Spotify pays around 70% of its revenue to their artists. This means if they just fired everyone and only paid for bandwidth it would barely move the needle.
Artists need to remember the alternative isn't 2-4x higher payouts - it's piracy.
It’s more complicated than that. The music industry has famously abused artists almost since the beginning so there’s also room for artists to dramatically increase their income by cutting into the share that the middlemen have been taking. This was true even before most people had computers or went online:
https://thebaffler.com/salvos/the-problem-with-music
One big change, however, is that the alternatives have dried up. A musician used to be able to make more of their income from live performances and merch sales but since the early 90s Ticketmaster/live nation has dramatically removed competition from that market and jacked up their share of what fans pay. These aren’t “hit pieces” (let Spotify PR earn their paychecks, don’t do it for free) but rather the latest in a long story of creators seeing increasingly low returns for their work, and now everyone is wondering how likely they are to get sandbagged by AI splurge being used to drive down their income even further.
1. I'm not sure if Spotify still does this, but I think it does, but a couple years ago there was a big kerfuffle over how Spotify allocates its revenue. The way it works now is that only huge artists make anything, because given the power law distribution of music, what Spotify does is take the number of streams for an particular song and divides them by the total number of streams, and then uses this to proportion total revenue accordingly. What smaller artists wanted was division of revenue by individual subscriber. That is, say I pay $10/Mo for Spotify, but I only listened to 10 songs that month, all from the same artist. Under a "divide individual subscriptions" model, that artist would have received the full amount (i.e. approximately $7) of that user's subscription revenue (obviously depending on who has the rights to the song). But the way Spotify does it (again, not sure if this has changed), since that user listens to much less that the average user, when you pool everything together, that obscure artist makes a lot less.
2. The other issue is that Spotify has been using their power to force artists to accept their music being played for free in the first place. Taylor Swift famously removed all her music from Spotify years ago because Spotify wasn't willing to only let her music be played to paid subscribers (and not free users). Few other artists had the power to do this, both because they're teeny compared to Taylor Swift, and because Swift (very smartly obviously) controlled much more of her music rights than most artists.
Nit: They pay ~70% to labels, not to artists. The artists make much less.
> The actual recording artists? “They’re keeping anywhere between 5% and a quarter.”
https://www.latimes.com/entertainment-arts/music/story/2021-...
They pay 70% of revenue to rights holders. For an artist signed to a major label like Lily Allen, they'll get ~20% of that number after they've cleared their advance.
Maybe they should do that, or offer a premium tier with discounted concert tickets or something?
The business model hasn't changed in like 15 years...
And Spotify needs to remember that if it ceased to exist tomorrow, the artists whose music it depends on would care less than if they lost the ability to sell pictures of their feet.
The implication here is that people as a whole don't value streaming music very much at all, right? I'm not much of a music listener, I've followed the whole evolution inattentively, why is online music of such low value?
Perhaps Spotify overheads are too high, perhaps that 70% goes to the wrong people.
Certainly in my view the disbursement is very wrong. I spend £20 a month and listen for one hour a day. if I listen to 4 artists equally (either by number or by seconds) then each of those 4 artists should get 70% of £5 a month each.
That’s not how it works though, and I fund artists I’m not interested in and never listen to, who are listened to for 8 hours a day by others
Partly because it's such low cost to produce.
A single episode of television requires hundreds of people working for a couple weeks minimum and costs from hundreds of thousands of dollars to millions.
How much does effort does it take to write and record a song? It's closer to a handful of people. And it's usually measured in thousands of dollars, not hundreds of thousands or millions.
A few hit artists spend more because they can afford to, but even that still doesn't compare at all with hit TV/movies.
I think the value of music and books will soon go to 0 though because of AI.
Not sure if that's a good argument, maybe she would've grown just as popular w/o help from a label, but that's why artists sign.
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This however comes down to a matter of scarcity right? How many pop stars have feet on onlyfans vs songs on Spotify?
I've been a Spotify user for a few years now. It's a discovery platform for me. It drives vinyl, merch, and live sales. If you enjoy an artist go see them live and buy their merch.
Why not. Might be hilarious.
I sign away my rights, so I can get promoted, and then they buy a Royce, and it's apparent I'm paid exposure.
It's not fair, and I think it's really mean. I think it's really mean. I think it's really mean.
Oh, they're supposed to share, but they ruined all my dreams. They ruined all my dreams.
Use one of your favorite paywall-bypasses if you’re interested in a good deep dive into sex trafficking and CSM..
https://www.forbes.com/sites/thomasbrewster/2021/06/16/the-s...
Its says 70% of revenues, so even if they reduced overheads and their profit to zero artists would only get 42% more.
> perhaps that 70% goes to the wrong people.
Possibly. Who are the wrong and right people? Some people get a lot:
If you spent £10 and listen to only Taylor Swift I’d expect her to also get £7
Howver I believe if I listen to Lily for 10 hours in the month and you listen to Taylor for 90 hours, then instead Taylor gets 90% of the £14 (£12.80) and Lily gets 10% (£1.40)
That doesn’t seem right.
Music has been very cheap to consume for many many years.
It’s far from the only way people listen to music. I listen to music on FM radio way more than I do free streaming services (mostly Amazon music’s free tier) for the overwhelmingly majority (essentially all) of my music consumption, and have no user-paid subscriptions. Both are ad-supported and probably pay little to artists, similar to paid streaming.
You're being pedantic. Most people do not consume FM radio as their main source of music.
Granted, not all radio is music (nor is streaming), but (assuming I didn’t get the research wrong) radio is larger, making it at least slightly weird to call it a pedantic argument that the larger of the two markets even exists as a source of music for people.
Not really.Other services exist, like Youtube music.