How Much Does Spotify Pay Independent Musicians?

fossiltooth · Post by **fossiltooth** » Wed Sep 07, 2011 7:20 am

Seems like there's heaploads of misinformation on the web about how much musicians and labels get paid per stream through Spotify.

I decided it was time to do some actual research and came up with this:

Evil, Awesome, or Innocuous: How Much Does Spotify Pay Independent Musicians?

Hope you find it useful.

PS- this is from issue #2 of Trust Me, I'm A Scientist which is out now.

Mudcloth · Post by **Mudcloth** » Wed Sep 07, 2011 10:23 am

Thanks for posting this. I'm really enjoying TMIAS, by the way. Great work.

Fossiltooth, the rest of this post is directed at everyone here and not you specifically.

I've posted these questions on TOMB before, but it bears repeating here:
How much money does one expect to make selling music? What is a fair living? As a musician or songwriter, what do you feel you deserve to make?
These are relevant questions to me and the crux of the streaming music, iTunes downloading, digital copying world we live in now.
Obviously, you earn what the laws of supply and demand let you earn.

I think it's pretty clear that most people balk at paying 99 cents per song, nowadays. At least, not when the alternative is file sharing for free or paying $4.95 per month for all the music you care to listen to. Do you think that in any other industry if your product could be exactly replicated, or bought for a low monthly fee, that there would be any way to compete?
Do you think that if people could replicate a bowl of soup for the low price of the replicating device, that anyone would ever buy a bowl of soup ever again? Why would you stay in the bowl of soup business, then? Not unless there was a significant demand for watching people make soup live and in person or because making soup was what you love doing beyond anything else.

I'm interested in hearing peoples thoughts on this because, as of right now, I hear a lot of people complaining about not making enough money in the music industry but not much on solutions. There aren't too many great ideas on how to make a living selling music in the world we live in today. How much should you make and who pays?
Basically, the music buying population will spend a finite amount on music ,and that amount appears to be going down every year. The amount of bands out there and music released appears to be going up, for some reason. There is just not enough money to go around for all of us to make a comfortable living doing this. If there was we'd have a dire shortage of astronauts and ballerinas.

By the way, I think Spotify is awesome. The reason I'm able to think this is because I'm not too bitter about the state of the music industry.

fossiltooth · Post by **fossiltooth** » Wed Sep 07, 2011 3:19 pm

Good questions. You may have to settle for some very individual answers.

Gregg Juke · Post by **Gregg Juke** » Thu Sep 08, 2011 11:34 am

Mudcloth, you have outstanding questions, but of course, no one has all of the pat (correct) answers, or they'd actually be as rich as we all thought we would back in high school.

For me, making a living means just that-- a decent standard of living that pays the bills, leaves something for retirement, helps me put my four kids through college, and to re-invest in business and new gear. I make my living from music, but not solely from performing music or recording; diversification has been the key. But yeah, theoretically, we all should find our audience and have at least a shot at middle class. How? You got me; it's never been any different, it's just that the "promise of the digital age" has quickly given way to the "reality of the digital age," which is much more like "meet the new boss, same as the old boss."

Here is another article that may shed some light on (but not necessarily conclusively answer) your questions:

http://blog.discmakers.com/2011/08/musi ... ign=EA1136

GJ

Mudcloth · Post by **Mudcloth** » Thu Sep 08, 2011 12:12 pm

What I found interesting in the article is how making any kind of money off of Spotify is going to be dependent on the listener base growing substantially. That combined with people actually listening to your songs, specifically. Tall order for any band just staring out.

I kind of feel that from here on out artists might want to start thinking about trying to get heard above trying to make money selling music. If people become a fan of your music they will want to support you. They will want to feel personally involved. Speaking of which, how many of you buy CDs or downloads as musicians? How much do you, yourself, purchase every year on music?

There's always money through publishing and getting your songs in movies and television shows. There's at least a system in place for those types of income. Getting one song played on True Blood would be the equivalent financially to about a million plays on Spotify.

Anyway, I'm still not hearing about any more solutions to the problem of subscription services not paying enough to the artists. Pretty silent out there.

Mudcloth · Post by **Mudcloth** » Thu Sep 08, 2011 12:27 pm

Gregg, I just posted without reading yours'. You make some great points there.

Yeah, I feel extremely fortunate to have made a lower middle class/just above poverty line type living the last 20 years. It's a constant hustle that involves mainly playing live music, but also running sound, recording bands here at home, repairing amplifiers, buying and selling gear, session work, booking, producing, etc.

I was driving to a gig earlier this week that I knew was going to pay less that $20 [turned out to be $12] and I was okay with it. I knew I'd have fun and it would maybe lead me to more work.

Gregg Juke wrote: the "promise of the digital age" has quickly given way to the "reality of the digital age," which is much more like "meet the new boss, same as the old boss."

Nailed it.

I'm fixing to read that article you linked.

chris harris · Post by **chris harris** » Thu Sep 08, 2011 1:09 pm

Mudcloth wrote:What I found interesting in the article is how making any kind of money off of Spotify is going to be dependent on the listener base growing substantially. That combined with people actually listening to your songs, specifically. Tall order for any band just staring out.

I kind of feel that from here on out artists might want to start thinking about trying to get heard above trying to make money selling music. If people become a fan of your music they will want to support you. They will want to feel personally involved. Speaking of which, how many of you buy CDs or downloads as musicians? How much do you, yourself, purchase every year on music?

There's always money through publishing and getting your songs in movies and television shows. There's at least a system in place for those types of income. Getting one song played on True Blood would be the equivalent financially to about a million plays on Spotify.

Anyway, I'm still not hearing about any more solutions to the problem of subscription services not paying enough to the artists. Pretty silent out there.

I don't think that the problem of "subscription services not paying enough to artists" is a problem that exists. I definitely don't think that was the point of the article at all. I think that between 1/2 to 1 cent per stream, straight into the pocket of the artist is fair.

You're right that as the paid subscriber base grows, so will the amount of this payment. But, this method also provides incentive to make music that people will actually want to listen to. It will no longer be just about a good P.R. campaign and first week sales. The music that's listened to the most will earn the most money.

But, obviously, publicity and awareness are still the most important parts of earning a living from music. It doesn't matter whether you're just releasing records digitally, pressing vinyl, going for licensing deals, or touring year round. If people don't know about your music, they won't look for it.

I buy an outrageous amount of music. Pre-Spotify, I was buying an average of 2 records on iTunes, and 2 records on vinyl every month. Now, I just spent the $10/month for Spotify. And, I still buy the 2 vinyl records every month. The vinyl that I purchase varies from about $15 to $25 per record. So, i'm probably spending around $300 per year on music. It's still way less than what my cable television bill costs me.

I guess I just don't understand what the problem is that you're seeking answers to. Not everyone who wants to will be able to make a living from music, no matter how much work they put in. Same thing with athletics or acting. I'm sure that there are plenty of examples of people who are wildly talented and have crazy success without working very hard. But, for each of these people, there are THOUSANDS who will work their butts off and not succeed. This is art. Just because you try hard, doesn't mean that people will like what you have to offer.

At least Spotify is paying the artists. And, at least they've provided a legitimate way for people to have access to virtually everything in a way that's legal and fair for the artist. I'm sure there are plenty of artists who would rather have the $15 up front, and then not worry about whether or not the listener actually listens to the record. I don't really feel sorry for them. Technology is phasing out that model. And, at the same time, this technology is giving the people who mainly just wanted free music to listen to, what they want, while also supporting the people who make the music. I feel like this is the ultimate win/win.

Mudcloth · Post by **Mudcloth** » Thu Sep 08, 2011 4:14 pm

Chris,
I agree with what your saying. I guess I always come back to "subscription services not paying enough to artists" because this is what I hear people complaining about the most.
I'm actually not seeking a solution to a problem that I feel is my problem. It's more of a question directed to those out there that feel like Spotify doesn't pay artists enough. I was a little vague about that here. In general, I hear a lot of complaining about poor ol' musicians not making any money nowadays, as if someone is forcing us to do this.

I totally get that not everybody will make a living at this. That was kind of my point. If everyone did well playing music then everybody would be doing it. Shit, it seems like everyone is doing it right now. It's like being in a band is a prerequisite to being in your 20's. "Yeah, I'm in a band. We're called The Giant Kings Of Magnificent Greatness and we're playing at the VFW on Tuesday night. You should come on out." Will do.

Anyway, I am perfectly happy to give away my songs for free with the option of a donation. That's actually what I'll be working on soon. It will be a ?Come to my website and download as much as you like? scenario.

I am totally down with Spotify. I'm loving it. I'm going to put my music and my band's music on there very soon and I don't care what the royalty rate is. If it helps us get the word out, I'm in.

fossiltooth · Post by **fossiltooth** » Fri Sep 09, 2011 10:13 am

I agree with a lot of what's being said on both sides. I really like Mudcloth and Chris' perspectives and forward thinking, but I also think we'll ultimately have to do a little collective bargaining to ensure a higher, more sustainable rate for the sake of the few who do become professionals.

I'd have to crunch the numbers some more, but at first glance, I think I'd like to see something closer to 1-2 cents per stream guaranteed across the board further down the line. I also imagine that some of the more successful artists may be able to negotiate bonuses for making their albums available through the service at all.

We'll see. It's likely that creating a model that could work well for a few decades to come will require real advocacy, just like we had at the advent of both radio and recorded music.

So far, the direction that Spotify is going in seems increasingly positive. But I think we have to remain vigilant. Cutting them a little leeway while they get off the ground is one thing. Giving them a free pass is another.

However it goes, I'm glad that we're starting the discussion. For now, all I'm only interested in providing the facts so that we can have a worthwhile one. In the end, I think Gregg said a lot when he wrote:

Gregg Juke wrote:it's just that the "promise of the digital age" has quickly given way to the "reality of the digital age," which is much more like "meet the new boss, same as the old boss."

For better and for worse. It's always both, I think.

Cyan421 · Post by **Cyan421** » Mon Sep 12, 2011 12:16 pm

chris harris wrote: At least Spotify is paying the artists. And, at least they've provided a legitimate way for people to have access to virtually everything in a way that's legal and fair for the artist. I'm sure there are plenty of artists who would rather have the $15 up front, and then not worry about whether or not the listener actually listens to the record. I don't really feel sorry for them. Technology is phasing out that model. And, at the same time, this technology is giving the people who mainly just wanted free music to listen to, what they want, while also supporting the people who make the music. I feel like this is the ultimate win/win.

Amen to that!

What I want to know about spotify is what does "Enhanced sound quality" really mean. Some of that stuff sounds like 128 mp3's

highway51 · Post by **highway51** » Tue Sep 13, 2011 7:06 pm

I don't necessarily think spotify is the future for the states but its pretty popular in some european countries so unless you are already making a substantial amount of money through downloads and have alot of fans willing to pay for your album I'd go ahead and put it on spotify. The first month I put my music on spotify my music recieved more plays in the first month than my soundcloud account has had all year, and soundcloud doesn't pay me.
I've been going through tunecore for the last two years and my experience has taught me that you should be in every store and site that'll have you. Some people get caught up in certain sites and use spotify or emusic exclusively.

highway51 · Post by **highway51** » Tue Sep 13, 2011 7:08 pm

soundcloud this year 560 plays
spotify this month 780

themagicmanmdt · Post by **themagicmanmdt** » Thu Sep 22, 2011 9:13 am

great article, fossil! digging the issues, so far, btw.

i feel that the ease of distribution and somewhat cheap and easy home recording has lead to a horrendous onslaught of songs and music that swamps out our brains.

i have a hard time spending the time clicking through, filtering and listening to all of this stuff for the sake of enjoyment. there's just too much out there that anyone is throwing up, and that i'm being subjected to.

it was almost like there was a 'checks and balances' system back in the time of vinyl records and a big music market - you had to be good, have your ducks in a row, and then - you get a recording and a release.

now, everything's thrown onto the woodpile.

yeah, it's the freedom to broadcast and sing freely and get 'out there' very very easily - but when the forest all of a sudden is screaming with birds, you just end up deaf.

i, personally, am turned off by a somewhat big 'filter net' of both legendary artists and independent artists that don't seem to have any kind of 'check' system before it's imported into the system. yes, i know, the power is in my hands to hit yes or no - a wonderful concept - but i don't have time to play that game. there's other things to be done than for me to now deal with a massive media onslaught glowing at me and that i have to play 'police' to decide what gets in my door - or in the stream that i'm paying for.

i'd still rather have a DJ that has the spirit of the town that i live in - which has the vibe that i enjoy - playing whatever he finds. that way, he gets paid, has a job - and can turn me on to things while i just sit and solder.

this internet thing - it's all a wash - it's all too big - it's a nice idea - wikipedia, and the power to search for specific things when we want them - it's a digital card catalog with people's individual nests - but the rest - it's a wash -

buzzes like a fridge. talks in maths. like a detuned radio.

.006 cents (ha!) from me -

chris harris · Post by **chris harris** » Thu Sep 22, 2011 9:21 am

You'd probably love Spotify Playlists.
The new DJs. Choose your own arbiter of taste. An even more personal form of discovery. In fact, I bet a few people you respect already have some great shared playlists.

Dr Rubberfunk · Post by **Dr Rubberfunk** » Fri Sep 23, 2011 2:34 am

Nice article from TMIAS - great points raised in this thread too.
I like Spotify as a platform, and I like the fact I've had a few royalty payments (however micro) from them, and that artist payments were part of their model from day one. I like Last.FM as a platform too, but have only recently started getting payments from them, despite over 5 years of streaming my tracks there. (Always wanted to get in some kind of gag about preferring the 'pre CBS years' but never quite been able to work that out

)

I like Youtube as a platform, but hate the fact that Google effectively get music as free content and don't give me, or any other independent artist as far as I can tell, anything at all. That said, I'm trying to populate my youtube channel with as much of my own music as possible, with some sort of video, rather than rely on other people uploading terribly encoded versions with slide shows in comic sans and a picture of the wrong album artwork

And Spotify playlists are great

Don't think it's available in the US, anyone in the UK using mflow? Another take on the streaming model, where users get paid for referring tracks to other users who subsequently purchase said track ...

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