" which famously had a $1 million video budget, banking on the success of "Thong Song." Guess what: Didn't recoup for the label.
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