Streaming revenue (Spotify etc)

I have seen some petitions online the last days where artists “demand” 1 cent per stream on Spotify. As a composer, of course I would love that. But is that realistic?

I mean, from my understanding Spotify is paying out something like 65% of their revenue. Right now I checked and they paid out: $0,0032 per stream. That would mean that even if they gave away every single cent they earned (which is impossible to run a company with zero income)…even then it would not be 1 cent per stream in payouts.

Am I missing something here, or is this just artists “wanting” something without realizing how it all works?

Those who demand mostly seems to be musicians who has been in the game since 80’s/90’s. At least what I’ve seen locally here. I don’t know how long it’ll take for them to realize that the business has changed and changes all the time. For modern musician Spotify is only one of the many sources of possible income. I would like to ask from them that can they actually name one business that works now exactly the same as 30 years ago.

I know it would be nice to do record only when the inspiration hits and then do tours and gigs between. It’s still possible but not for as many artist/bands as before. Game has changed, it has changed in every business. Learn the new ways and adapt and if you don’t like how the business works nowadays, pick a better one.

1 cent per stream is well… everyone can do the math if they will. Feels like it’s the same tactic that labour parties uses here in Finland when they’re trying to negotiate pay rises from the companies. Ask an absurd raise and settle for anything. I’m not saying here that the current amount is completely fine but unless we can get our hands on the whole financials and business model of Spotify no one can really say how much the amount could be raised.

These are just my 2 cents on the topic and my opinions mostly based on discussions happened here in Finland.

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I agree, Spotify and streaming is here to stay. And the market decides what music is worth. If people start to question the free market and make demands not based on facts or reality, well then, the free society is at risk.

I think streaming income is one of the most misunderstood systems in the mainstream music industry. It is actually difficult to clearly and simply explain why you get $0.0032 per stream.

The hypothetical that always strikes me is this: If everyone continued to pay their subscription, which (after Spotify’s cut is taken) added up to $1 million, but only ONE of those subscribers played ONE song: Rebecca Black - Friday. The result would be that Rebecca Black - Friday would receive $1 million in streaming income for that single play in that month. That’s right - everyone who hates Rebecca Black and never dreams of playing her songs, their entire subscription money was sent to Rebecca Black, that is actually part of the deal of your subscription money in this case.

It is all proportional to the total pool of money received by Spotify divided evenly amongst plays that users in your region choose to play. This gets a little more convoluted with the sub-tier and ad-supported-tier, but you get the point haha.

I get that musicians feel bad about their plays being ‘valued’ so low. That hurts, but if you are to work in the music industry you have to understand a LOT of weird valuing going on, the financial systems are very different to that of a day job. You have to be careful about comparing your income in that way. If you are worried about the low income per play, remember increasing your fanbase and plays are key.

I get that music has value problems, and we should work on that! Find ways to remind people of the financial worth of music, absolutely - let’s not stop doing that.

Also we need to understand that asking for 1 cent per stream… maybe ask a little differently. Ask Spotify to take a smaller cut, Ask subscribers to value Spotify monthly sub at $20/month instead of $15/month. Those sorts of things are real requests that you can play with and see how it feels, learn something from it. They will increase money per stream if they pass, but you have to specifically ask someone to give more money and for them to say yes. So it is a big music value story there to play with, which is an age old problem which we can all work and struggle to keep it healthy best we can.

Most importantly also move on and keep making some damn music, get better at making music and marketing yourself!