The internet and technology in general have done some great things for music but making money is harder than ever.
How many people listen to a song, how often, and at what licensing rate?
Clearchannel radio claims their network reaches 237 Million listeners a month [1]. If they managed to hit one play for every listener they reach at $132/32,000 that is $977,592 per month.
Yes, its hard to get between 'starting' and 'living large.' And no, not everyone will go there, but the numbers here aren't "really bad" they are in fact pretty good.
One business which is an analog to the current music 'label' business will be similar to what search engine optimizers do, they will contract with a promising artist and say "I'll pay you $x up front, and in exchange for that you will sign over all the income from this song for the next 'n' years to me." Then the muscian gets paid up front, the music distributor/marketer has a chance to make some money, and everyone 'wins.' Once the contract expires all the rights revert back to the artist.
The artist is making a bet that they will get more money for the first 'n' years of the song this way, and the distributor is betting they can make more than that on the song.
The remuneration rate, like the 'average selling price' for a commodity, is the median price of the performance across all requests.
My original point is that the 'size' of the music market, in terms of the number of times a song is played, is very very large. There are probably close to a billion 'plays' of songs on any given day in the US. I'm sure Pete Warden could come up with a way to figure out an exact number, I base that guess on half the population, 150M people, and 6 songs per person per day median, so 900M plays.
If the ASP, to artists, is $132/32000 (not saying it is, just its the only real number we've got in this discussion) that would make a daily sweep of like $3.7M. So if, as an artist you were the top song that day you might take home 1% of that or $37,000.
My overall point is that the music industry that is being birthed out of the ashes of the old one, looks a lot different. It's more 'on demand', it's more relational, and it's less understood. Consequently there are a lot of people trying to mold it to something they can control and get the money out of, and that reality distortion makes seeing the real forces driving it harder.
So when you reason about the music business and someone says "Gee the artist only sees one tenth of a cent each time spotify plays their song.", that sounds horrible! A song, for only 0.1 cent? Gee I'd have to listen to the same song all day just so they could buy a cup of coffee at Peet's. But if that song is reasonably popular and it's being played 10 million times a day, that means the artist is making $10,000 a DAY on just one song. That sounds awesome! The difference between these two is all that probability / market size reasoning that is sometimes glossed over.
> The internet and technology in general have done some great things for music but making money is harder than ever.
I think the amount you can make per listener has decreased but the amount of listeners and reach has increased exponentially. For evidence of this check out all the independent Youtube musicians, there are quite a few securing millions of video views per month, that alone is enough to fund a good life, then if you add in sales, streams (via Spotify etc) they make excellent incomes that they couldn't have got 10 years ago.
Maybe you missed a decimal point? She would need 320,000 listens from 32,000 extremely dedicated fans each month, which is unlikely to happen. If we got this rate up to a full 2 cents (more than quadruple what it is now)your 32,000 plays would still gross her only $640. Not even half the cost of a 1 bedroom's rent in any metropolitan area that I'm aware of.
Whatever deals they cut probably sap the lion's share of the profit, leaving a small pie for the indies to slice amongst themselves.
And of the share they get, I bet a large chunk stays with the label rather than passing through to Gaga and company.
I'd really like to see some numbers on that, but of course they'll never be made public. Which tells the tale on its own, really.
http://www.noisemademedoit.com/how-to-earn-money-with-music/...
There are several things misrepresented by that well-meaning graph, and if it leads you to believe that musicians make more money from Spotify and Last.fm than form Amazon and iTunes, that really should be corrected for, because that is absolutely not the case in my experience, and Zoe Keating's numbers seem to echo what I've seen in the field.
The info graphic cites, among other things, 'industry sources.' Zoe Keating, on the other hand, is a completely transparent actual industry source. Don't be surprised that artists exposing their revenue information make less than you think, be surprised that in 2012 people still buy the garbage statistics handed out by unnamed 'industry sources'
either way, it sounds like there are just anecdotes on both sides, so there's no actual information either way.
I don't think we can conclude that at all, especially in this case.
In the pre-Internet era, the niche for modernist cello music would have been an incredibly small set. If she were supremely lucky, she'd make it to Carnegie Hall every few years, and maybe sell a couple hundred CDs at a given performance there. Her radio airplay would have been limited to NPR, and perhaps a smattering of tiny classical stations. She'd have been touring pretty much 24/7, mostly to small venues, and basically hustling albums out of the back of her van.
The internet has expanded niches, blurred genre lines, eased access, increased distribution, and basically enlarged the footprint that someone like Zoe Keating can make on the world. She might be getting a smaller slice of the pie, but her pie is undoubtedly much, much bigger than it would have been 20 or 30 years ago.
If anyone opened this spreadsheet expecting to see a glamorous story about how Zoe made $3 million in 2 days, I would suggest they reexamine their expectations for the size of the experimental cello music market. She's doing respectably well, given her niche. I would also assume she has supplemental income streams from concert appearances, which have historically been the bread and butter of classical musicians. (Which is not a lot of bread and butter, to be clear, but it pays the bills).
A more interesting discussion, IMO, would be a breakdown of how Spotify, iTunes, et al. have had disparate impacts on different types, flavors, and "sizes" of musicians. For instance, how has the Internet treated the Zoe Keatings of the world, vs. the Beyonces of the world, vs. the Bjorks of the world, vs. the Lil' Waynes of the world, and so forth.
I've listened to a couple of pieces and while, nice, they sound pretty conventional tonally, rhythmically and structurally. I was expecting something a bit more unconventional.
You may notice that some of her works sound like they feature multiple cellists. That's actually one cello, her own, being sampled and layered in real time.
Structurally, tonally, and rhythmically, the pieces tend to vary. But I would agree on some level with your observation; it's not like she's delving too deeply into Philip Glass territory or anything.
Pandora pays a compulsory streaming rate. Similar to radio they're allowed to play what they like as long as it's not on-demand. Hence you can only skip so many times, and you can't request a specific song. They pay both publishing and performance royalties so rightsholders for the publishing and recording get paid.
Spotify, as an on-demand streaming service, has to negotiate direct deals with rightsholders to use the music. So when you see them paying out a lower rate than Pandora it's because they've traded equity to major labels in exchange for better rates — a very clever way for majors to get money directly from subscribers without needing to distribute it to artists. Independent labels and musicians also need to authorize Spotify, but have less negotiating power so they don't get ownership stakes and have to choose to be completely absent from the system or take the rate offered them.