Royalty statements of a Grammy-nominated artist
digitalmusicnews.com
digitalmusicnews.com
Also, for under 15,000 plays across a dozen or so separate platforms for an entire year, this doesn't seem too terrible. People aren't listening to the music very much, so why should a lot of money be paid to this artist? Just because they're Grammy Nominated?
Yup. It's linkbait. The question it answers is how much money do you make with 14,000 plays? Answer, not much.
But he said that he's the label as well and he included that statement in the post. The total was only a little over twice as much as he was paid as the artist.
We do not know what the record company makes off of this, their standard accounting practices ensure that most bands never make any money in royalties, period. When they do "earn" these royalties, they are invariably some tiny fraction of the total profits.
How do they do this? They "front" the bands a service, which includes promotion and management and so much... and they get to decide how much this costs. But they don't disclose it to the band then, or afterward. This magic number then becomes how much the band has to earn before they start seeing royalties. And they get to calculate how much that performer has earned. And when various radio stations and MTV and whoever in the hell else pays license fees, they even get to decide how that is apportioned.
It's no surprise that most bands never pay that amount back.
But, if somehow someone does (they're so popular that gigantic lawsuits would ensue if the record company didn't do this), they still get a piddling fraction of the total sales.
Never mind that you get record company and record label mixed up... the latter is just a brand/logo to slap on the music.
And none of this even gets into how ASCAP and the like screw over indies who never sign with a record company.
Basically, it's an apples-oranges comparison in more ways than just youtube ad revenue != royalties. The metric is different as well.
Of course, your basic point that 15,000 is big number, which should probably be worth much more than 5 bucks, still stands.
This works out to 0.325 cents per play. How does that compare to the rates from these other services?
http://www.hypebot.com/hypebot/2013/01/gangnam-style-music-v...
It may also be a symptom of compulsory fees imposed by a third party.
There doesn't seem to be a number that artists would be happy getting and that music streaming companies could actually offer them.
Also, about spotify and finance: http://www.billboard.com/biz/articles/5070561/spotifys-finan...
Pandora/Spotify are debt-financed. They literally cannot afford to offer their services at the royalty rates they are paying now, and are pressuring musicians to take less.
You can definitely create a service that is popular with consumers if you are debt-financed (see Napster 1.0). That doesn't mean that the service should exist, or that the songwriters should make financial sacrifices to make the service viable.
http://www.digital-digest.com/news-63709-Music-Piracy-Down-b...
With fewer and fewer people downloading music these days, I'm not sure how valuable free downloads even are as promotion any more.
Apple's Ping tried to do that stuff, but it was a massive failure due to other reasons (everyone hates the iTunes app).
Someone’s making money, and in true fashion with the music industry, it’s not the artists.
Who's making tons of money from streaming 14 thousand songs over the internet? I can't imagine this brought in a serious amount of revenue for anyone.
So 14 thousands performance is almost a half million dollar lost of revenue, stolen by those streaming services. Worse, they claim its all moral and legal.
Of course, if the $30 figure is off, and it was really only $0.30 a performance you're right.
$4 for 14k performances of a streamed song seems totally reasonable to me. If you own the song 100% then charge more.
We're talking about streaming audio over the internet, though. I don't think one listen of a song brings in $20 in revenue (advertising and subscriber fees).
[1] http://www.computerworld.com/s/article/9215074/RIAA_request_...
I guess it also depends on one's definition of 'college radio'.
If I listen to a streaming service for 10 hours a week (seems like a plausible average?), that's about 800 songs per month. So I'm probably paying in the range of a penny per song listened to. If I played 14k songs, that's $140. So only 3% is going to the artist[1], which does actually seem fairly low.
To put it another way, he's making the same amount of my subscription as the credit card company is.
1 - We have no idea how much he's previously been paid via advances, etc.
His problem seems to be that people aren't listening to his music anymore, not that he's getting screwed on payments.
Also did he think that the problem isn't streaming services though but the demographics those services have ? They are clearly skewing younger. I would be curious to see his royalties from CD and iTunes sales.
I can't even count how many nominees there are on that page. And that's just for 2014.
I have friends who play in various bands every other week in front of live audiences and guess how much they make?
It's in the range of ~$20 each per night. And that's for about 6-7 hours of "work". Or about ~$3 per hour. "The horror! They are certainly getting swindled!" I can hear you shouting now.
They have to load/unload all of their equipment into a van which takes about an hour. They have to spend $20 or $30 driving their gas guzzler to/fro the bar that's booked them for the night. Spending another hour in travel time as you don't want to take any sharp corners or hit any pot holes with $5,000 worth of musical instruments in the back. They spend about an hour setting up their equipement themselves, testing accoustics and such. And then they play for a solid 3-4 hours. For $20 compensation. Oh, and I forgot that they also get together and practice for about 8 hours every week on top of that.
But that's O.K. because they all have full time jobs and they just really love to write and play music for people.
That's why you should be making or playing music imho, for other people's ears and your own enjoyment. Not to write a few diddy's in the hopes of making a killer profit.
Even before streaming radio became the standard way of listening to music, people didn't pay every time they played a song. They paid for the rights to listen to it as much as they wanted, but they only paid that once.
Now that we have streaming, consumption is different, and artists actually get paid per listen. They can't expect to get the same amount per listen that they got per song on a CD years ago.
You really shouldn't get into music for the money, because there isn't money anymore. The fact that there was money ever was a blip on the radar due to new technology allowing an industry to explode. Technology continued on though, and made the scarcity of music artificial.
I've often thought on a revolutionary model to turn the music industry on it's head, from the current gatekeeper/distributer model (which tries to fight against the 'promiscuity' of digital content) to a 'charitable' model, whereby a non-profit, trusted organization accepts a periodic donation from me and distributes royalties based on my actual listening history over a period of time (which could be adjustable at donation time if I prefer to give my money to an all-time favorite artist, or conversely to a new artist I want to hear more from).
The trusted organization would be where I'd go to download my open-source, torrenting music player & music discovery apps.
For this to work, you'd have to reinvent how to attribute a piece of music to an artist properly, in my ideal world middle men would be cut out, and the money would go directly to the composer/performer. The hard part, but the key to making me want to donate.
The problem as always would be with the major labels, they won't go for anything that weakens their control, but you could certainly start with an indie label alliance of some sort.
So many times I've been jamming to a track and really had such good will towards the artist and would love just to "tip" them some money, but alas had no way to do it. Now we're building that way.
It would be great if creators could be directly compensated as envisioned by copyright, but that is just not how our physics works out. Trying to pretend that's so just enriches (old or new) middlemen, who make money pennies at a time across thousands of artists, treating creativity as a commodity and devaluing it in the process.
The future is here but it certainly isn't Spotify et al, with token compensation based on token control. It's torrents with alternative methods of compensation - concerts, merchandise, kickstarter, donations, commercial licenses. Ignoring this is surefire exercise in frustration.
Musicians somehow expect to write a song and get rich from it, sorry but only the best of the best have the talent to accomplish that. The rest, however, can make a decent living out of it.
And each "play" on the show goes to thousands of people, not just 1, as each Spotify "play" does.
Silly comparison.
How much is worldwide exposure of your work worth? How about the analytics of who is listening to your music and where?
I'm a former pirate of music but today I'm doing my part paying $20/mo to Rdio for my family's music-streaming. Would you like to go back to those bad ol days where you got nothing at all, no money and no analytics?
I understand Netflix does this to some degree to determine the popularity of some shows.
It's possible that the artist has actually made more than the statement amount if people went out and bought his material after discovering it on streaming. Or maybe not. But back when CDs were the only real option, I remember buying many, many CDs for only one or two songs and being extremely disappointed with the rest of the album. As a consumer, I believe I grossly overpaid for music when CDs were the norm. Just because an artist could make X amount before internet radio doesn't mean they should be making X amount now.
If a single fan would listen to your mp3 around 1000 times or more, you hope the fan will stream your mp3 rather than buy it, as you'd make more money that way. Otherwise you hope they will buy it.
As for the "discovery" benefit of services like Spotify, you have to factor in that Spotify also robs paid downloads. Why would someone download if they can stream from Spotify? So, in order for it to make sense, you have to ask if the benefit in music discovery makes up for the cost of losing album/download sales. That's a much higher bar than to just hand-wave and say "Well I buy some stuff I discover on Spotify!"
> Notice one performance of “Ceremonies” or “Distant Lands” streaming radio show like Hearts of Space that brings in 26 cents for the full writer’s share compared to 2,088 performances of “Gypsy Rain” on Spotify that brought in a total of 60 cents.
Spotify "performances" are (probably) going to one or two people each. Radio or live performances go out to hundreds up to many thousands of people.
Now pull your music off Spotify and get a YouTube account so you can turn those impressions into a $2 - $10 CPM
I think people just see big numbers and expect big money to follow, but when you have millions of people that can just graze songs or songs are delivered to them passively, you need an extremely large number of listens to make money.
http://thetrichordist.com/2013/06/24/my-song-got-played-on-p...
His songs seem to have a little bit more exposure than in the discussed article.
I saw a proposal once that I really liked, instead of having all money go into one large pot, and have that distributed among all artists based on the total number of plays, have each subscriber's money distributed out by the songs they listened to.
Basically, instead of having your money combined and split with everyone else for all artists, it goes only to the artists you've listened to, and with amounts based on your listening habits, and not the collective habits.
Having just superficially perused Magnatune's info pages, I couldn't find anything specifying how they determine the amount given to artists, other than 50% of it goes to artists, and the other 50% goes to Magnatune...
In practice people vary in their usage of these services. Basically the artists you listen to would get paid more per play if you didn't use the service much. (i.e., if I only fired up Spotify once this month, listened to one track, then the artist gets my full $14 for one play)
Yes, if you listen less, the artist you listen to get more. Which I don't think is a bad thing, because theoretically using the current system if everyone listens to less, all the artists get more per play.
This system, while not perfect, gives your money to the artists you listen to and support, as opposed to helping give lots of money to artists you probably couldn't give a damn about.
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As for the payouts, I don't think you did your math...
Example:
Person A listens to four songs by Artist 1.
Person B listens to five songs by Artist 2.
Person C listens to two songs by Artist 1, and four songs by Artist 2.
Assuming that $10 goes directly to the artists from each listener, in the huge pot system, artist 1 is played six times, and artist two is played nine times. Artist 1 gets $12, and artist 2 gets $18.
In the individual distribution, artist 1 gets ~$13.33, and artist 2 gets ~$16.77
I'm not saying this is worse necessarily, I'm just not sure why it's better.
I might hate an artist you listen to, and don't think that any of the money I put down should go towards that artist. Similarly, you might hate an artist I listen to, and don't want any of your money going towards them.
In regards to worth, I think a better measurement would be percentage of a user's listens, as opposed to number of listens. While the percentage is based on the number of times they listened to an artist, looking at the percentage only somewhat weakens the argument based on someone listening less being worth more. That argument doesn't really hold with me because you can get the same payment numbers by just multiplying all artists by the same number, and while each individual play is worth less, the artists are still getting the same payout.
Basically I think an individual distribution is superior because .. wait for it .. it's more representative of each individual's listening habits over the collective's habits. Because of this, there's a large potential for smaller, less recognized bands to make more money, because they're paid for the percentage of times the people who listened to them listened to them, as opposed to the percentage of times EVERYONE listened to them.
That would sting just a little.
It can also be rather convenient: you don't have to load up all your music on a device, and if you ever feel like listening to something new, it's really easy to find. But if you're only updating your music library three or four times a year, it's not a big deal.
You also probably didn't need to boot up a virtual machine every time you wanted to sync your phone... But that's a different problem.
Streaming services also typically have a radio feature, where you can specify a song and say "play more things like this". Which I've found is both nice on the "just give me something to listen to" level and useful for finding new music.
The other nice thing about a streaming service is that you may get exposed to something you didn't know you liked.
I was about to quote the annual Pandora One price as being less than the cost of 3 CDs, but evidently I missed where the annual option was nixed due to several increases in SoundExchange royalty rates.
I've never really had good luck with music recommendation services, I always seem to get the safe recommendations from the priors.
But I like internet radio to find those albums. Local FM radio plays a very limited selection, vs streaming where I can hear really cool albums from 5 or 10 years ago that I would have never heard otherwise.
That said, the author should probably consider streaming services as "advertisement", and try to sell recordings and concert tickets.