The labels effectively owned the rights to their songs and took most of the revenue from sales of recorded music, live performances, and publishing for themselves.
For decades, artists were dependent on record labels for success.
Amazon Music Unlimited has also entered the streaming market with around 55 million users in 2020.įor all the criticism of Spotify, it's possible that it and other streaming services could be the best thing to happen to artists in a long time.
You can read all about that in the article, "How an indie artist earned $56k from one song on Spotify (an interview with Perrin Lamb)."Īpple Music is also growing fast with more than 70 million subscribers. Hundreds of thousands of plays turned into millions." But, once it found its way onto the playlist… boom. The song had been out a year and hadn’t really done anything to that point. "Then, in January of 2014, a song of his called “Everyone’s Got Something” was put on the Your Favorite Coffeehouse playlist on Spotify by their editorial team. This may give you some idea of why many artists have issues with Spotify. YouTube accounts for 21.7% of streams but only 3.81% of revenue. However Spotify wasn't even close to being the worst. Rhapsody (now called Napster) is even more generous accounting for 0.52% of streams but 2.52% of revenue. Tidal had 0.1% of streams while providing 0.33% of revenue. Google Play Music (now YouTube Music) made up 2.36% of streams but 4.03% of revenue. It doesn't look so good in comparison to some other providers though. Spotify is responsible for about 63% of all music streams but 70% of revenue. Spotify made up 62.97% of streams and 69.57% of revenue.* On the surface, this doesn't look too bad. They looked at the percentage of streams from a particular provider and then what that translated to in terms of revenue. The Trichordist did a comparison of various streaming services. The indie labels and acts end up with a lower payout rate but without the benefit of licensing on top of it. One reason the major labels can get by with a lower payout per stream is because they also get paid from the licensing. Spotify also pays to license the music of major label artists, something they don't do for indies. Major record labels own stock in Spotify and can profit from that. The system in place puts indie labels and artists at a disadvantage.
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