One of the reasons the adoption of Spotify has been so widespread is because the terms under which the bands and labels get paid are so secret. No one wants you to know what they get paid. Not Spotify, not the bands, and not the labels. This is why they don’t release information to the bands and labels for 3 months. They want you to get use to leaving your music up there. If they provided you with up to the minute revenue numbers, you’d get frustrated and pull your music. Spotify wants you to tell your fans that their music is on Spotify. They want your fans to get used to listening to the music on Spotify. They want everyone to get comfortable, and just forget the fact that you’re not making any money.
Here’s a list of misinformation provided to the world by articles and comments.
Fair Play? A Million Spotify Streams Earned Gaga $167
“According to Swedish paper Expressen, 2009’s standout breakthrough artist Lady Gaga and her songwriter Redone made just SEK1150 (£100.76; $166.56) in songwriting royalties from one million Spotify plays of her hit Poker Face in Sweden in the first five months after Spotify’s launch in October 2008, according to figures from the Swedish Performing Rights Society (STIM).”
Fair Play? A Million Spotify Streams Earned Gaga $167
“STIM told paidContent:UK that Universal Music-signed Gaga actually generated SEK 2,300 (£201.53) through plays of Poker Face—she keeps half while the other half goes to STIM, which handles songwriters’ copyright payments in Spotify’s native Sweden. STIM points out to us that Gaga has her own separate deal with her label when it comes to streaming—I asked Universal to tell us what that relationship is, but have yet to receive an answer.”
How Much Does Music Artist Earn Online?
Projekt Records: Spotify Is ‘Not a Viable Way Forward…’
“Let’s discuss the economics. For a play on Spotfy…. NOW READ THIS CLOSELY….. $0.00029 is paid to the label/artist. There is the math, plain and simple! 5000 plays generates around $1.45. In comparison, 5000 track downloads at iTunes generates almost $3000. You have probably seen this article in The Guardian; over a five-month period, 1-million plays of Lady Gaga’s hit ‘Poker Face’ earned just $167. Really.”
Projekt Records pulled their music from Spotify and sited the Lady Gaga article as it’s reasoning. But after this press release got posted on every big digital news site, a lot of people were disputing the numbers provided. Then magically Projekt pulled their latest streaming numbers from their distributor and released a correction.
“After pulling the latest reports from our Digital Distributor, I have revised numbers for what Projekt is paid per Spotify stream. It is “better” but not “better enough” to change my beliefs. These all-you-can-eat services are an unworkable business model for labels & artists.
However I do want to be clear about what the pay out is:
For a play on Spotfy…. NOW READ THIS CLOSELY….. on average $0.0013 is paid to Projekt. 5000 plays generates around $6.50. In comparison, 5000 track downloads at iTunes generates almost $3000. To be clear: I am not suggesting that every stream would have been a sale at iTunes. Believe me, I understand the reality of the music business. I am providing that as a comparison for you. Let’s look at this another way: To earn the U.S. monthly minimum wage - $1160 - 892,307 plays a month are needed at Spotify. This is not a viable number for artists.”
Notice the issue? Projekt didn’t want to tell the world how much they were making, nor how many streams they were getting. So they just quoted and linked to the Lady Gaga article. But under intense scrutiny from readers, they had to release it.
Funny and confusing comments from that Digital Music News article.
The funny part is, that reply was actually made by a Spotify shill that owns a sites that tracks Spotify music tweets and displays them as a stream on their site. How do I know this? Cause the screen shot he posted was originally from his blog post. He seems to be making a lot more than the rest of the world. Wonder why?
How about comments on same press release via Hypebot?
“$0.00029 is simply false. I’ve received $79 from Spotify so far, and there’s no way a little indie artist like me had his songs streamed 273,000 times!
Glancing over my CD Baby accounting info, it appears to range from $0.0010-$0.0125 per stream.”
Hold on, there’s a range? In all the articles I’ve seen, there’s been no mention of a range. Now this commentor is talking about a range with a 1200% difference. Can we get any more misinformed than that? What I think he means is he’s been working with CD Baby for a while, and Spotify has grown during this time, which means their per stream value has gone up. But if you read that comment without any context, you could get very confused.
How to get your music on Spotify, and how much it pays
“For Spotify, the artist earns 0.02p per play. That means you’ll need 50 plays to earn 1p, 5,000 plays to earn £1, or half a million plays to earn £100. You’ll also get a percentage of advertising revenue, but we can safely assume that this will be even more negligible than play royalties.”
This article resulted in confusion in the comment section.
This was explained by Neil Goldman when he linked to this YouTube video. Nice job Neil!
There’s a million more articles posted recently about the per stream value of Spotify, as well as other music streaming services competing in the same space. I’m not sure how the controversy will end, but it's definitely going to be interesting to follow.