Comment by isostatic | Hacker News Reader

Comment by isostatic | Hacker News Reader

Parent Full thread

> For example, Spotify says that its average payout for a stream to labels and publishers is between $0.006 and $0.0084 but Information Is Beautiful suggests that the average payment to an artist from the label portion of that is $0.001128 – this being what a signed artist receives after the label's share

https://www.theguardian.com/technology/2015/apr/03/how-much-...

This seems to clear it up

> We aggregate all of this revenue from these two streams, and distribute back 70% in royalties based on a pro rata share in accordance with the popularity of a piece of music. For example, if one of your songs has been streamed 1% of the total number of streams in a month, you will get 1% of the 70% of royalties we pay out to rights holders.

http://www.musicthinktank.com/mtt-open/how-does-spotify-pay-...

If the latter is true, let’s assume everyone pays $15 a month for Spotify and there’s 1 million subscribers each listening to 1000 songs a month

900k listen to Ed Sheeran exclusively 1000 times

100k listen 1 times to each of 100 indie bands.

Total revenue $15m Total royalties $10m

Ed Sheehan gets 900m listens

Each indie band gets 100k listens - total 10m listens

Ed Sheehan gets $9.9m Each indie band gets $1k

You’d think that the $15 the Indy subscriber would pay would go equally to the 100 bands - giving 15k per band, and 9.4m for Ed, but it apparently doesn’t work that way.

Those who binge listen are subsidised by those who listen rarely.

That’s my understanding anyway, but it seems to be based on a line from an “artist in residence”

It's obvious when you think about it. Artists get paid per stream but users only pay per month. When someone listens to more streams than they have paid for, the money has to be taken from someone who has listened to less streams than they paid for.

I guess the confusion comes when 10 fans only listen to Band X, but band X gets less that $100 a month.

I listen to say 1,000 songs a month on Spotify, at $10 a month royalties that’s 1c per song. If I listen to song K 10 times I would think they’d get 10c from me, but they don’t neccersarilly - it might be 1c, it might be $1.

There’s a sad effect - if I listen to 2 hours of Band A and 3 hours of Band B, but Band A has an average track length of 2m and Band B has a length of 4m, Band A would get more than Band B!

A fair algorithm would look like this. A user pays $10 per month. They listen to music for 1hr per day. That is 1,800 seconds. The bands they listened to should be paid 0.55c per second.

You need a per user second rate (Calculated monthly), applied to the streams they actually listened to on a per second basis. Yes, it is a large calculation, but simple compared to most ML problems.

3600 seconds a day, or 108,000 seconds a month, but the point stands.

That would be 1 cent per 108 seconds, so listen to an 8m35 version of American Pie and Don McLean gets 4.75c. Listen to Heartbreak Hotel, 2m08, and Elvis gets 1.18c. Listen to a 1 hour podcast of "The Infinite Monkey Cage", and the BBC get 33.3 cents

If you listen 24/7, or 2,592,000 seconds a month, then your $10 means that Elvis gets a mere 0.05c

Oh yeah, hehe - that should have been obvious to me. 108000 seconds a month.

You calculation are bang on. Elvis getting a mere 0.05c seems fair in the case of this super user when the user needs a flat rate to consume and all the content providers need to be fairly compensated. If this doesn't seem fair then your issue is with the flat pricing per user per month. Which, without this, I'd bet the pie is much smaller.

Reply on news.ycombinator.com