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Comment by cletus | Hacker News Reader

Man I'm sick of hearing this particular complaint.

Let's look at the numbers. 1M plays for ~$42. Sounds like not much right? Wrong.

Yes AM/RM Radio paid ~$1500 but for 20,000 plays. Now ask yourself this question: how many people heard those 20,000 plays? If the rate of pay was the same ($42/1M) it would have to be 35.7M listens. Well, at 20,000 radio plays that averages 1800 people per listen. Is the likely audience higher or lower than this number? It's bound to be higher. So streaming services are in fact paying more (per listen per listener).

See http://davidtouve.com/2011/12/13/uk-radio-versus-spotify-a-c...

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I think part of what drives the complaint is that a song being on Spotify is much more valuable to the listener than it being on the radio. There's a spectrum of value ranging from the radio at the bottom (you are subject to the whims of the DJ on when and where you hear the song), to Pandora (you still aren't in complete control, but you have a lot of influence), to Spotify (you are in complete control as long as the song remains on Spotify), to owning the song on an album or as a DRM-free download (you are in complete control forever).

I think since Spotify is so much closer to owning an album than it is to radio, many artists expect it to be closer in value to album sales than radio plays.

Not saying ignorance of the proper comparison isn't happening, just that it might not be the only reason.

When I was a kid (Napster era) I paid for nothing. The artists weren't stream-able, so there were no royalties either. Today I buy every damn song I listen to, thousands of dollars worth. When an artist I like comes out with a new CD, I buy it immediately.

I don't use Spotify or Google Music. I don't know what they pay to the artist. What I do know is my friends that use them have zero reason to buy a CD. I also know even the more obscure stuff shows up on there. Once they are older and have a family, they certainly don't have time to go to more than a couple of concerts a year, and they most likely are not wearing band t-shirts past 30.

The way radio worked, you heard a song once and a while, liked it, most of the artist's other songs you rarely or never heard. There was a big incentive to buy the CD.

Musicians need to have a freemium model, where you get free, unrestricted access to some songs, and then if you absolutely love the band you pay for the rest (or you can pirate it, but there are a few hoops to jump through for that one.) It has to be convenient, on demand, and a single standard. May be its lossless audio, or may be its just mastered differently. Someone who knows more about music would have to figure it out.

Despite all of this, my favorite musicians regularly release new albums. There are a few duds, but the music is good. Countless genres blended together and mutated, with virtually unlimited choices. As far as I'm concerned, this is a music renaissance.

... " they most likely are not wearing band t-shirts past 30."

hey there now, sonny. I'm 51, and some of them still fit just fine, thanks. I even go to several concerts each year.

Seriously. My father, while he was still alive, wore way more band shirts than I ever did.

"Today I buy every damn song I listen to, thousands of dollars worth"

Why do you do this? You know that most of the money for an album doesn't go to the artist? Do you buy the physical CD or do you buy the song on iTunes?

The vast vast majority of people do not have thousands of dollars to spend on music.

Why do you do this? You know that most of the money for an album doesn't go to the artist?

You don't know that, because you don't know what sort of music he listens to or what deals those artists have with their labels. There are certainly cases where labels fuck artists, but there are a lot of others where they deliver value. This idea of blaming all the big bad labels is little more than an excuse not to pay for music. Along the way, it's crushed lots of small independent labels that had great partnerships with their artists but get blamed for the perceived moral failings of the majors.

So why didn't those small independent labels ask their artists to come out swinging for them and champion their cause? Or better, why didn't the artists who (apparently) loved their labels advocate for them in the greater public media?

> Why do you do this? You know that most of the money for an album doesn't go to the artist? Do you buy the physical CD or do you buy the song on iTunes?

You know that if you spend $0, the artist gets nothing, right? Then their label drops them because they aren't profitable.

>if you spend $0, the artist gets nothing, right?

not necessarily. I'm quite happy to be shown ads while I stream that generate revenue for the artist.

The share that the artist gets doesn't change just because it's ad revenue. You simply pay less and the artist gets less.

Unless you do what I do, which is mail a check directly to the artist.

I'm not even kidding. Nothing is stopping you from writing a $50 check and sending it as a donation.

I buy at least $30 of music each month from iTunes. Finding the addresses of these artists, writing a check and sending it their way would be more hassle than I care to go through.

If the artists don't like the deal that labels are giving them, they don't have to take it. They can build their own fan base, learn marketing, get exposure and sell their own stuff through iTunes and other places. A lot of artists are opting to do just that.

Right. Cause you're totally just staring at the screen that is playing the music, not at all doing something else while the music plays.

I'm not sure what you're arguing against here. Is it a problem that he spent thousands on music? In the last 7 years I've spend circa $6,000 on one service alone (emusic). I used to spend $500+ per month on vinyl. Hell, I even steal it sometimes too.

I know that the money doesn't all go to the artists - what would you have me (or the GP) do instead, not pay for any of it?

> I know that the money doesn't all go to the artists - what would you have me (or the GP) do instead, not pay for any of it?

Mail them a check. Mail them cash. Hand them cash in person. Send them bitcoins; if they're tech-savvy enough.

That's disingenuous. How well would it scale for a musician to personally handle depositing checks from millions of fans? There is a very good reason that many musicians become involved with labels, promoters, distributors, etc., which is to free up the time of the artist to focus on what they are actually interested in doing: writing and playing music.

> How well would it scale for a musician to personally handle depositing checks from millions of fans?

Like many scaling problems, that's a good problem to have: at that point, you can afford to have people working for you depositing checks, which is pretty much the inverse of the power relationship artists have with labels.

> the inverse of the power relationship artists have with labels.

You don't know what the relationship with the label is. Some artists come in with their own label and only need distributor to reach a bigger audience (artists $$$/labels$$). Some come in completely unknown and the label has to front all the money (artists $ / label $$$$), and some are quite happy to be on a smaller label and let the label handle the business side of things.

> at that point, you can afford to have people working for you depositing checks

...and paying royalties for samples, collaborators, songwriters. Well now we have to hire a guy to handle all of this and you can either pay him/her a salary or a cut of the sales. Now we've slipped back into the label distributor problem.

>How well would it scale for a musician to personally handle depositing checks from millions of fans?

Many of them do a good job handling fan mail. It sounds like a nice problem to have.

>There is a very good reason that many musicians become involved with labels, promoters, distributors, etc.

There are some good reasons for artists to outsource administrative errands, management. There's also the crappy reason that is the monopolization of the major distribution channels.

And then steal the music? Then I wouldn't get to enjoy artwork like this: http://www.popsike.com/Lemon-Jelly-Lost-Horizons-LP-NM/29060... :)

The issue I have is that the very first link in this search: https://www.google.com.au/search?q=lemon+jelly+flac

should be a link to somewhere I can buy albums for $10-15USD each.

I have been steadily moving to buying only digitally released music, but some artists and labels make this very difficult.

Doing it right are:

* Boomkat.com (reasonable FLAC surcharge)

* digital-tunes.com (same price for FLAC/MP3)

* bleep.com

* hdtracks.com (sort of, the markup is massive)

Failing are:

* Amazon, iTunes et al - ~256kbit-ish music, often mastered terribly. (Yes, I'm aware that AAC is a bit higher quality at the same bitrate)

* Beatport.com (you want me to pay how much extra for WAV?!)

* Almost every major label - I can't order lossless tracks from most of them

It's an interesting question. Do you have a moral resposibilty to make sure the money you spend makes it to the artist, or did you just justify your lack of moral effort by saying "well I 'paid' for it, meh..." and how might this be different that just paying a few bucks for a Pandora membership.

bandcamp is where that freemium model lives.

If it's on the radio I believe I can record it and play it at my leisure - as a 12 year old with a budget of $0, this is how I obtained most of my music. Has time shifting become illegal? If not, I am not at the mercy of the whims of a DJ, no more than I am at the whims of when a TV station plays episodes of Doctor Who - once it's on my DVR I have it forever.

I own radio stations. We pay about $0.50 per song played in music rights fees over the course of a year.

Those 20,000 plays are worth a solid $8k to $12k in music fees. (my stations are about industry average in terms of sales; rights fees are based on a % of sales, so the fees can be dramatically higher in sum for a large metro station)

Bottom line, musicians are getting screwed across the board. The music rights companies are collecting much higher fees from the streaming services than they do for radio stations (music radio stations will typically pay 10% to 15% of their sales to music rights; depending on the bracket their sales fall into), but the point that remains the same is that the musicians are getting chump change out of the deals.

We've got a little-known radio station in the Denver metro area that plays non-stop music with no commercials.

103.9 FM: http://rocktherockies.com/

I've been listening for years and the only "commercial" I ever hear is some infomercial type segment early sunday morning for a half-hour. Other than that it's non-stop mostly old or obscure Rock. I wonder if the Sunday-morning infomercial is just to set the "advertising" base?

I looked into the station once, and it seems to be run by a wealthy, reclusive guy as a hobby. Wherever he goes in the Denver area, his library reaches him. Expensive hobby...

Half hour infomercials can be very lucrative in the radio business (particularly if they reach a metro like Denver). I would say that guy is covering a lot (or all) of his costs with it. He could definitely be generating anywhere from $2,000 to $5,000 per 30 minute infomercial depending.

You can buy cheap stations for between $100,000 and $500,000 these days. KYEN / 103.9 FM, is a 16,500 watt station, and if that fully covers the Denver metro based on its tower location, then it's worth a fair chunk of money (low 7 figures). My guess is the owner has had it for a long time, before FCC radio licenses were auctioned; back when you could just pay a small licensing fee and apply for it.

I've seen a couple of cases like what you're describing, where someone owns a station as a hobby essentially. If you're running a very tight ship, it doesn't take a lot to pay for basic operations.

KYEN is certainly an interesting station. It's not uncommon for it to go off the air for days at a time. I assume that's because it's completely un-manned (there are no DJs), so occasionally someone has to find time to go into the building and reboot a piece of equipment.

Lets look at this a different way because comparing to broadcast radio is dicey.

I pay for Pandora One. It costs me $36 dollars a year. Assuming all songs are exactly 3 minutes long & I listen 24/7 for an entire year...

((42 U.S. dollars) / (1 million * 3 minutes)) * (1 year) ~= $7.36

That doesn't seem like a bad deal, 1/5 of my yearly fee going to the artist, the rest to operation and profit of Pandora.

... the thing is, I don't listen to Pandora 24/7. At best I listen a few hours a day, on average for a whole year maybe an hour a day. With that, the ratio drags down to 1/100 of my yearly fee. Once cent of every dollar I spend on a music service ends of going to the actual musicians? That sucks.

Maybe the license fees go more to groups above the artist that don't deserve it, maybe Pandora's operating expenses eat up most of the pie... I don't know who to blame for the situation, I just know it's rigged against the people actually creating the music.

And this is why pirates don't feel bad about copying music. When it is damn near impossible to consume music without 99% of the cost going to the distributors, why should anyone feel bad using distribution systems which don't charge?

Buy physical music from local shops and go to shows and buy tickets from local distributors. (I'm lucky to live in a place where I _can_ see top shelf music without paying the Ticketmaster ransom) Especially buy swag at these shows if you're really interested in your money getting to the people who deserve it. Otherwise, it seems pretty clear that any other way of 'legitimately' buying music pays nearly everything to the middle man.

You may be sick of hearing the complaint, but the real problem is that the complainers are misinformed.

Sounds like Pandora needs to put real pressure on getting those reports revised to be clearer. It's unwise to be hated by the industry that you depend upon.

I don't think so. Pandora is much more narrowly tailored to the individual listener than radio, and radio is so corrupt that is' not a good model to start from in the first place.

People do forget that the older markets were smaller, more controlled so more people were funneled through them such as radio. Services like Pandora, Spotify and even iTunes are really better in nailing down real listens and tracking much better (who knows how many true listeners there were really in the past other than Nielsen type predictions) but also there were less avenues to get content so it was more valuable to get on there.

It is the same problem in games with the previously distinct console markets where you can get more per game because there are less options. Now there are tons of options and it is about bigger user base at a lower per sku revenue take.

The internet based services are more open and there are more of them vying for your attention (which is good) but that you need to do more amazing things to stand out than before.

The controlled markets like radio, movie distribution, consoles (sort of -- Xbone from next gen) since they are controlled/limited and the costs are higher to get on them, they to get bigger takes. But they aren't necessarily better. Many artists, movies, games aren't seen on those or would even be possible if they were still tightly controlled and limited markets. It doesn't make it easier to succeed, it adds more competition and they end up being bigger markets but there is less exclusivity to it. In the end this is good I believe but artists that would never have been seen for instance can now actually be seen at least in access and not locked out. An artist can now get verifiable tracking counts as well as before a station might cheat them like a publisher might do in books/games since it is estimated or trusted to the publisher/stations to report correct plays.

Wait what? $1,500 for 20,000 plays? If the average song is 4 minutes long[1] that's 55 days of continuous music. So, a radio station that played non-stop music, 24/7 for a year is going to pay just under $10,000 total in royalties.. for a year.

That's pretty amazing, but I guess it's a matter of supply and demand: there's an awful lot of music (and a lot of it is awful).

1. http://a-candle-in-the-dark.blogspot.co.nz/2010/02/song-leng...

That's not the case. Let's assume we're talking about an average radio station, in terms of sales.

Music rights are negotiated as a % of sales, not on a per play basis. So large stations with large sales pay a fortune in music royalties. It's not a set rate.

With an average station, those 20,000 plays cost a radio station $10,000 +/- a few grand depending on the sales category they fall into with the music rights companies.

24/7 music for a year would cost around $60,000 (for said average radio station).

Note that OP is only talking about 60% of just the writer royalties. He provides no data about other payments, like performer royalties.

It was not played by one terrestrial station, but played by all the terrestrial stations that signed the royalty contracts with the company which represents the artists and collects the royalties. Of course, the company gets a big chunk of the royalties.

Seems about right. I don't imagine your average radio station is generating a fortune.

The margins vary wildly in radio. It's a sales driven business, once you meet core costs it's 85% gravy after that (the only things that scale with your sales are the music rights fees and commissions paid to sales persons). I've seen mom & pop stations that can't get by, and I've seen modest small market stations with 40% margins because they run a slim ship.

Artists need to quit thinking of Spotify/Pandora as revenue generators and more as advertisement for 1) live peformances and 2) quality physical goods (nicely pressed vinyl, for example).

The days of radio-only hits are over (or close to being over).

I reject this line of thinking completely. It leads to artists concentrating on monetizing existing art rather than creating new art. That's bad for society. Furthermore, live performances? Really? So that guy that creates an amazing piece by himself using Garage Band or whatever, but can't perform it live: he's just screwed?

And it's also just bullshit logic. It's the equivalent of saying that photographers should give up getting a decent commission on their photographs, and instead concentrate on selling champagne at a high mark-up at their gallery exhibits.

Also, radio stations only play your song for a couple seasons, an entire year if you are lucky and maybe more if you are one of the most successful bands. Pandora and similar services are always around 24/7.

The solution to the problem is right in the blog title:

... "Less Than What I Make From a Single T-Shirt Sale!"

If you are good enough (and lucky enough) to get your music heard a million times, then use it as a platform to sell real, tangible things to the people that enjoy your music.

The conversion factor you're using is completely invented, though, extrapolated from the current rates. The fact is that internet radio provides census precision for playcounts, which (I and some others think) should make those listens more valuable. In another sense, listeners are effectively filling out a survey for each play, giving the stations more information about their listeners, but the stations are keeping all the value for themselves. Even though there's an orthogonal problem of royalty rates that the stations labor under, this setup is more of the same.

I did a bit more math here [1] based on Arbitron numbers for radio stations. It turns out that he IS likely being paid more per listener on Pandora.

[1] https://news.ycombinator.com/item?id=5935672

Sure, but the thing is that broadcast radio numbers are also a guess. They have always been a guess. In my more cynical moments I'd say that current rates are engineered to hide the fact that the radio advertising industry has been pulling a fast one for the past 75 years.

Each play in Pandora is only listened by one and only one person. Each play in terrestrial broadcasts is listened by potentially thousands of people, depending on the demographics of the covering areas. So it is uni-cast vs broadcast.

If the OP understands the difference, has a reasonable estimate on the number of listeners for broadcasts, and is reasonably good at calculation, he would find out that Pandora actually pays more.

Plus, Pandora provides more and better services to the listeners for the artists than terrestrial broadcasts. A simpel example. I am working and listening to Pandora. A nice song catches my ears. I could immediately look at the song, its album, the artists, and all other related information. Terrestrial broadcasts don't provide such a service. So Pandora is providing a deeper and more comprehensive marketing for the artists than terrestrial broadcasts, and it reaches more diverse population. That is a big benefit that the OP does not consider.

<edit> grammer

Well some radio stations do provide information about a song with the right equipment. HD Radio has that capability, as well as RDS (radio data system) which may be found in more modern radios before HD spectrum. That said, many radio stations that broadcast an RDS signal may not actually provide correct information. Pandora, Spotify, Google All-Access, et al., certainly do a better job about informing the listener and as such I'm better informed about the music I now listen to.

I find it interesting that SV is normally in favor of capitalism and free markets, yet some seem tolerant of the government forcing content owners to license their content at a fixed price.

There is often more inovation in a space when the market participates are left to decide on their own what to do.

Consider that a lot of us see the extent of current copyright restrictions as a massive overreach.

A totally "free market" in terms of intellectual property would be to totally remove copyright and other artificial IP restrictions, not one where IP owners have free reign.

As such, compulsory licensing is a way of reducing the impact of restrictions that would not have existed in the first place without government interference in the market.

Government is the one granting the licensing rights in the first place, so neither position (fixed or non-fixed price licensing) is in favor of free market capitalism.

An average radio audience of 1800 is not as low as you think.

1 M people within range of the average radio station /

10 radio stations per market *

5% of the time the average person spends listening to music radio

5000

I am not any sort of industry expert, and I could conceive of my numbers being off by a factor of 10. My point is that I don't think you can dismiss out of hand the chance that radio stations are getting fewer than 1800 pairs of ears per play.

You are using the total amount paid to songwriters for pandora ($42) but only the amount paid to him for AM/RM Radio ($1500). Your math is wrong.

indeed. i am also equally sick of hearing this complaint. tho, it's for a different reason.

music is not a freakin' product, people. it's a service. musicians are PERFORMERS. outside of the last 60 years or so, there was no such thing as "selling music" where you're not talking about sheet music. musicians get paid for performing.

the last 60 years has been a music bubble. welcome to the correction.

m3mnoch.

It's kinda hard to get a regular performance gig when a venue owner can simply throw on a CD or pay a few $ to a DJ. Jukeboxes massively undermined the market for jobbing musicians.

uh, no.

so, what you're telling me is your [i mean the royal 'you', not necessarily you you, anigbrowl] performance isn't as good as cd playback? people would rather listen to your cd than listen to you?

makes me think you should either 1) change careers or 2) get better.

see? the technology gets dumped on as a scapegoat. we all hear this. this case is no different.

the real issue? competition has moved back to the streets instead of in the promoter's office. you're still fighting to get heard. and you still have to be good. and you still have to be lucky. because these days, every tom, dick and harry can become "a musician" by putting out a cd. it's the same fight every creative industry is fighting right now. it's just that professional photographers don't really have a pandora to shake their fist at.

just be glad it's not the 16th century and the only way to earn money as a musician was to get commissions from nobility. the phrase "starving artist" exists for a reason.

m3mnoch.

Apples to oranges, and you know it.

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