How Good is Spotify for Indie Musicians? (Not Good)(concertwindow.com)
concertwindow.com
How Good is Spotify for Indie Musicians? (Not Good)
http://concertwindow.com/6303/how-good-is-spotify-for-indie-musicians
11 comments
As I have posted elsewhere here, as a fact-on-the-ground 'discovery' is highly over-rated and over-emphasized. It is much easier to connect with 100 people deep enough to get them to come to a show than to connect with 1,000 or 10,000.
This idea that music should and can function like spam email doesn't actually work in the real world.
This idea that music should and can function like spam email doesn't actually work in the real world.
Agreed. Not to mention you can make some seriously sweet profits selling merch at shows ($25 T-shirts, $0.25 stickers, and every price point in between). If you want to pay the rent as a musician, you HAVE to do it by playing a lot of shows and drawing a bunch of fans with you.
speaking from experience
speaking from experience
Except Spotify isn't for discovery and virality. What your talking about is getting people to discover music. Usually done through blogs, social media, youtube. But when your talking about a service like spotify which is really a one dimensional store for storing, putting music on your mobile device that doesn't drive merch sales or concert tickets or even fans then they should be paying there fair share to artists. Granted maybe with FB open graph integration this is changing. And of course this isn't just a Spotify problem this is a label problem (of course now they're one and the same). Anyways the question isn't whether giving your music away for free or not is a good idea -- The question is why isn't Spotify doing what they say there are there to do?... Pay artists.
I disagree - I've been using Spotify for a couple of years to discover new music. The 'Related artists' panel, and then the 'Top Hits' easily lets you find similar bands/musicians and sample their most popular songs.
I'd prefer someone to discover a song of mine of Youtube, or read about me in a blog or a Twitter post, and spend the day streaming everything I've done - come to my show and singalong. Looking at listings for my local venue, I'll regularly spend the preceding days / week listening to who's coming to play before I go and see them live.
I'm aware my views differ from some, but we're in an age where you can pirate an album in 30 seconds. Those that are going to steal it, will. Similarly, those that want to pay, will. Until you have enough loyal fans/generic TV/radio coverage to buy your single on iTunes, why not just let them hear it wherever and ask them to donate or buy a t-shirt or vinyl?
Answering the question as to why Spotify isn't paying artists - the system may not be perfect at the minute, but it's certainly pushing the boundaries much better (and more legally) than anything previously. Which is a great, great thing, IMO.
I'd prefer someone to discover a song of mine of Youtube, or read about me in a blog or a Twitter post, and spend the day streaming everything I've done - come to my show and singalong. Looking at listings for my local venue, I'll regularly spend the preceding days / week listening to who's coming to play before I go and see them live.
I'm aware my views differ from some, but we're in an age where you can pirate an album in 30 seconds. Those that are going to steal it, will. Similarly, those that want to pay, will. Until you have enough loyal fans/generic TV/radio coverage to buy your single on iTunes, why not just let them hear it wherever and ask them to donate or buy a t-shirt or vinyl?
Answering the question as to why Spotify isn't paying artists - the system may not be perfect at the minute, but it's certainly pushing the boundaries much better (and more legally) than anything previously. Which is a great, great thing, IMO.
I'm a long-time Spotify user, and I have not bought a single piece of music (digital or CD) since I signed up, and I suspect I won't ever again.
Even if you offered me a free CD sent to my door, I wouldn't know what to do with it. I suspect the optical drive in my laptop is dead (I tried to burn a Linux install CD out of habit about a year ago, three in a row came out corrupted, then I discovered installing from USB-drives) and even if I'd get it ripped, I'd need to distribute it between my personal laptop, work desktop and phone (for living room listening). And dealing with backup.
Or, if you were on Spotify, I'd invest the time it takes to type in your name and give it a listen. If I enjoyed it, I'd probably buy a ticket to your show when your tour comes to London.
You're awfully concerned with getting your as-of-yet non-existent fans to cough up their cash rather than focusing on discoverability and betting on the long tail (I'm rudely making the assumption that Irish folk songs performed on accordion isn't going to displace Rihanna and Justin Beiber from the Top 40).
Even if you offered me a free CD sent to my door, I wouldn't know what to do with it. I suspect the optical drive in my laptop is dead (I tried to burn a Linux install CD out of habit about a year ago, three in a row came out corrupted, then I discovered installing from USB-drives) and even if I'd get it ripped, I'd need to distribute it between my personal laptop, work desktop and phone (for living room listening). And dealing with backup.
Or, if you were on Spotify, I'd invest the time it takes to type in your name and give it a listen. If I enjoyed it, I'd probably buy a ticket to your show when your tour comes to London.
You're awfully concerned with getting your as-of-yet non-existent fans to cough up their cash rather than focusing on discoverability and betting on the long tail (I'm rudely making the assumption that Irish folk songs performed on accordion isn't going to displace Rihanna and Justin Beiber from the Top 40).
I suppose for a musician, taking the leap of faith from cash-in-hand to maybe-cash-down-the-road is a big one. Even if ultimately it might pay off. It's a pretty fundamental transition between business models.
Edit: Also forgot to mention an important distinction in my point, which maybe wasn't clear enough: I will definitely put my music on Spotify eventually... just not at first, so I can capture a few sales that might otherwise have been lost to it.
Edit: Also forgot to mention an important distinction in my point, which maybe wasn't clear enough: I will definitely put my music on Spotify eventually... just not at first, so I can capture a few sales that might otherwise have been lost to it.
But you might have passed though London by the time I hear your music. Or I might read the review of your new CD in a newspaper and look you up, unsuccessfully. By the time you're there, I've long since forgotten you.
I'm not in the music business, so this is only based on readings and hear-say and should be taken with a massive grain of salt: Perhaps you'd be better off forgetting about making money off of your debut album. You can focus on getting maximum reach and energise your fans and then, if you don't make any money, it's not disappointing.
I'm not in the music business, so this is only based on readings and hear-say and should be taken with a massive grain of salt: Perhaps you'd be better off forgetting about making money off of your debut album. You can focus on getting maximum reach and energise your fans and then, if you don't make any money, it's not disappointing.
The long tail exists for the user. For the content provider it is a myth. The long tail rewards platforms that deliver the content, not those that participate in it.
An example from the world of books:
http://www.baekdal.com/opinion/the-myth-of-the-99-cent-book/
An example from the world of books:
http://www.baekdal.com/opinion/the-myth-of-the-99-cent-book/
The long tail exists, full stop. What doesn't exist is an entitlement to be successful in leveraging it towards a certain end.
I don't say anywhere that the full tail doesn't exist, do I? I simply point out that it's very lucrative for the platform provider and not very compelling for a content provider.
What counts is attention not access: there is no long tail of attention, full stop.
What counts is attention not access: there is no long tail of attention, full stop.
Perhaps you don't listen to CDs, but lots of people still do. My experience is that for performers on Dan's level, at least a third of their income from concerts comes from CD sales.
Of course, I've no idea how Spotify would affect that one way or the other. If most of those buyers bought the CD despite it being on Spotify, no harm done...
Of course, I've no idea how Spotify would affect that one way or the other. If most of those buyers bought the CD despite it being on Spotify, no harm done...
The vast majority of musicians can only support themselves via live performances. This was true before streaming services. It was true before the Internet. It's still true.
Radio stations pay (through a complicated scheme) royalties to songwriters. There are no performance royalties (whereas there are on Internet-streamed radio, which can be seen as a victory for radio broadcasting lobbying).
Major label artists typically earn nothing from music sales [1] due to RIAA accounting.
The parallel artists shouldn't be drawing isn't to the cost of purchasing a song or a CD but to radio royalties. If a radio station plays a song, how many people hear it? How much do they earn per listener? Unfortunately, that's really hard to answer.
Streaming services should be viewed as a means of discovery and curation. The bigger the audience you have the more you can make from live shows, which is your staple income unless you're the Rolling Stones, Sting, the Beatles, etc.
To focus on the <1 cent per stream figure is shortsighted. You should be letting as many people as possible listen to your music. There's a reason tech companies typically start by giving away their services: build an audience and you can scale. This applies to musicians.
Think about it: charging $5/head for 50 people at the local bar to listen to you takes you exactly the same amount of time as charging $50/person for 10,000+ people to listen to you in a large concert venue.
Sure not everyone is going to get so famous but I guarantee you this: if you don't get relatively well-known, your income from music sales in any form won't sustain you or even be that significant.
Radio stations pay (through a complicated scheme) royalties to songwriters. There are no performance royalties (whereas there are on Internet-streamed radio, which can be seen as a victory for radio broadcasting lobbying).
Major label artists typically earn nothing from music sales [1] due to RIAA accounting.
The parallel artists shouldn't be drawing isn't to the cost of purchasing a song or a CD but to radio royalties. If a radio station plays a song, how many people hear it? How much do they earn per listener? Unfortunately, that's really hard to answer.
Streaming services should be viewed as a means of discovery and curation. The bigger the audience you have the more you can make from live shows, which is your staple income unless you're the Rolling Stones, Sting, the Beatles, etc.
To focus on the <1 cent per stream figure is shortsighted. You should be letting as many people as possible listen to your music. There's a reason tech companies typically start by giving away their services: build an audience and you can scale. This applies to musicians.
Think about it: charging $5/head for 50 people at the local bar to listen to you takes you exactly the same amount of time as charging $50/person for 10,000+ people to listen to you in a large concert venue.
Sure not everyone is going to get so famous but I guarantee you this: if you don't get relatively well-known, your income from music sales in any form won't sustain you or even be that significant.
I like a lot of what you say in this - especially the last sentence. Out of curiosity, though, does anyone have numbers on the "spread the word" free model? I'd love to see some hard evidence (it that's even possible to collect) that it works.
A lot of people are essentially saying "focusing on album sales to the exclusion of free streaming is shortsighted" -- but how do we know that's true, aside from an intuitive gut reaction? Are tour revenues for Spotify artists increasing? Are more people going to gigs? There must be numbers somewhere.
I should also note that a large percentage of tour revenues are from album sales; I don't know to what extent Spotify is cannibalizing those. So it's true that tour revenue is probably the number one income source, but don't forget how important physical merch sales are on those tours.
A lot of people are essentially saying "focusing on album sales to the exclusion of free streaming is shortsighted" -- but how do we know that's true, aside from an intuitive gut reaction? Are tour revenues for Spotify artists increasing? Are more people going to gigs? There must be numbers somewhere.
I should also note that a large percentage of tour revenues are from album sales; I don't know to what extent Spotify is cannibalizing those. So it's true that tour revenue is probably the number one income source, but don't forget how important physical merch sales are on those tours.
Some facts on the ground here are just wrong - although the intuition feels correct: "The bigger the audience you have the more you can make from live shows, which is your staple income unless you're the Rolling Stones, Sting, the Beatles, etc."
As someone who has been in the business I can tell you that touring is very expensive and complicated - especially when you get into the middle-zone for a band where they want to tour regionally rather than just play out in their home town. Touring has become more competitive for bands and listeners-attention as well. Even for bands with small ambitions the amount of so-called 'fans' is often uselessly misleading because you can get a false sense of how committed a 'fan' is and how many true fans you actually have.
On the higher end, take an artist like Imogen Heap - who has a huge, cult following, has had some hits on the radio, won a Grammy, has a very lean production situation, and plays out by herself. That sounds like the perfect situation in the modern scenario - but she decided not to tour after her last Grammy-winning album because it was too expensive.
Touring does not in any way solve any of the problems of people not paying for music.
As far as streaming services being viewed as a means of discovery and creation - that benefit is for the listener and not the artist. There is a hugely compelling argument to be made that the enormous and chronic amount of choice actually prevents people from forming deeper relations to things.
To give one example, drawn from an Economist article maybe 5 months back - in a British supermarket shoppers were given a choice between a table with 6 jams to try or 25 jams to try. In either case, anyone who tried jams was given a coupon for the jam of their choice. Many more people stopped by the table with 25 jams, but the redemption rates were hugely different: 30% for the those who stopped by the table with 6 and 3% for those who stopped by the table with 25.
One can debate it many ways, but there can be no denying that the range of choice and access has fundamentally changed how a consumer relates to the possibilities in their environment. I deal directly with plenty of indie bands: exposure hardly matters because it does not equal attention. That's what boosters of the free-model don't appreciate. Things that people get for free are assigned less attention, less care than things they have to decide, and pay for, and own. That's the bitter truth. If you want a fan's attention, inspire them to pay for something - and not .30 for a download, but $10 for an album.
My counsel to young bands is to try and do just that - charge real money and make real product. Then at least you know where you stand. Chugging along on a illusion of fandom by getting people to 'like' you and stream your music for free is a lesson in futility.
Spotify is more like a search engine for music. It's a nice thing for the user, but truly meaningless for an artist. The new people making it big are doing so in spite of things like Spotify, not because of them - and that hardly makes Spotify qualifiy as an asset/savior in my book.
Think about it: 1 million spins on Spotify would gross you $2000 - which is a small budget to produce a truly professional single track. 20 million spins would throw off enough money to give you the budget [$40,000] that was granted to low-end rap acts in the late 90s for an album-length release - not counting promotion of any sort of course.
Consider that 20% of our mythical 20 million spins were actual iTunes dloads instead of Spotify listens. A band - even one on a major label - would earn well over $300,000 - and from a single track.
No matter how adroit the magical thinking the truth is the same as it has always been: sales = money.
As someone who has been in the business I can tell you that touring is very expensive and complicated - especially when you get into the middle-zone for a band where they want to tour regionally rather than just play out in their home town. Touring has become more competitive for bands and listeners-attention as well. Even for bands with small ambitions the amount of so-called 'fans' is often uselessly misleading because you can get a false sense of how committed a 'fan' is and how many true fans you actually have.
On the higher end, take an artist like Imogen Heap - who has a huge, cult following, has had some hits on the radio, won a Grammy, has a very lean production situation, and plays out by herself. That sounds like the perfect situation in the modern scenario - but she decided not to tour after her last Grammy-winning album because it was too expensive.
Touring does not in any way solve any of the problems of people not paying for music.
As far as streaming services being viewed as a means of discovery and creation - that benefit is for the listener and not the artist. There is a hugely compelling argument to be made that the enormous and chronic amount of choice actually prevents people from forming deeper relations to things.
To give one example, drawn from an Economist article maybe 5 months back - in a British supermarket shoppers were given a choice between a table with 6 jams to try or 25 jams to try. In either case, anyone who tried jams was given a coupon for the jam of their choice. Many more people stopped by the table with 25 jams, but the redemption rates were hugely different: 30% for the those who stopped by the table with 6 and 3% for those who stopped by the table with 25.
One can debate it many ways, but there can be no denying that the range of choice and access has fundamentally changed how a consumer relates to the possibilities in their environment. I deal directly with plenty of indie bands: exposure hardly matters because it does not equal attention. That's what boosters of the free-model don't appreciate. Things that people get for free are assigned less attention, less care than things they have to decide, and pay for, and own. That's the bitter truth. If you want a fan's attention, inspire them to pay for something - and not .30 for a download, but $10 for an album.
My counsel to young bands is to try and do just that - charge real money and make real product. Then at least you know where you stand. Chugging along on a illusion of fandom by getting people to 'like' you and stream your music for free is a lesson in futility.
Spotify is more like a search engine for music. It's a nice thing for the user, but truly meaningless for an artist. The new people making it big are doing so in spite of things like Spotify, not because of them - and that hardly makes Spotify qualifiy as an asset/savior in my book.
Think about it: 1 million spins on Spotify would gross you $2000 - which is a small budget to produce a truly professional single track. 20 million spins would throw off enough money to give you the budget [$40,000] that was granted to low-end rap acts in the late 90s for an album-length release - not counting promotion of any sort of course.
Consider that 20% of our mythical 20 million spins were actual iTunes dloads instead of Spotify listens. A band - even one on a major label - would earn well over $300,000 - and from a single track.
No matter how adroit the magical thinking the truth is the same as it has always been: sales = money.
I totally disagree about how music is devalued and I share Trent Reznor's belief that paying what you want devalues music, whereas giving it away doesn't. I'm going to give you a quote from him instead of explaining it because my opinion lies off of personal experience whereas his lies off of professional experience when he worked with Saul William.
"This is where you offer tracks or albums for a user-determined price. I hate this concept, and here's why. Some have argued that giving music away free devalues music. I disagree. Asking people what they think music is worth devalues music. Don't believe me? Write and record something you really believe is great and release it to the public as a "pay-what-you-think-it's-worth" model and then let's talk. Read a BB entry from a "fan" rationalizing why your whole album is worth 50 cents because he only likes 5 songs on it. Trust me on this one - you will be disappointed, disheartened and find yourself resenting a faction of your audience. This is your art! This is your life! It has a value and you the artist are not putting that power in the hands of the audience - doing so creates a dangerous perception issue. If the FEE you are charging is zero, you are not empowering the fan to say this is only worth an insultingly low monetary value. Don't be misled by Radiohead's In Rainbows stunt. That works one time for one band once - and you are not Radiohead." - Trent Reznor
http://forum.nin.com/bb/read.php?30,767183,767183#msg-767183 (Under update 3 in the first post)
"This is where you offer tracks or albums for a user-determined price. I hate this concept, and here's why. Some have argued that giving music away free devalues music. I disagree. Asking people what they think music is worth devalues music. Don't believe me? Write and record something you really believe is great and release it to the public as a "pay-what-you-think-it's-worth" model and then let's talk. Read a BB entry from a "fan" rationalizing why your whole album is worth 50 cents because he only likes 5 songs on it. Trust me on this one - you will be disappointed, disheartened and find yourself resenting a faction of your audience. This is your art! This is your life! It has a value and you the artist are not putting that power in the hands of the audience - doing so creates a dangerous perception issue. If the FEE you are charging is zero, you are not empowering the fan to say this is only worth an insultingly low monetary value. Don't be misled by Radiohead's In Rainbows stunt. That works one time for one band once - and you are not Radiohead." - Trent Reznor
http://forum.nin.com/bb/read.php?30,767183,767183#msg-767183 (Under update 3 in the first post)
Here's a freebie for Spotify and Rdio: Allow artists to sell their merch from your app/website. It would engender a ton of good will from artists. It might even help your margins (which I imagine can't be too huge) too.
If they don't do that, there's a startup idea for someone.
If they don't do that, there's a startup idea for someone.
I haven't used this product so perhaps I am misunderstanding the article. It seems to confuse sales royalties and streaming fees. Streaming fees are 1 cent for big names and 2/10 cent for small names, is that it? And sales commissions for outright downloaded sales are not specified. But then $1 "per stream" is suddenly brought up in the last sentence without explanation. $1 per track download or sale is somewhat industry standard, with iTunes' 99 cent tracks. But $1 per stream or single listening is not normal at all. The two seem to be very different things, downloads and single plays. To me, the article seemed to confuse them.
sorry, the $1 per stream is referring to Concert Window's royalty to artists (the artists get $1 per webcast ticket sold). Then as for Spotify, which is separate, I had originally thought that Spotify paid 1 cent to the artist/record label per stream, but in actuality it's a little under $0.002.
BTW, we've been enjoying the free webcasts from Passim (lots of Matt & Shannon!), and my wife went crazy and started talking about subscribing when she read the Concert Window upcoming schedule. It's a great service for those of us far away from those clubs.
(PS once I hit the "download free track" on your webpage, none of the links on the left hand side worked any more.)
(PS once I hit the "download free track" on your webpage, none of the links on the left hand side worked any more.)
When I hear a good indie band, I try to buy something from them. I don't care what it is... a tshirt, a cd (even though I never play it), a beer cuzy, whatever. Today I can only do that at a live show. I wish someone would make it easier for me to give my money to bands I like.
Ridiculously short sighted analysis. So you sell 143 CDs and make your thousand bucks. Good for you. End of the road. Then you sell another 155 CDs on CD Baby. Make another thousand bucks. Yep. End of the road.
In the time that it's taken to sell 298 CDs, and effectively reach 300 people, you're telling me you wouldn't (for free) make the music available to thousands of users and then just share the hell out of it? How much music gets streamed by Spotify users just looking to try a track out? That too counts as revenue.
If it were me, I'd distribute across as many channels as quickly as possible and hope that I catch on as opposed to "burning out" each channel one by one in the most painfully slow marketing campaign ever.
In the time that it's taken to sell 298 CDs, and effectively reach 300 people, you're telling me you wouldn't (for free) make the music available to thousands of users and then just share the hell out of it? How much music gets streamed by Spotify users just looking to try a track out? That too counts as revenue.
If it were me, I'd distribute across as many channels as quickly as possible and hope that I catch on as opposed to "burning out" each channel one by one in the most painfully slow marketing campaign ever.
Well, a lot of new media companies, including Grooveshark, have made exactly that argument. It might work for larger artists with a built-in fanbase, which makes virality easier to achieve since it'll start with some sharing momentum. But for indie artists with very small fanbases (I'm talking hundreds of fans, not thousands), having your music available for free doesn't do as much for you. The fans who would have bought your album will now listen for free and not buy it, and nobody else has heard of you. Plus, explosive virality will be harder to achieve - in general - with such a small number of people to begin with.
Again, I'm sure Spotify pays out a significant amount to the record labels and major artists, but I'm talking here solely from the perspective of a small indie musician with a, say, 200 person fanbase. In that case I don't think your argument makes sense.
Again, I'm sure Spotify pays out a significant amount to the record labels and major artists, but I'm talking here solely from the perspective of a small indie musician with a, say, 200 person fanbase. In that case I don't think your argument makes sense.
Why can't you do both?
The people who are finding your sell pressed CDs would probably buy it whether it was on Spotify or not. If those initial buyers then wanted to share the music with somebody else, I would think Spotify would be a MUCH preferred option compared to ripping the CD and sharing it on a torrent site.
As an indie musician, your goal shouldn't be to milk as much money as you can from your 200 person fanbase, right? It should be to double and triple that fanbase. Self pressed CDs seems to be one of the slower, more painful ways of doing that.
The people who are finding your sell pressed CDs would probably buy it whether it was on Spotify or not. If those initial buyers then wanted to share the music with somebody else, I would think Spotify would be a MUCH preferred option compared to ripping the CD and sharing it on a torrent site.
As an indie musician, your goal shouldn't be to milk as much money as you can from your 200 person fanbase, right? It should be to double and triple that fanbase. Self pressed CDs seems to be one of the slower, more painful ways of doing that.
Even Coldplay just announced last week that their new album would not be on Spotify. They released it this week, it went to #1 by a landslide and a huge % of it was in digital sales. If it were available on Spotify, you can only imagine that's not what would have happened.
Good point. I'm curious to see if there's more of this from major bands. I love Spotify, but as a musician, it does make sense to capture all the sales you can at first, and then open up your album for free streaming later. Some fans will do whatever it takes to hear an album when it's released, and if you give them a free option upon release, you're losing those sales.
It is a ridiculously short sighted analysis but the point is that the thousand bucks you cited is likely to be a fraction of that if anyone can go listen to the album whenever they want for free. There are plenty of ways to market your music without making it pointless for anyone to purchase it.
I don't want this sound like yet another anti-label rant but as I see it, this is mostly a chicken-egg problem caused by the big labels, that are unlikely to be charging Spotify the same fee per stream but rather a flat fee that is so high that Spotify is still at loss and can't afford paying more to smaller players. I'd imagine if more artists went independent, things could be better both for them and Spotify.
I think there was a graph here on HN a while back on the number of CDs/mp3/streams it would take for an artist to make a certain threshold of income.
If anyone could find that, it would be really helpful in conjunction with this article.
If anyone could find that, it would be really helpful in conjunction with this article.
I don't know if this is it, but it's very similar:
http://www.informationisbeautiful.net/2010/how-much-do-music...
Linked from the OP
Linked from the OP
+1 - That's it. Good find.
Some quick math: One million (1,000,000) streams comes out to $2,000 for the artist.
Helps give perspective to the artist's deal in numbers we can actually comprehend.
Helps give perspective to the artist's deal in numbers we can actually comprehend.
This is why we have things like Bandcamp and Tunecore
When I had the numbers, I'd deal with the money. Long and short, I'd rather have 10 thousand people listen to my record and talk/blog/tweet about me / come to shows, than 100 people buy it and 10 people come to my show.