iTunes Chart-Toppers (a/o February 21st):
Spotify and similar access models are discouraging other forms of music purchasing - not encouraging them - according to a recently-released finding from NPD Group and NARM. In fact, access has been deemed 'most detrimental' to monetization across nearly all demographic categories.
This is from the report, released a few days ago and shared with Digital Music News.
In the above slide, 'Committed' fans are the most dialed-in, die-hard music demographic, while 'Casual' and 'Content' represent the least dedicated. In almost every category, respondents indicated that access decreased their interest in discrete purchasing, sometimes by a very substantial margin.
Here's another question, posed to the top two most dedicated demographic groups. It clearly shows decreased interest in discrete purchases like iTunes Store downloads, while also correlating that to lowered purchasing overall (fairly or not).
The survey helps to confirm a growing fear for many labels and artists. That is, services like Spotify increase access, but also decrease spending in many situations. Which means less money from higher-returning formats like iTunes downloads, CDs, and LPs.
But free access also includes a range of other services, including YouTube, Grooveshark, and various freebie competitors. And all of these are sapping the juice out of higher-end impulse buying, once a music industry lifeblood. "New sources of listening, watching, and researching make it even easier for the average music fan to avoid taking 'high value' action, e.g. paying either for a CD, download, or subscription," the researchers noted.
Comments Closed
Andy Tuesday, November 15, 2011
dowhatyouwantcuzapirateisfreey Tuesday, November 15, 2011
Spotify is also detrimenal to music piracy
lost john Tuesday, November 15, 2011
Yes, that is semantically true.
But I'd venture that the same amount of revenue that spotify prevents the loss of, would be made up in merchandise, licensing and bobble-heads etc. that piracy would promote.
Also, piracy and .0017 are pretty dern close together.
Visitor Tuesday, November 15, 2011
bull turds... if spotify were detrimental to piracy, why haven't piracy levels droped, and sales increased?
Vail, CO Wednesday, November 16, 2011
Spotify always says this, but where's the data to show that piracy is actually declining?
Garrett Wednesday, November 16, 2011
There's an important distinction you're both missing: something that is "detrimental to piracy" doesn't necessarily decrease piracy on an absolute scale, i.e. cause fewer people to pirate tomorrow than pirate today. It could decrease its sustained rate of growth, however, i.e. cause fewer people to pirate tomorrow than would have pirated tomorrow without Spotify.
Here's an oversimplified analogy -- birth control is detrimental to population growth, right? So why is the population still growing? It's not that birth control results in fewer people absolutely, i.e. it doesn't kill anyone. However, it results in fewer future people than there would have been without birth control.
To say that Spotify can't have a detrimental effect on piracy, simply because more people pirate today than did yesterday, is shortsighted. It's as silly as saying that birth control doesn't work because more people exist now than did 100 years ago.
The question we should be asking is how has Spotify affected the rate of growth of piracy?
Drew I. Thursday, November 17, 2011
Hurray for logic!
Leroy Thursday, November 17, 2011
melodyhill Saturday, November 19, 2011
From a music creator's standpoint there is a more important question: Since Spotify's royalty stream to creators is undetectible by humans, ie. almost indistinguishable from $0.00, how is it better than piracy? This is not conjecture on my part. I get the statements. I do the arithmatic.
Visitor Tuesday, November 29, 2011
"[birth control] results in fewer future people than there would have been without birth control."
That's not obvious at all, without proof and evidence. For example, the existence of birth control might encourage far more promiscuity. Since birth control is generally imperfect, and human compliance is often far from perfect, the birth rate might actually increase in some cases after birth control is introduced to a population.
- Versus
Garrett Monday, December 05, 2011
@Visitor/Versus
I agree. However, you seem to have missed the part where I said "Here's an oversimplified analogy," and you also seem to have missed my point entirely. Instead of picking apart the specific analogy I chose, try to see how the general concept relates to my argument, which I'll repeat here:
It is shortsighted to say that, because more people pirate today than did yesterday, Spotify does not have a detrimental effect on piracy.
Visitor Tuesday, December 06, 2011
Point taken. Certainly agreed that Spotify can have a detrimental effect on piracy. We just don't know (yet) whether it really does.
- Versus
jf Tuesday, November 15, 2011
is it though? perhaps it is detrimental to an increase over the current level of music piracy, but i would wager that a paradigm shift has already taken place among consumers' tastes/behaviors re: music piracy/music sharing. for instance, the prevalence of USB memory sticks / External hard-drives among consumers shows that consumers are comfortable sharing (i.e. stealing/not buying) music on a large scale. so in summation, i think spotify doesn't necessarily change the way we pirate (those habits are well established) but instead it is a direct shot across the bow of new music purchases.
Stu Tuesday, November 15, 2011
But this is frustratingly only part of the story. How appealing is Spotify to people who AREN'T buying iTunes downloads/etc already? How much is it cannibalising piracy? If it gains tens / hundreds of millions of paying users, how will that impact overall music revenues?
Or, to use NARM/NPD lingo, how is Spotify monetising the non-active segment?
steveh Tuesday, November 15, 2011
The income from Spotify is so poor that any gains from people converting from illegal free downloading are massively outweighed by the losses from people stopping to purchase downloads and CDs.
Stop trying to defend the indefensible!
Stu Tuesday, November 15, 2011
What figures have you got for that - would love to see the calculations.
What I see is some artists saying they're losing sales due to Spotify, and others saying they're selling more due to people discovering their music on it.
And the real question that nobody seems to want to answer is: if not Spotify ( or Deezer, Mog, Rdio etc ) then what?
Dave Wednesday, November 16, 2011
Thats an interesting idea. I will keep an eye on this!
David_A Wednesday, November 16, 2011
steveh Wednesday, November 16, 2011
I think you will find that the strongest critics of Spotify are from indie and artist-owned labels.
dnsdds Saturday, November 19, 2011
That doesn't really invalidate his argument.
I would think the major labels get to karate chop a gargantuan slice out of the cake because they're not allowed to, they pull their content and Spotify is out of business. Indie labels lose out to bigtimers once again.
This kind of bullying is another symptom of record labels trying their hardest to still live in the past -- if Spotify got to divide their royalty pie fair and square based on number of listens alone (instead of the size of the label affecting the size of royalties per play), indie labels would have nothing to complain about.
@stacifrenes Tuesday, November 15, 2011
Staci Frenes
Depressing.
Kirsty_Hawkshaw Tuesday, November 15, 2011
if spotify paid more out it would be very much worth it, i'm not sure how it works 100% yet but yes this is interesting news
@rebeccagates Tuesday, November 15, 2011
rebecca gates
Is this a surprise to anyone?
mdti Tuesday, November 15, 2011
no, for me it's just logic in our times... like 1+1=2 (in general ;-)
JoeRap Thursday, November 17, 2011
exactly...
@ThePointKWPT Tuesday, November 15, 2011
The Point
Increased access to music decreases the desire to purchase music.
@stjamesiii Tuesday, November 15, 2011
stjamesiii
I agree with this and also uninspired packaging.
@KHUMradio Tuesday, November 15, 2011
KHUM
Yet another reason why musicians hate Spotify.
Henry Tuesday, November 15, 2011
Jeff Robinson Tuesday, November 15, 2011
Spotify represents the bottom of the Music Industry. We should all embrace it, because it certainly can't get any worse. On a side note, I queried on running an ad campaign promoting some new releases on Third Monk Records and was told by Spotify that the minimum spend for advertising was $5,000. What artist with a stable head on their shoulders would pay that price? I'll use some Third Monk Records figures here from last quarter- 21 spins paid an artist on this label .02 cents- that means, 5,250,000 spins would re-coup a $5,000 ad campaign. Who would ever advertise a record on Spotify? It's a total loss. On the other hand, consider a distributor like the Orchard that does advertise on the site- they charge independent artists and labels $35 to digitally distribute their material. That means it only takes 142 indie artists and/or labels pay for the Orchard ad campaigns that run incessantly on Spotify. The Orchard advertises their "ORCHARD LABEL PRODUCT"- on the backs of other indie labels/artists.
Sea Cake Tuesday, November 15, 2011
This headline is misleading and inflamatory.
Access means file-sharing, You Tube, Grooveshark and other ways people can get free music.
Spotify, Rdio, MOG and Rhapsody are generating revenue, just not .99 a purchase but spreading the payments over many listens over time and increases the chance poeple will discover music from others. Maybe The Beatles don't need streaming, but the bands that cry about streaming need the help, or they wouldn't be crying poor.
Audiofool Wednesday, November 16, 2011
Well said!
gaetano Tuesday, November 15, 2011
Finally.
1/2 minute Tuesday, November 15, 2011
Back to Basics
Time to load Spotify up with 1 and 1/2 minute versions of your tracks. If the listener likes them, they can head off to iTunes and buy it- SIMPLE
Michelle Thursday, November 17, 2011
great idea !!
joe Thursday, November 17, 2011
agree. sampling: good
dnsdds Saturday, November 19, 2011
Except that who's gonna pay 10 bucks a month for a collection of free previews? If even a humbug mill like Apple can't charge people for listening to 30 second samples, how's Spotify gonna do any better?
Instead, I would instead suggest doing what record labels at least used to do; you might listen to the greatest hits on radio/MTV/Napster/Spotify/Pandora/whatever, but only if you buy the album on iTunes or physical CD, you get exclusive bonus tracks and other bonus content.
Similar concept, only this decade.
Bif j Tuesday, November 15, 2011
Change is necessary! Trying to force music fans to purchase CDs or downloads is not the only answer. Evolution is evolution. I'm sure many of you probably wished 8-track tape was still a standard. The same thing happened when CDs were introduced to the labels and buying market in the early '80s. "Oh my God...a digital copy of our work will be the destruction of the industry." Look what happened, it ended up being one of the greatest profit makers for music labels and artists.
Embrace change! Learn to maximize the potential or get out the way! Technological advance is inevitable.
steveh Wednesday, November 16, 2011
OMG I'm so tired of this "This is the future - get with the program" argument!
That is the Monsanto argument!
This is not a debate about new technology - it's a debate about simple mathematics.
It's a simple concrete fact that with the payout for Spotify streams 2-300 times less than the payout for an iTunes track purchase, if people switch from buying CDs / iTunes downloads to Spotify it will represent a catastrophic decline in income for those that make the music.
Bif J Wednesday, November 16, 2011
Again...get over it. Unless you can you think of a better solution than holding on to what you can't save.
James Wednesday, November 16, 2011
It's very far from inevitable. At present Spotify needs artists more than artists need Spotify - and we've seen enough signs recently, both from indie labels and big artists like Coldplay, that many are questioning the desirability of the platform, to say the least. Also, you need to accept that it need not be an either/or situation; many artists may choose to use streaming services for album samplers only, or just singles, or stagger their releases so that they find their way onto the platform only at a later date. But what happens from here on is very much still in the artists and labels hands, and simply saying 'get over it' shows a lack of understanding of both the options and the economics.
Recorded music used to be for Thursday, November 17, 2011
Most people could only afford a few CDs a year. Now you can listen to everything, for free. And there's nothing the rights holders can do about this. Get over it.
David_A Wednesday, November 16, 2011
Versus Tuesday, November 29, 2011
"Technological advance is inevitable."
Very optimistic, but civilizations do all too frequently decline, technology, culture, and all.
- Versus
Los Tuesday, November 15, 2011
SCALE!!! Access models are not a margin play. Obviously CDs and downloads generate a higher margin per unit. Access and subscription models are a VOLUME play. Significant volume has to be hit before a proper comparrison can be made. Once significant scale has been achieved, prices can be altered and thus profit margin per unit can be adjusted. Like the cable companies who raise prices every so often. Consumers are hooked and they will not unsubscribe with slight price increases. (and no, Netflix is not a good proxy. They don't have every title). Similarly, consumers will not leave Spotify once they have committed and built playlists and are completely engulfed in the ecosystem. These studies are meaningless. It is too early to make conclusions.
gaetano Tuesday, November 15, 2011
Fortunately, it's not too early to see that even if it did reach a decent volume the Majors will take the lions share of all revenue regardless...
steveh Wednesday, November 16, 2011
Not just the majors - Spotify itself will take the lion's share.
Spotify will become the major of majors.
A frightening prospect when you see the Spotify's shocking lack of transparency about income for artists and indie labels.
Vision? Wednesday, November 16, 2011
Spotify itself doesn't have plans to become "major of the majors". It's just another financial scheme to get investment money and get out at the right moment.
Search online for articles related to the Last.fm original team's tactic.
Chris Duncan Wednesday, November 16, 2011
Majors have always had the lions share of revenue... because they tend to have the biggest artists!
mdti Wednesday, November 16, 2011
and the biggest catalog of bigger and smaller artists.....
Visitor Wednesday, November 16, 2011
"scale"?
why are you going on about scale? one of of the characteristics of indie labels / artists is that they don't have scale. That's kind of the point.
If you're saying that spotify can only properly be judged if youre getting 1 million - 5 million plays per month then you're already saying indies should stay well away from it because that's just not going to happen
Gigs, Merch and recommendation Wednesday, November 16, 2011
I've lost count of the amount of bands I've either gone to see or bought merchandise from after listening to them on Spotify.
Also Spotify makes it very easy to share recommendations to my friends that I know have since gone on to buy CD's and gig tickets etc as a direct result.
sigh Wednesday, November 16, 2011
and yet how many bands whose music you've listened to have you NOT seen live or bought merch from, because they aren't touring near you? the bands you will never see live far outweigh those you do. out of a 100 bands you listen to a year, you probably go to no more than a dozen gigs a year. give those other 90 artists your 10 bux.
JoeRap Thursday, November 17, 2011
that's merch. as a promotional vehicle, spotify is fine. but not as a sales driver for reocrded music.
Jim Donio Wednesday, November 16, 2011
Paul Resnikoff's citing of Spotify in this story is incorrect; no specific access services were named in the NARM/NPD report, and in fact Spotify had only just launched in the U.S. when this survey was conducted. There are many different types of music access models, and licensed services such as Spotify, which do pay royalties for the music on their services, are an increasingly important part of the mix of digital retail options for consumers.
paul Wednesday, November 16, 2011
Jim,
I'm not sure I follow the logic at all? Spotify is one of the largest access models out there, with a very large free userbase to boot. It's at the center of this debate, and very much a member of the access group the report studies.
So, if you're doing a study on four-legged furry creatures at the Bronx Zoo, and it was done before the arrival of a certain European bear, is that European bear somehow not subject to the conclusions of that study?
Eager to hear your response.
/paul (author of the article)
davidcbalfour Wednesday, November 16, 2011
so, if spotify was only barely launched when this survey was made, doesn't it follow that there were no significant free-to-access streaming music options for US consumers at the time that this survey was made. and the survery must therefore be talking primarily about paid access models?
so does this nor survey merely tell us that those who were already paying a subscription fee for access models were less likely to pay again for downloads? If so, this is not exactly surprising is it.
clarification any one?
Howard Wednesday, November 16, 2011
How much do the top 10 Spotify executives/employees make per year?
Steve Wednesday, November 16, 2011
How much do Apple's top 10 executives earn a year?
Maxwellian Wednesday, November 16, 2011
THe APple question is easy to answer. But Spotify I think has filings in Sweden and/or UK that may answer your question.
Visitor Wednesday, November 16, 2011
who gives a ****?
HansH Wednesday, November 16, 2011
Wow. This is a surprise!
Read this article:
I Quote:
"Streaming wins. It’s just a matter of when.
So LOWER the price of MP3s. If you think people will be listening to 256 AAC files ten years from now you’re probably still skiing on straight skis, you drive a car without a catalytic converter. The songs at the iTunes Store suck. Bandwidth is going to improve and even if ownership were to win, people would pay again for higher quality. We saw this with the transition from vinyl to CD, do you think it’s really any different here?
Access wins over ownership. Which is why streaming wins. No one owns a house big enough to hold everything he wants to consume. Which is why it’s stored remotely online for when you need it, that’s the concept of the cloud. You pay for the ability to use, not to own. Ownership is cumbersome, it ties you to the past. Hell, play any of those 8-tracks or cassettes recently? If you’re a Spotify subscriber and bandwidth and streaming rates improve, you benefit, you’re not locked into 320."
I couldn't have said it better..
Lost John Wednesday, November 16, 2011
Ownership is cumbersome?
And so is freedom, personal sovereignty? I'm not being alarmist for the sake of, but think of the implications involved in renting access to "your" music, and what will inevitably follow, "your" information. Then pose the question, say your copy of your favorite e-book gets banned, or suddenly Rihanna is illegal. Those things no longer exist if the cloud deems it. I for one want nothing to do with a model that could prevent me access to things that are "mine"
Codegoblin Thursday, November 17, 2011
Hah, your logic seems to assume that with the advent of access services, physical/local copies of the music will somehow go away. You still have the option to retain your personal copies of the music, spotify isn't smashing down your door and stealing your records. It honestly suggests a very simple and fair model. I would personally pay $50 a month to have access to all of the world's music at my fingertips 24 hours a day. Now, imagine that's the norm, that every music fan decided $50/mo was a fair price for nearly infinite music. Then you would have a HUGE amount of people paying $50 a month for access. You have a situation where most people probably weren't even paying $20 a month for music, and now everybody is paying a fixed price for an AWESOME product. The trick lies in the distribution of the revenue. What's more fair than if the largest amount of people in the world are listening to your music, that you get a larger slice? That's essentially how it works now, it's just a different means of delivery. And that's just the tip of the iceberg. There are lots more advantages for the industry as well. Just because physical sales are down doesn't mean that people aren't going to accept an access model. They will.
@jfedor Wednesday, November 16, 2011
Jeff Fedor
Getting some popcorn and beer for this one.
sales raided Wednesday, November 16, 2011
personal anecdote: about 2 or 3 years ago saw a significant drop in song sales. streaming services were massively gaining in popularity, and suspect that they were the reason. this was confirmed when my top sellings songs dropped, but for the same time period showed hundreds and hundreds of plays on spotify.
@missdubs Wednesday, November 16, 2011
rian rochford
So tired of hearing these Spotify is cannibalizing sales stories in Digital Music News.
@kimnw Wednesday, November 16, 2011
kimminy
"Spotify and similar access models are discouraging other forms of music purchasing"
I find that hard to believe.
@thornybleeder Wednesday, November 16, 2011
Brian Thompson
Spotify is detrimental to music purchasing... BUT it's also detrimental to piracy.
r.p Wednesday, November 16, 2011
At the end of the day, anyone can make up data for any argument. None of you will actually know the truth so use common sense as users.
Yes, as a user, I don't find the need to purchase music that I probably have already purchased before at some point. I use Spotify to play music that I like, which is mostly a lot of music from the past. As a consumer who never really buys albums in the first place, but, almost always has purchased singles in the past, Spotify has eliminated the need for me to feel like purchasing anything unless it is NOT available through them at all. That's me being transparent and utterly honest. However, it has completely annhilated all piracy on my end as well.
This isn't an opinion statement, this is just a profile into a real user. Until these services, and the labels find a happy median, this is how I will continue to listen to music. It is probably the most CONVENIENT way to do so and that's the golden ticket for me ― "Convenience"...
@bodidily_uk Wednesday, November 16, 2011
Bodidily
Why Spotify is bad.
blackswansongs Wednesday, November 16, 2011
It's true, you can come up with a study that says there is no climate change, or that Sarah Palin would make a great president...most studies like this are kind of meaningless unless their scientific methodology is sound.
What the study does not show is how a user like myself - like many people - consumes music:
Virtually any album in the world is available on the Internet right now via bit torrent. Of course, many indie artists may not have torrents, but many do.
I - like millions of people - download those torrents and the artists receives nothing...except exposure. I may or may not go to their show and buy merch.
Spotify - and other streaming services have made searching through and waiting for torrent downloads pointless. I used to download 500 torrent albums a year. Now I might download 3 or 4 a year.
Streaming services collect money that was being left on the table. What the study doesn't mention is that CDs sales - and iTunes downloads - would decline regardless of if Spotify were in business.
As bandwidth decreases in price - and gets faster - iTunes downloads and CD sales are going to decrease. Spotify doesn't have anything to do with that fact. The market will always find a way. If they have to, music fans will resort to "harddrive parties" and just copy 1 Terabite (sp?) worth of music back and forth. Who will those opposed to streaming services be able to blame then.
Another thing studies don't show is that there is a glut of music these days...infinite bands. Infinite choices for entertainment. And because of that, anyone could create a "study" that shows that the growing number of bands cannibalize the sales of other bands...
The genie is out of the bottle. You can't unring the bell...unless someone can invent a time machine and go back and get the labels to cut a deal to monetize Napster during its inception...
David_A Wednesday, November 16, 2011
Does everyone realize that Spotify pay over 55% of all the money they get to the labels directly regardless of how much is streamed?
That means, if 100,000 people pay $100/year to subscribe, then before anyone even streams anything, they pay the labels $6,000,000 dollars.
If anyone is to blame, it's the labels for not properly distributing that money to the artist, not the service itself. Instead, the labels make up all this BS accounting so they can keep the money and minimize their payments to the artists.
why doesn't anyone understand this? Digital Music News should really do an article on this atrocity, not grabbing sensational headlines like they have been doing. Yes, I'm talking to you Paul!
Honest Artist Wednesday, November 16, 2011
Streaming is better for the planet...
the "Record Business" was specializing in selling plastic for too long...it got to a point where it didnt really matter what these pieces of plastic contained, as long as it sold. It was very wasteful to manufacture, ship and distribute, and to some opinion detrimental to culture as "sonic junk food" was being served on $16.99 discs. Not that this junk food isnt still being served, but at a less detrimental cost to all.
This business of selling plastic was so lucrative that executive types and lawyers took over. Now it costs a million dollars to create a song for Rihanna and we are crying the the money is gone from the industry? Where was this money going anyway? artists were being screwed throughout.
Artists...keep creating, innovating, and pushing through. There are plenty of opportunity to make an honest living in this environment. If you want to be rich - go be a banker. If you want to be famous - go on reality TV. If you want to make music...just make music! if you are good...sorry not good, but GREAT, then people will gravitate to you, give you their money, feed you and let you sleep in their houses. It is time to re-adjust our expectations...the bubble has been burst.
Best of luck to all!
Looking Tuesday, November 22, 2011
I hate people like you. Intensely.
Yves Villeneuve Wednesday, November 16, 2011
Yves Villeneuve Wednesday, November 16, 2011
Buck Wednesday, November 16, 2011
The truth of the matter is that the long tail curve that the industry has been accustommed to is simply flattening out. Adjustments are going to have to be made. May need to start promoting legacy artists and back catalogs more.
On that note... what sucks for the labels is that we are nearing the "termination of transfer" date for 1979 copyrights. It'll be interesting to see how that is going to play out with respect to master recordings
Marty Wednesday, November 16, 2011
lol spotify just can't win here... People just aren't buying music like they used to so other forms of monetization is required. I've converted, binned most of my downloaded music library (except rare stuff) for a £10 per month subscription and I'm actually pleased I did. I'm regularly listening to allot of music I wouldn't buy let alone listen to, and it's re-ignited my love affair with weird and wonderful artists.. While their dividend maybe 0.0017p per play, the popular artists are clearly raking it from the per-play model, and fading artists are atleast getting modest royalties while noone is buying their albums. Unlike iTunes, Spotify and other providers aren't making ridiculous profits from extortionate pricing models which the consumer and artist get little benefit from..
I know people who over the years have spent serious money on a music collection they rarely even listen to.
In today's economy, why spend all your money on music albums or singles you'll either Rip anyway to your ipod, or keep on a shelf for a couple of years before selling it second hand on amazon or a car boot sale.
If content is more easily available and accessable in any way someone choses, everyone wins.
anonymous Wednesday, November 16, 2011
Thurston Saturday, November 19, 2011
urgency.
@derekwebb Wednesday, November 16, 2011
derek webb
if content makers can't survive, spotify has no content.
steveh Wednesday, November 16, 2011
Spot on comment...
Something that clearly Spotify has not properly thought through.
@parkeladd Wednesday, November 16, 2011
parkeladd
what about a correlation b/t Spotify users & concert attendance?
gaetano Wednesday, November 16, 2011
Concert attendance and/or touring is not a realistic sustainable revenue stream. Talk to any touring musician, or promoter for that matter, the numbers are as volitile as physical sales numbers in many cases.
Let's not forget the other industry gatekeepers that reign over that land, Ticketmaster, Stubhub, Live Nation, etc. Aside from the inherent physical demands that the road entails, the costs are no longer offset by things like album sales, tour support etc. The sale of a durable good was a key element to the entire music ecosystem (whether the artist was getting screwed on that end or not).
Peter Monday, November 21, 2011
Exactly this. Someone posted it earlier (airbornemusic.com) but I checked it out. A direct subscription based model to the artist is probably the solution.
OzRich Wednesday, November 16, 2011
I don't get it - the annual subscription paid by a user of Spotify etc is much greater than the average person spends on CD/downloads each year. It has to be better. And to make a comparison between a sale and single stream, and say they are equivalent is misguided and fundamentally wrong.
steveh Wednesday, November 16, 2011
Yes but the share the label/artist gets on a CD or download sale is much better than the share the label/artist gets from Spotify's subscription income. Most of your subscription goes to:- Spotify.
And on top of that it is fairly simple to track income share from CD and download sales wheras Spotify's income explanations are bysantine obfuscations that totally lack transparency. It's this shocking lack of transparency, coupled with the miserable income that is turning artists against Spotify.
radiowaves Thursday, November 17, 2011
True, but not every stream would have been a CD or download sale.
I listen to music on Rdio that I wouldn't have otherwise purchased. Often I'm just curious about a band.
I may stream a song 10 times in a week. That certainly wouldn't have been 10 downloads.
Sometimes I just want to hear an album at work that I already have at home on another format. I bought it once (or maybe twice, cassette & CD), don't want to buy it again!
Yves Villeneuve Wednesday, November 16, 2011
@onlinemusicmix Wednesday, November 16, 2011
Online Music Mixing
somewhat unsurprising?
logicbox Thursday, November 17, 2011
So they're substitute products then.
The Swan Thursday, November 17, 2011
Spotify bashing is very much en vogue now and for understandable reasons. I'm an indie artist myself. I know very well how poor the revenue is from Spotify. Spotify also suffers from an "un-cool" image because it's partly owned by the traditional music industry.
Quite many artists therefore recommend "cool" services like Soundcloud and Reverbnation. But hey, let's be fair. Soundcloud does not pay you anything (not even $0.00000017), nor does Reverbnation. In fact, they even charge you for uploading music if you want to put up a lot - while there are possibilities to get your music on Spotify for free.
So, in the end, what's the difference between the "cool" services and the "un-cool" like Spotify? Nothing, really. The owners are different, but in none of these cases the artists really earn something. The profits are for software developers and industry mogols.
The point is: streaming services such as Spotify should not be looked at as stores. They are online radio stations. For an artist they are ways to promote the music, not to sell their stuff. If they want to sell, they need iTunes or Bandcamp, and play live - and hope for a miracle.
If Spotify leads to lower sales, then it's a consequence of human nature and what technology has brought us. If something is free or almost free, people will grab it and no longer pay for it. You can't change that. It's a mentality, it's the attitude of people, and software developers such as Spotify (and let's not forget, Soundcloud, Reverbnation etc.) simply make money from this.
In the end, like it or not, it's the people that you might call your "fans" that are not willing to pay you.
gaetano Thursday, November 17, 2011
The major difference between Spotify and Soundcloud is that Soundcloud, by design, was never made with the intention on monetizing music at all, ever really.
Soundcloud never claimed to thwart piracy, nor did it tout itself as a potential alternative to failing sales revenue.
Spotify is not a store, or a radio station. It's a subsciption and Ad subsidized on demand music service, with a revenue stream that is geared towards major labels and volume.
You know what's cool?
A sustainable revenue stream for an artists, and no one seems to have thought about how that will work across the boards yet, not labels, not consumers, apparently not even the artists themselves.
To think that spotify will help anyone, or really cares in the end, that's hoping for a miracle.
@shoutsiniotaw Thursday, November 17, 2011
Steve W
Bit late to slam shut the stable door now.
Learn to work with it.
Stekke Thursday, November 17, 2011
what they think they are going to earn more million $$$$$. Some artists snuff too much, nothing anymore and then they would be better to attack records mafia, and even those rights organizations, they will see more money and create there own label. spotify also would give more than the artists. but they look too much through their rose-colored glasses, they must understand that economic model is bankrupt. There client are not stupid anymore or they find a solution by using spotify or they getting no dollars anymore byebye villa, castles, private attraction park.
upside? Thursday, November 17, 2011
All in all, there isn't much upside for the creative community.
Spotify gets an eventual IPO $$$
The ISP's are swimming in cash
The Artists are left holding the bag, T-Shirt salesmen dying of EXPOSURE touring at a loss in hopes of having their music streamed for no compensation?%#. My 4 months on Spotify have caused a 40% drop in my iTunes sales. I have since removed all my tracks from Spotify. I'm staying with Rhapsody.
Phil Childs Friday, November 18, 2011
It will be interesting to see if Coldplay put their latest album on Spotify after a period of time to ensure they cream sales revenue from fans who can't wait. This could be the model of the future - similar to only being able to see a film in theatres until it's released on DVD.
@overcastsound Friday, November 18, 2011
OVERCAST SOUND
Undecided on the whole thing myself, but more fuel for the fire.
Andy Saturday, November 19, 2011
It seems that everyone is assuming that the premium users are actually paying for Spotify.
Check this video out. It demonstrates how easy it is to get a premium account for free.
What if Spotify were just converting music pirates into software pirates?
Premium accounts? Saturday, November 19, 2011
It is fairly easy to set up a Spotify "premium" account for free. Free as in "no money paid, ever". I know how to do it and I am not a "h@cktivist".
Thurston Sunday, November 20, 2011
Niche vs. Mass Marketing. They are two different things with two different business models. I carry a double whammy because I'm an indie artist who plays jazz, which are both niches. There aren't many passive listeners of jazz OR indie artists, because they don't receive the massive airplay that delivers to passive listeners. Jazz/indie artists need ACTIVE listeners, the committed fans who consume way more music than the average person, and therefore have more discriminating tastes. Active listeners are the crate diggers, the ones looking for obscure and scarce music, that is subjectively good in quality. This is analogous to a person shopping at Whole Foods or a Farmer's Market, where they are willing to pay higher prices for higher quality products. Sure, it would be more cost effective for me to go to Walmart, but that would mean a sacrifice in quality. I can't say this applies to say Spotify vs. Bandcamp in the area of quality or genre, because music is a subjective thing. But I can say that active listeners are generally more focused on finding quality music OR music that majors won't touch for fear of not making money with these artists. Why? They care more about music and invest more in it, especially in less populated niche genres/styles. There might not be as many active as passive listeners out there, but they are very valuable customers to niche artists in terms of financial support. Many of these customers are more committed to supporting what they deem as "good" music, that many have access to illegal files and still choose to support the artist. However, if the culture of consuming music changes to streaming, and companies like Spotify indirectly lead people to believe that they are paying artists for the music, it makes it perfectly fine to consume all music on streaming services, and the artists walk away with pennies . . . . literally. "Oh, I'm not stealing it and I don't have to buy it from itunes!" Wonderful world right? I've heard artists who defend being on Spotify saying "well it just means I have to make music that people will want to listen to" as if that's what's going to put you in the ranks as an indie up there with Drake and Gaga. The reality is that these days, you likely need millions to sell millions, or to get a million plays. So the idea that if I just make "better" music, I'll get my million (which still only gives you 2-3K, now you're rolling in the dough!) is silly. If you give the active, buying listeners access to your music for free, they will listen for free. And no matter how you spell it out, for indie/niche/obscure artists, Spotify is basically giving your music away for free. That's why ST Holdings numbers are down right now, because they have NO business on streaming sites. I honestly think a better model IS invalidated illegal downloading, rather than validated streaming. Might sound weird. But I'd rather you steal from me than insult me by saying that my music is worth nothing.
Kevin North Sunday, November 20, 2011
This is a thought-provoking article. I've been doing a little research to decide whether Spotify is an ethical company. There's a detail in this article that bothers me, though. It says, "Spotify and similar access models are discouraging other forms of music purchasing - not encouraging them - according to a recently-released finding from NPD Group and NARM." However, other sources I've read say that the study doesn't specifically mention Spotify. They add that Spotify hadn't been around long enough to be included in the study when the results were published. Can I ask the editors of Digital Music News explain why they decided to mention Spotify in connection with the study or to list which music distribution companies or platforms were specifically mentioned in the study?
These are some websites that say Spotify isn't expressly mentioned in the study:
http://www.thewire.co.uk/articles/7994/
http://gigaom.com/2011/11/16/indie-labels-stage-another-spotify-walkout/
Again, this this article is very interesting. It's mentioned frequently in other places and has some challenging food for thought.
Paul Sunday, November 20, 2011
"However, other sources I've read say that the study doesn't specifically mention Spotify. They add that Spotify hadn't been around long enough to be included in the study when the results were published. Can I ask the editors of Digital Music News explain why they decided to mention Spotify in connection with the study or to list which music distribution companies or platforms were specifically mentioned in the study?"
Kevin, glad you raised this, it's a very fair question and one raised by NARM president Jim Donio above (NARM also contacted me separately to discuss at length). The central question was, why mention Spotify in the title and single them out? I think that's worth debating, and certain I accept the criticism here, but I made the choice because there is no other application or service that is more emblematic of, or central to, this debate than Spotify. It is the service with most financing ($200mm by some reports), the biggest PR machine, the most energy and the most focus within the industry and artists. To me, this study is actually all about Spotify, whether NARM and NPD concede that or not.
I may delve into this issue in a separate article, but for now I hope that explanation suffices. As the cliche goes, 'I stand by the story'.
/paul (report author)
SanfordH Sunday, November 20, 2011
So...in other words....you are making it all up? Faux News style twisting it to fit what you think the facts should be?
Way to go all Jenny McCathy there.
"Don't bother us with facts, Tell us what the "TRUTH" is!"
Kevin North Monday, November 21, 2011
So you're saying that you mentioned Spotify because, out of the major on-line music services, it best fits the type of service that the study described?
Thank you for responding to my question so quickly! I'm glad to see that you've already been thinking about this detail and aren't taking it lightly.
Paul Monday, November 21, 2011
Leading into this study, one of the biggest questions the industry was attempting to answer was this:
Is Spotify hurting or helping artist sales? Some argued that it was cannibalizing subsequent purchases and revenues, others were arguing that it boosted the ecosystem with greater awareness and subsequent purchases of downloads, CDs, and shows.
That is still a pressing debate, and we may need more time to see the results. But the NARM/NPD study suddenly breaks some ground, and investigates what effects this sort of model has on consumer purchasing. It is a debate with Spotify at the center, one that NARM/NPD is now a part of.
Of course, Spotify does not like this sort of critical examination for obvious reasons, and both Spotify and NARM pressured us immediately to either pull the story down or change the title. We of course refused, for the reasons stated above.
/paul
SanfordH Sunday, November 20, 2011
http://gizmodo.com/5861043/200-indie-record-labels-just-bailed-on-spotify
he statement from NARM fwiw:
Paul Resnikoff's citing of Spotify in this story is incorrect; no specific access services were named in the NARM/NPD report, and in fact Spotify had only just launched in the U.S. when this survey was conducted. There are many different types of music access models, and licensed services such as Spotify, which do pay royalties for the music on their services, are an increasingly important part of the mix of digital retail options for consumers.
steveh Sunday, November 20, 2011
Looks like Spotify send their goons round to have a word with NARM.
Fuck Spotify!
Visitor Sunday, November 20, 2011
"fwiw" NARM is working the pr overtime to discredit this story given the fallout. turns out Spotify is their client and very unhappy with the report and threatening pullout so this is just a typical spinjob to save a client.
declan Sunday, November 20, 2011
It seems like SPotify wants it both ways, they want the gushing press but freak out when anything is critical. Grow up guys. welcome to the big leagues, hope you guys last past the 3rd inning.
DanceMusicHub Monday, November 21, 2011
it's pretty hard to find the balance for launching a successful music start up and keeping the labels happy. Bottom line is there isn't that much money in it for all to be happy.
BXTR Monday, November 21, 2011
Round and round the industry goes, where it will stop, no body knows! Since services like Spotify rely on the awareness and reach of labels marketing, the question becomes can popularity convert to revenue with the album sales model slowly deteriorating.
Mo' money mo' problems.
JacksonL Monday, November 21, 2011
Anyone know what this Spotify announcement is?
http://allthingsd.com/20111121/spotify-says-its-headed-in-a-new-direction/
Bob Monday, November 21, 2011
This is a poll like survey, of what sample size we don't know, that contrasts with actual sales. As reported just a few says ago in Bloomberg, album sales increased for the first time since 2004 this year. Overall sales are up 3% and album sales up 5.2 %, and this with a still weak economy globally.
mdti Wednesday, November 23, 2011
How much a user makes out of youtube streams ? now that it is monetizable (may be some of you received emails last week).
Is it lower , higher than spotify/deezer and so on ?
You're all right... Thursday, November 24, 2011
America should all pay for their TV shows a la carte instead of subscribing to cable, watching Hulu, or using Netflix. That goes for Redbox, what's left of Blockbuster, or any other content rental service. Shame on you for renting a movie and watching it more than once, too. Even worse if you let others watch with you, without compensating the content owners.
Forget about ever selling your used media to anyone. That would make it a long-term subscription, and depending on the amount you paid and the years of what used to be ownership, you could have essentially rented/subscribed to that CD/DVD/etc. for pennies per month.
America should still pay for cellular airtime and data by the minute and megabyte, no more unlimited, flat rate plans.
America should pay a la carte for each blog, article, or story that they read on the internet, instead of accessing it for free with pesky ads.
America should shut down the libraries too, since tax dollars basically offer up a free subscription to all you can eat reading. Buy ALL of your books a la carte.
It is a good thing the only consumers who read the comments here are the ones stuck in the music industry's vacuum. Grow up, stop being so one dimensional. Get out of the business that you ruined with your shortsightedness. Pass that tip on to your buddies in the movie industry too, before it's too late.
You can buy water in bottles and jugs, but you also subscribe to receive a steady stream of water to your home. Scale. EVERYONE subscribes because its cheap, easy and convenient. I'm sure your city utilities/water department is making more than enough to pay all of their stakeholders.
Stop complainging about necessary change that you are the primary cause of. Innovate, or you might as well just shut off your water and buy it a la carte.
Looking Sunday, November 27, 2011
Here we have a situation where people spend years learning to make music, investing significant amounts of money to do so, and foregoing many other things in life to do so. And all a parasite like you can think, is that you are somehow entitled to the fruits of their labor for a little as you can pay. If the people whose work you consume, like a locust, can't make a living from it, and can't even come close to earning back the money they invested, let alone recompense them for the the time, effort, and opportunity costs, then that's just too bad for them, yes? And the closer that the pittance that you sometimes condescend to pay approaches "zero" the more you enjoy the music, or the film, or the ebook, or the comic, or the photography, or everything else.
Would that be pretty much how things are?
Of course it is.
Well who really expects parasites to show empathy, actually?
Hugh T Friday, November 25, 2011
It's called "value". Spotify and other streaming
services are simply perceived as a better value proposition by the consumers
that have tried them and have also made a conscientious decision not to steal
from creators. These services will dominate once the majority of like-minded music
consumers recognize the value presented.
Piracy is a separate issue.
But I would argue a large portion of piracy is based on ease and “free”. Once the casual “pirate” realizes streaming
is as easy as stealing, the cost of being legal is low, and the artists need
support to produce, a shift will take place.
I believe it is already happening.
So what remains to be answered is "how" the value will
be divided among creators, distributors, and consumers. Obviously
"free" is the best from the consumer perspective but that is not
sustainable. In time, a sustainable system will result with artists
receiving sufficient compensation. This is because there is a demand for
music in the market. If a sustainable
system doesn’t arise, we all be listening to "catalogs" the rest of
our lives.
Technotopia Tuesday, November 29, 2011
"Lower your revenue expectations" is the new "Roll over and try to enjoy it"
@tron2000xl Tuesday, November 29, 2011
mike shandrow
Starting to have a love hate relationship with Spotify.
MattG Tuesday, November 29, 2011
like most article/forum responses we can argue logic all day over whether this service is helping or hurting the industry. I am a recording artist whom owns his own label/publishing (mattgmuzik.com). Not enough time has passed nor figures been accumulated to even attempt to argue these points.
Spotify and services like it are great for artists like myself to increase exposure and opportunity to be heard in a day where Fm still rules though we are seeing a shift in climate. Its not their fault the numbers in sales have declined, as always its the major labels fault any of this is an issue. Their greed and inability to shift business models has caused pains for every aspect of the industry.
Profit isn't made by artists through music sales, its through touring, publishing, royalties, and merchandising. Even Major label artists rarely generate their wealth through music sales. Too many havenots and not enough haves have turned this into a war amongst the participants. The main object should be to eliminate piracy completely and if services like spotify, grooveshark, last.fm, etc. are the key than so be it. Btw I am a proud premium user of spotify who also has an album available on the spotify network.
mojobone Wednesday, November 30, 2011
I'm hearing that this study is based on data collected prior to Spotify's US launch. On-demand access may indeed decrease the perceived need for ownership of music files, but it may also increase awareness of independent music. Regardless, there's a large difference between feels-like-free subscription, and ownership; subscription services can take away your music if you stop paying the bill.
Matt Miller Wednesday, November 30, 2011
I wholly disagree. I visited Wikipedia to find out about Down Tempo Bands. I visited Spotify to listen to the catalogue of two albums by one band. I then visited Amazon and bought these CDs used. There is a simple logic chain for you- Spotify is a research endeavor helping us find good bands. An investment decision is made on the purchase and tastes the world over increase! How you like that Digital Music News!!!!
Visitor Thursday, December 08, 2011
so you bought the CDs used? way to support the bands!
Visitor Thursday, December 08, 2011
i'll just leave this here
Visitor Monday, December 12, 2011
hey, it's all good. after all, spotify by default, pulls the music from your itunes folder. it's a win/win for the user.
still not a good business model for an obscure indie trying to get paid as well.
exposure yes, but no dough.
the majors are doing what they have to do as majors.
i'll do what I have to do as an indie.
Spoken X Digital Media Group Saturday, December 24, 2011
Youtube is a slightly bit different kind of access music entity and it supposed to be supported by an in video advertising model. And they've also worked out a licensing scheme with Harry fox for a direct permission with the publisher of that particular video independent or major. Youtube share the video model can really help an artist in terms of ' Hey Here I Am! ' provided the artist has some downloadable music direction for the fan enjoying the visuals. . .: And that within itself often rest on the shoulders of the ' Invisible Man '--the digital music publisher themselves who has to always be ready and willing to think outside the outside box, able to transform and transcend digital formats at the speed of light with the confidence that you don't own our assets we own the price of your digital entertainment lifestyle. . .
sasebastian Tuesday, December 27, 2011
I wouldn't trust the study from NARM. The lifeblood of NARM retailers has always been top 40 and catalogue acts and it's been proven year after year that those sales are down. The catalogues have been repackaged a million times -- how many "Best Of Aerosmith" and Steve Miller Band box sets does anyone need to buy? Top 40 aren't selling millions anymore -- people don't care about Britney, Xtina, Maria and Ke$ha. These record stores are selling whats on the radio, not what's on Spotify. Thier problem has absolutely nothing to do with Spotify. As an independent, you shouldn't care that NARM sales are down. They don't carry your album. Fuck them.
What I don't get is how Spotify isn't "worth it." Royalties from radio are shit to non-existant for indies. If you're an indie band you probably have a handful of spins on college radio or on boutique shows here and there, no royalties, no sales, miniscule exposure, no visits to your website, no merch sales, no bump in gig attendance. Radio gives you nothing.
You're on Spotify (or Pandora, Last.fm -- same difference), you have hundreds to thousands of "spins" (weekly) to a targeted audience that is engaged and actively seeking out new music. You have click-throughs to your website, increased attendance at shows, merch sales, CD/MP3 sales, AND royalties which you are NOT getting from radio.
Sure, the royalties are small, but they are royalties. You are not getting royalties from radio. And if you are I guarantee they are WAY less than what you would get from Spotify and the rest. but no one is questioning whether or not radio is "worth it."
OUR SPONSORS
© 2011 All Rights Reserved
Follow Us