Artists believe that Spotify completely destroys album sales.
Artists will generally make more money from selling an album, physically or digitally, than they will from streaming their music.
Artists’ songs have to rack up about million streams on the service to actually make them proper money.
A per-stream play in Spotify pays between $0.00121 and $0.00653, depending on whether the song is streamed in the ad-supported version or premium. So, to actually earn a decent amount of money from Spotify, an artist’s song has to rack up a serious number of streams, which is usually only possible for major artists.
Like Ed Sheeran, for example, whose song Thinking Out Loud got 500 million streams on the platform.
Artists believe that Spotify devalues music.
Music fans are able to listen to the entire catalogue of their favorite artists for free in Spotify’s ad-supported version, which gives little incentive for them to pay. This is the main issue that many artists currently have with Spotify: they simply don’t like giving their music away for free. Taylor Swift famously pulled her music from Spotify, along with Adele and several others, based on the feeling that their art is valuable and that free streaming devalues that art.
Spotify is paying out 70% of their revenue back to the music industry, but artists are typically not seeing this value.
The streaming service has repeatedly stated that they are pouring 70% of their revenue back into the music industry, which I don’t doubt is true. But, artists are claiming that they are not seeing this, which frequently is caused by major labels taking a large chunk of the revenue and giving the artists a tiny share (if anything at all). Regardless of whether it’s justified or not, a lot of that hatred gets misdirected to Spotify.
There are other streaming services with greater benefits.
There’s a reason why artists complain about streaming services, but don’t say anything about YouTube. The reason is simple: artists need YouTube. The service has over one billion active users and acts as a platform for worldwide exposure. Not only that, but YouTube allows artists to easily share their videos with their fans.
Another factor is video. Simply, audio coupled with video has a greater impact on fans than just simply the audio. Combining a great song with great visuals can really magnify a song’s success, and artists know this all too well. Last year Spotify, announced the addition of videos and podcasts to their service, but still, though YouTube remains the secure default for video. And given huge YouTube numbers and overlapping fanbases, the question arises: if artists distribute their music through YouTube, do they need Spotify?
I am a big fan of the platform and truly believe that their service strategy if not a solution, is a step in finding a solution to issues of piracy. It is a meeting point between the users and the copyright owners.
The competition within the industry may be fierce but sometimes artists fail to see the market that exists with smaller prices.
For music fans, the competition is between value and convenience. Lower the prices and you may sell 3 million copies of a record you are now selling about 500.000.
Where have you been? CDs that used to sell for 30$ now sell for 5$. Guess what? 0 increase in sales. Sorry, but your argument simply does not hold up.
“It is a meeting point between the users and the copyright owners.”
More accurate:
“It is a meeting point between the thieves and the copyright owners.”
There is a point here: streaming services like Spotify have had an impact on piracy, reducing it in many cases. That doesn’t mean the overall levels of piracy have decreased, though at least a large number of music fans have been brought into a known, ‘green zone’ where they can theoretically be ‘monetized’.
Streaming services had an impact on piracy because they basically are pirating, relieving individual piraters of the legal responsibility.
Paul, can you clarify this statement? Are you saying that piracy for songs available on Spotify’s freemium service is down but overall music piracy levels have continued to grow at a historically consistent rate???
I guess I am asking b/c I have seen different stats that point to both of these possibilities on DMN over the past couple of years. But, its been unclear if each of these statistics has been equally trustworthy.
I believe it’s more that the younger generation don’t ‘value’ music as much as older generations. They don’t blink an eye when spending 10 GBP on 2 lattes & muffins in their local coffee shop, but the buying of an album at the same price is alien to them. Its not their fault, its just that they have grown up in a technology advanced era where music is so accessible for free, and perhaps they haven’t been educated enough in what the costs
are creating, recording, promoting & marketing an album.
I agree with Paul that legitimate services such as Spotify has decreased piracy, and they are a fantastic, convenient service to access & discover new music. I’m 42, live in Denmark, was a vinyl, then CD buyer, but the past 6 years have been a premium Spotify subscriber. Being able to Save new release albums on Friday mornings then listen at my convenience is great for me, and I will buy the vinyl if it is a ‘good’ album.
I have never before in my life been able to discover and listen to so much new music than I can today, not just major artists, but from all genres an indie labels. I’m comfortable knowing that at least x gets paid back to labels (hopefully artists) from me streaming it.
Yes, I know it takes many little x to hit the XXX of the margin return on a CD/Vinyl, but its ongoing right, not just a 1 time purchase. Multiply that by those millions of users around the world, then surely the revenue will be there at some point for the artist.
At the end of the day there has never been an easier way to discover new music, and if you truly make a great album, it will be heard, shared, promoted and streamed multiple times.
Sorry Charlotte – 70% of Nothing is Still Nothing… You Miss the Point.
Spotify is equal to Itunes dropping it’s prices of albums to ten cents and songs to a penny, all while still paying 70%… Is that sustainable? No.
Please think this sh*t through before you start writing Spotify PR talking points. Thank you.
Or you’ll sell the exact same amount and make less money. It all depends upon your fan base. For most small to mid level artists, the price point has nothing to do with the sale.
“which is mainly down to the major labels taking a large chunk of the revenue and giving the artists a tiny share”
This is only true if the label is also the distributor. The major problem with payment comes at the distributor/aggregator level. The amounts being reported to labels are strange and downright suspicious. An indie label, for example, has no way of verifying the numbers and has no other choice but to accept the numbers reported, no matter how suspicious these are.
I disagree with the notion that Spotify destroys albums sales. Album sales were already destroyed by the internet long before streaming came along. I believe there was a period of time between the invention of the phonograph and the invention of the internet where a unique combination of advances in technology and limitation in technology allowed one to sell albums and make decent money. That time has now passed.
That said, I do feel the streaming services are giving away the farm right now. I think all new releases should be windowed for 3-6 months as iTunes/Amazon downloads for $0.99 per track before they hit paid streaming services, and 6 months-1 year before they hit free services (with the exception of YouTube, which should make one or two videos available to promote the album). There will be some piracy, but there will also be enough people on iTunes and Amazon buying permanent downloads of tracks from the album (if not the whole album itself) to make it worthwhile. I think the labels will make more money that way than if they release on streaming services day and date with the album release.
This should be a prospective thing. Anything on Spotify now, stays on Spotify (assuming it’s licensed, of course, but that’s another topic).
Free, ad-supported services should have rotating, limited content too. Users should have to pay subscription fees to keep their playlists intact.
Spotify and streaming are important to the industry. If they die, the music industry dies with it. But we can be smarter in how we use them.
Are artists forced to have their music streamed on Spotify? Or do they have a choice?
It varies by artist. If you’re signed to a major label or one of the larger indies, probably not (with perhaps a few exceptions for the bigger artists). If you’re going through CD Baby, Tunecore, etc., you probably have a choice, but good luck selling anything without a major label’s promotional efforts.
‘There are other streaming services with greater benefits.’
There certainly are, but YouTube is not the most obvious one to come to mind. Another one begins with A.
The problem is the millennials have been spoiled. Food should be free before music.
I think the real issue with freemium is the lack of choice. And that lack of choice points to my largest issue with spotify; arrogance.
If Spotify would allow artists to choose if/when their songs will be available to freemium users, freemium would no longer be a source of pain for musicians. I feel that Spotify’s repeated refusal to offer such flexibility, or restricting it to only the largest major label artists, clearly demonstrates just how little respect the executive team has for musicians and songwriters generally. The overarching implication seems to be that Spotify thinks we’re all too dumb to know what’s actually good for us.
The indie labels aren’t paying artists for Spotify plays either. Sadly, that scandal is under-reported.
Most of us are, but there’s very little to pay since we don’t participate in the revenue the way the majors do. We only get .0025 per stream on average. Most of our Artists see $15.00 to $30.00 per semi-annual statement. When a song gets on a super popular playlist, they can see $3000-$6000 for a short period of time. But, that’s very infrequent, and far less than the revenue from physical or permanent digital sales. Streaming is great for the consumer, very little or no cost for all you can eat. Bad for artists, who need real money in order to survive and make new music.
Exactly. My label also pays its artists. One of the problems is the strange and unbelievably under-reported numbers the label is given (and paid for). Again, the problem lies with the distributors and aggregators.
Spotify. What a nightmare. Part of their expressed marketing has been based on eliminating the sale of physical product, Ek has expressed this, often over the years.
Their deal with Starbucks is a perfect example. They eliminated one of the few high-profile point of purchase destinations for CD. Ironically? the last major release in Starbucks was Taylor Swift.
If Ek, Parker, et al had any understanding of the artist side economy, they wouldn’t have been so anxious and determined to kill CD sales.
If that wasn’t enough, their insistence and defense of “Freemium” was another killer. And why? They didn’t have a service people wanted to pay for. They have a business based on a future financial projection that only works as an IPO.
Where is the article showing the reasons why artists love Spotify?
Because, artists don’t love Spotify………
That’s a general, and untrue, statement. This (link below), along with statements in the press from artists like Bono, Prince, Neil Young (the last two being recent converts) indicate that not all artists hate the service, or streaming, in general.
http://www.wired.com/2014/11/one-band-who-loves-spotify/
The title says ‘Reasons Why Some Artists Absolutely Hate Spotify…not ALL. That would be an untrue statement.
Rick tell us more about Bono’s relationship
With Spotify. You seem to follow their inner-workings closely.
It appears Bono may be closely involved with Spotify’s next lender group.
The common factor is that those artists are already well established, supported by a plethora of fans, and essentially – if not actually – millionaires, basically having fun experimenting with a music new outlet; thus not reliant or dependent on streaming for substantial income for, say, alone the cost of living, as indie artists are on behalf of the artistic and business (and any science/engineering) efforts of creative works.
Yeah, its been more than 1 WHOLE MONTH since Spotify sponsored an article like that on DMN!!!
http://www.digitalmusicnews.com/2016/02/04/how-spotify-is-helping-beat-music-piracy/
Umm… Youtube has 1 million active users? That’s great! Spotify has 30 million PAYING subscribers, and Spotify pays more money per streaming. Really… what the fuck are you talking about??
We’re talking about the 1.25$ a year we make out of the thousands of streams of our songs on Spotify.
The past THREE YEARS I made less then $10 on Youtube with 21 videos, 500 subscribers. And a LOT OF time and money spent on promotion!
But at the same time I made $100 on Spotify with only 8 songs and 200 followers and ZERO promotion.
So again…. this article is SO stupid.
The article is not MY opinion. It is the opinion of the artists that dislike Spotify, hence the title. I’m not validating their comments, just reporting them.
Wow! You’re going to make, what? 3 albums with that kind of dough? Tell us your secret….
Read that Bette Midler was payed 140 dollars for 4,2 million streams. Not a lot of money and she’s a well known artist.
I never stream my music, that thing hardly qualifies as LISTEN TO MUSIC for me, no effort, no passion, no nothing. Sorry.
Great post! Did you know that they even ad songs to the wrong artist profiles sometimes?
This YouTuber made a video about it:
https://youtu.be/rkCjkcCielU