Grizzly Bear: Spotify Doesn’t Help Bands. Or Labels. Or Indie Stores…

They’re not hating, just telling the truth as they see it. Because when it comes to broader benefits, Grizzly Bear is seeing very little gain from Spotify, MOG, or any other streaming service.  In fact, streaming is pretty much the same thing as Limewire in their minds.

Here’s a Twitter discussion on the matter that started a few days ago.

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Spotify says they’re saving the world from piracy.  Grizzly Bear says there’s little difference.

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And, the numbers…

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37 Responses

  1. HansH

    They have a point here, but please use the right numbers: 10,000 plays are good for $50.
    Looking at YouTube counts. The Two Weeks video alone has 6,4M views. Worth $32,000 on Spotify. What has YouTube paid for the views? Anyone?

    • Anonymous coward

      I came here to say this. On a recent Tunecore statement, 266 plays translated to $1.77, which is $0.006654 per stream. At that rate 10,000 streams is $66.54.
      Assuming an average rate of $0.001 per view on YouTube (normal for a bigger partner) that equates to $10.
      Not saying Spotify is the answer to life, the universe, and everything, but I am saying their payouts are better than most artists think.

    • Robbie Fields

      Well, Hans, since we started this back and forth, Spotify is still mired in the low 2 figure muck whereas YouTube is now solidly in 3 figures monthly for me and continuing to grow revenues.

      • HansH

        Hi Robbie,
        Good to hear that YouTube is doing fine for you.
        YouTube is the biggest streaming service by far, available world wide and 100% free. I guess that explains a lot.
        How many active users does YouTube have? A billiion maybe? Spotify’s userbase is way smaller, so in this stage Spotify just cannot compete with YouTube.
        According to this info between YouTube pays between $0.002 and $0.006 per view:

        • Robbie Fields S

          I never quite get where you are coming from, sometimes the Spotify sceptic but usually its defender.
          I am not doing “fine” from YouTube. I am receiving somewhere between 1% and 10% of what (I think) they should be paying but at least they have begun to pay something significant in terms of my budget.
          Spotify have not. Plain and simple.

          Spotify have the touted advantage of paid subscribers, YouTube does not, so Spotify should have an edge in creating income streams. They are both in the advertising game.
          The 2 companies are very much comparable for my repertoire. Coverage outside the USA and Europe adds little. But thank you to the Aussies, anyway.
          You can even posit that the only game worth bothering about is the USA for certain repertoires. This is where Spotify has definitely not picked up the slack in producing replacement revenues.
          I will say that my recent gambit in lowering the cost of album downloads to as low as 1.99€ and no more than $3.99 on iTunes, worldwide is paying off.
          Even though I am fixated on my paid download data from iTunes, I am not receiving easy access to the per stream data, other than iTunes Match.

          So I can’t help you in that kind of data comparison which I find largely irrelevant as the total sums are so small.

          • HansH

            Robbie, I am pro streaming and Spotify is the best service (from the consumers point of view) IMHO, but that doesn’t mean I need to defend Spotify in every aspect.

          • Robbie Fields

            One of the strange comparisons that forms part of your mantra is comparing 70% of iTunes revenue paid out as royalties and a comparable percentage paid out by Spotify. The coup de grace of your argument is to put down inadequate earnings on Spotify to lack of popularity.

            I take issue with both parts of your argument.
            ITunes is run as a cash business. Downloads are sold, paid for by the consumer and accounted to rightsholders within an average of fewer than 30 days.
            Spotify is not run that way and you know it.
            Spotify paid advances to the favoured few. How are they accounted for? How are the stock grants accounted for?
            I have a strong suspicion that even if Spotify is “paying out” 70% of current revenues during any fiscal quarter that is not cash leaving the building.
            Those who derive actual income from paid downloads have any reason to question the Spotify payouts and do not need to be belittled by accusations of lack of popularity.

          • Casey

            Although it would be nice to know what others get from Spotify, truly it is none of your business. These are private contracts. Like most industries, private contracts are exactly that. Private. Companies strike different deals with different people all the time. Equality does not exist, not should it. Do you think companies can go to HTC and ask what price they are building phones for their competitors? No. This is how the world works. The music industry has absolutely no reason to be any different. If you don’t like it, don’t use these services. Just stop complaining.

          • HansH

            Thanks Casey. Couldn’t have said it better.
            Robbie. You just don’t trust Spotify, I do. Time will tell who is right or wrong.

          • Robbie Fields

            Congratulations. You and Casey have managed to marginalize the majority view in an industry forum.
            Majority? Not of the fan boys or sock puppets, but of actual copyright owners of sound recordings.
            I have had a recent response from a dear friend in Sweden who is a big name performer, composer, producer and small label owner:

            “Yes Spotify is a big rip-off!
            It’s been OK for (redacted group name) since it generates live shows but as a producer/record label I get close to nothing”.

            You make it a point to focus on per stream payouts and percentage of revenues paid out. I do not.

            I tend to think about Spotify only when these online discussions take place. Then I dig around current data to see if anything has changed!
            How on earth does “trust” enter into this discussion? Rly?
            It’s about PERFORMANCE(S!)

          • HansH

            Can you tell me the name of your friend in Sweden and/or ask him to publish his Spotify royalty statements? He can publish it as a guest post on my blog if he wants to.

  2. igorwas

    Compare this to radio. You measure radio by number of spins times number of listeners. How much are you getting from radio for those spins. Radio is a passive activity and you will be heard at random and may find new fans. Would you ask radio to stop playing your music because your ASCAP or BMI checks are too small. Perhaps you aren’t getting anything for your airplay because you are not the songwriter or publisher. How about Soundexchange. How much are you getting from them? How much did you have to pay your radio promoter to get you on the air?
    I’m both a member of this music industry and a consumer of music. As a former owner of a independent record store chain, I’m in the same line looking for work as the typewriter repairman. I also owned a record distribution company both the distribution and record stores sold millions of records at very small profit margins. Now I’m a thing of the past. Now as a personal manager, it is important that I find ways for my clients to make a living. Otherwise I don’t earn anything either. I love streaming services as a consumer. Now we just need to find a way to make sure we get a fair share. We can’t go back. The movie industry has the same challenges. No one wants to quit Netflix.

    • HansH

      You are absolutely right. One thing though. You do get a fair share: 70% of the revenues are paid out as royalties.
      I know that in many cases this still leads to pennies on your statements, but that has to do with the popularity of the music and the still limited number of Spotify users.
      This sort of explains it:
      Spotify’s D.A. Wallach Explains How Spotify Pays Artists

      • The Rusty Hook

        Such a farce. DA Wallach is probably getting paid to shill for Spotify.
        Digital Music News go investigate that.

      • FarePlay

        Hans, I don’t doubt that there are musicians who are legitimate fans of Spotify in the same way that they’re musicians who believe in giving their work away is the way to go and seling t-shirts is the path to stardom or at least solvency.
        The question is, why are these services developing a business model that might work if they can get content at fire sale rates and worse yet getting those deals.
        Where are the artists in all this? Where is their outrage? The power is in pulling your catalogue from these services.

    • ben

      the point is, radio and bigger outlets, letterman, SNL look at YOUTUBE counts, not spotify counts. Radio sells CDS. Spotify doesn’t not. Nor does it help dying record stores.

    • Cliff Baldwin

      You don’t ask radio to stop playing your music and paying ASCAP & BMI because radio is proven to be great for sales. It still is, terrestrial, internet, or overhead in f’n Starbucks. On-demand however, as well as all DMCA-non-compliant, all-day streaming is not so great for sales. It should be up to the artist. Give your music away if you want to. Stream it all over the planet. Or sell downloads, vinyl whatever. It’s your product, your work, your hours of mixing and mastering. Take good care of it in the way you see fit.

  3. Anon

    Spotify pays 0.007 per stream. That on the subscription platform. The ‘Ad Supported’ stream in about 1/10 of that.
    It is a pathetically small amount + cannot support the industry in it’s current state. It won’t be long before labels pull out on mass.
    Unless, of course their subscription grows by, at least 10x in the next 2 years (without canabalising iTunes…)

  4. Visitor

    So happy to hear more bands spreading their personal view on a topic that means totally different things to totally different people.
    There are fans of Grizzly Bear that are also fans of are bands/artists out there that love Spotify. When you make a sweeping statement like this it speaks volumes to your fans.
    This is a subjective issue, best to make sure you express that as well…..

  5. @JulienPhilippe_

    Comme d’habitude le meilleur est dans les comments.

  6. @gkla (Greg Katz, Esq.)

    100s of tweets spreading music I love. 1 trashing a band for something small and it’s the one that sticks. natch

  7. @alex_munro

    Big reason why YouTube is better than Spotify for artists:
    “at least with radio and venues they look at YouTube counts”

  8. Who?

    How much does college radio pay Grizzly Bear for spins?
    Yes, that’s right. Nothing.

    • Old School

      College radio pays Grizzly Bear via the Performance Rights Organization fees they pay – ASCAP, BMI, SESAC, etc. They can’t operate without paying fees to these organizations. Don’t talk about things you know nothing about.

      • Robbie Fields

        Historically, BMI did not pay for college radio performances, much to my chagrin, as I spent a fortune promoting to them and subsequently being inundated with their snail mail playlists!

        But for some years, BMI has nurtured that market and BMI compositions are now earning.
        The rate appears to be $12.24 per surveyed performance (50% for writer, 50% for publisher). In a recent quarter, 3QTR2011,
        I had 4 performances surveyed, so that’s $48.96.

        Here’s the sting :
        For the the corresponding 3 months on Spotify I received just over $50 in master royalties with no significant publishing royalties accrued. OK, the fan boys will say that Spotify was just getting going. But Spotify payments have fallen since that time!

    • martin c

      College radio doesn’t pay, but then you can’t chose what you listen to on College radio. In the days when people actually paid for music you could see the difference plays on College radio made to sales (certainly if, like us, you’re the kind of band that never gets plays on mainstream radio).
      We were better off when there was unbridalled piracy. I know plenty of people who would download all their music for free, but when they discovered a band they liked would make the effort to find and buy their music. Those same people now listen to it on Spotify and feel that they have already paid for it, so don’t buy.
      Fighting the pirates has only helped the majors.

  9. Martin Rigby

    Panning Spotify may or may not be fair – it certainly doesn’t go out of its way to provide indie labels with additional benefits beyond plays with a very low pay-out rate (taking into account both fremium and subscription users).
    At Psonar we’ve tried to do more – with the Viral Promote music marketing platform which lets labels and artists sell through to merchandising and other products. And with Pay Per Play, our core consumer service, we’re able to offer a significantly higher pay-out rate per track: c0.4c per play at the label level after paying performance royalties (i.e. the equivalent of the 0.1c per track that @grizzlybear cites).
    My point? Don’t give up on streaming music yet. It’s where consumers are going, we just need to keep iterating the models until the needs of consumers and artists/labels are sustainably balanced.

  10. GR3G

    iTunes Match pays 0,00331perstream, Spotify 0,00967 dollars. Spotify 3 times more…

  11. REMatwork

    A few years ago, when these streaming services got rolling, we assumed “inhibiting piracy” was the same thing as “monetizing”.
    Now it seems that you can reduce piracy without monetizing squat. The net result is the same for the artist, and the artist’s team: no new income.

  12. Big Swifty

    This story and comments (especially the comments) keep getting rehashed again and again here.
    The reality here is that streaming music is the future for the major labels, the major labels are making and will continue to make the majority of money from streaming, the majors will redistribute revenue to their favorite poodles, some get cream while others get crumbs.
    Streaming was never meant to be included in the internet utopian dream of the DIY crowd and small labels.
    Streaming is not a marketing tool, it is not a way to be discovered and it is certainly not a way to make money for individuals who are not part of the major label music machine.
    So unless you are signed to a major label who is spending hundreds of thousands of dollars marketing your product, you must expect to get next to nothing from streaming now and forever.

  13. No, nope, not quite

    None of these outlets pay per stream except YouTube. The actual streaming music services (Spotify, MOG, Rdio) use a completely different model that has to do with revenue shares not per stream payments. Dividing the amount paid by streams to arrive at a per stream amount is misleading and downright false. Major labels get paid more than independents because they have higher negotiated rates and they have bigger shares of total plays. YouTube only pays copyright holders who deliver the unique sound recording to have it fingerprinted by YouTube’s content ID system which is not very accurate.
    Just thought I’d add some TRUTH to all this hyperbole and guesswork.

    • steveh

      I don’t think you’re quite right there – you must have drunk some Ek model kool-aid.
      We have accounts with Orchard and IODA (the two biggest indie label digital aggregators – in the process of combining).
      Both Orchard and IODA give copious detailed accounting of Spotify streams with clearly detailed PER STREAM AMOUNTS.
      You said:- “Just thought I’d add some TRUTH to all this hyperbole and guesswork.”
      How can you “add some truth” when what you said is patently NOT TRUE?
      In the immortal words of Jack Nicolson:- “You can’t handle the truth!”

  14. Deeann D. Mathews

    YouTube would pay for the views, but a band would have to get signed up with a performance rights agency first (ASCAP, BMI, and SESAC) come to mind. YouTube would pay the PRO, and the PRO would pay the songwriter — and, given that a one-minute piece of music once paid me $39 through ASCAP, I’d say getting signed up would be worth it!

  15. Guy with opinion

    Let me call the waaaaahmbulance for you.
    What does spotify (and similar services) tell you? That fans want music that is convenient and inexpensive is what.
    If you can provide convenience and low cost along with a great discography, you get many customers. Customers that may not get you money via spotify, but with social networks and word of mouth you will get some extra exposure. I find a lot of new bands from friends spotify feeds.
    Now if YOU grizzled cry bears and anyone else who feels shafted could provide your music to your fans in a convenient and low cost way (and for the record $1 is way too much per song) then you can pay yourselves. Oh that and the bandwidth costs that are going to be killer!
    But if you do this yourself, or even if the lable did this it would be disconnected from all the other music out there.
    Actually if most major labels did this for their artists, I bet artists would get even less most of the time.
    What you and your douchey looking band need to do is realize that your moneyt making potential stops at the label end of the spectrum. You make money doing shows and appearances. Even some of the more established bands get very little from their sales in relation to what they make from shows.
    Now since you guys are all fired up to do a “Metallica vs Napster” crying session, I hope you also are ready to take the hit. Although I never heard of you so maybe so one really cares that much anyway. Maybe your egos have taken you down a road to a hard slap in the face.
    I also see that according to your website, your only digital distro is via iTunes. Maybe you need someone who knows about the 21st century and outlets like Google Play and Amazon MP3 are out there as well.
    So in closing, stop yer bitching and put out an album like Radiohead did. Make money from the fans directly by giving them a way to get your music EASILY and INEXPENSIVELY and DRM free. Fuck a label.