Thanks for the rant against the anti-streaming royalty whiners.
The problem is people hear the word “million” associated with their stream counts and think that it should equal lots of $. Then they look at the imputed per stream rate and think it’s pathetic. The facts are:
DSPs pay 50-70% of their gross revenues to the royalty pool (more than 10x radio).
Successful records earn beaucoup bucks from streaming
Complainers are either not popular, or have deals with a label or publisher that is either still recouping the advance or is an old school deal taking most of the pie.
It’s useful to think of each stream as an “impression”, and compare it to radio “impressions” and royalties. Since US radio doesn’t pay master royalties, keep it to publishing only. Take a typical audience for a major market pop station, and one spin is equal to 1x that audience in impressions. Take what BMI/ASCAPSESAC/GMR pay per spin, and divide by the audience size. You get an amount per radio impression that is not light years away from the publishing part of the per stream rate. To get a million impressions on radio you might need somewhere around 10-100 spins depending on the size of the station. Nobody would think they are successful or expect large royalty checks if they only had that many spins at US radio. Big records have hundreds of millions or billions of streams and radio impressions. The radio and streaming royalties generated by a world-wide hit are significant and I don’t hear people attached to these hits complaining. It’s a hit driven business. Always has been, always will be.
The real injustice in streaming is the 4 or 5:1 ratio of the value of the master vs publishing. That’s a travesty and hopefully unsustainable. There is no fundamental legal or economic reason why it shouldn’t be 1:1, it’s just the result of an historic industry power imbalance favoring the record labels.
Best,
M
Michael McCarty
CEO
Kilometre Music Group
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The music business doesn’t exist anymore? Nobody is getting paid? Really? How many times do we have to hear this? It reminds me of the election being stolen. Say it enough times and people believe it. Streaming royalty payments vary according to the arrangements artists have with their labels and distributors, not with the streaming services. Pretty simple. Blame your team, not the streaming services.
Bob Anderson
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I cannot fu*king believe this guy is still at it. This is simple, DSPs payout a little less than 70% of revenue to rights holders (approximately 54% is paid on the master, and around 14% on pub side). Therefore, we have just 2 ways for rights holders to receive more money: claim more than 70% of the overall revenue, or force DSPs to raise what they charge customers monthly. That's it! This is the entirety of the debate.
To me, companies retaining 30% to pay for technology / UX development and upkeep, servers, employee compensation, office/building rent, health insurance, taxes, etc etc seems fair. But I certainly can understand a debate on that.
He doesn't seem like a dumbass, I guess he's a liar.
Peter Wiley
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Everyone keeps blaming Spotify for an existential problem in the music industry. There’s too much supply and not enough demand. Musicians used to make money from royalties when record sales were driven by listener demand. Nowadays, there’s so much music and listeners don’t want more.
Indie musicians made the mistake of believing that if they released enough product, they could stand out in a crowded marketplace. One song a month. One song a week. But since everyone is doing it, the effects are minimal.
Streaming is like an advertisement for your project. Not an income source. We’re entering an era where streaming is the result of demand, not the driver of it. Playlists used to be a ticket to a larger audience on Spotify. Not anymore. Now you have to build your own audience, build your own fanbase, play shows, build community, and make people give a sh*t before they’ll even think about streaming your songs. Streaming is for the fan’s convenience, not your pocketbook.
The pinch artists are feeling is amplified because many of us were supplementing streaming income with sync placements and brand deals. But when TV production stopped and advertising budgets have been cut, so did the payouts.
Music is no longer “culture.” It’s not interesting enough on its own to move the needle. The future is in the niches, not the mainstream.
Nicholas Roberts
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Hi Bob,
I couldn't stop giggling at this. A few months ago I did a couple podcast episodes on this; my grievances are almost identical to yours. I referenced Damon (he is among the "indie music guru bros" I mention), because I found his articles and tweets on the topic infuriating, as someone who works in music. My artist friends were starting to discuss streaming as if they knew what they were talking about because they read his pieces.
I knew I would get called a bootlicker for saying "artists aren't entitled to royalties", and I did at first. I'd rather be called a very inaccurate insult from people with zero dogs in the fight and be right than be Damon right now.
It's validating to know that an industry "vet" agrees with me. And you're right, it's hard to get people to listen. There's so much noise, and most people who work in the industry don't even know enough to know that Damon was wrong. Concerning, to say the least.
If you'd like to listen to the next generation sh*t talker:
open.spotify.com/episode/0STQSygEyaIttx49S9tEMK?si=52f449abf3ab4a41 Take care
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Bob, I’m with you on this but I think there’s another way to think about it. Before mass media, most musicians made their living by singing for their supper. it’s the illusion of possibility that causes everybody with a stream on Spotify to think they are entitled to more.
When you stood on a corner or sang in the local bar you made a couple of bucks in tips and felt good about it. With Spotify it feels like you’re standing on the World stage right next to Taylor Swift and somehow it doesn’t seem right you’re only making a dollar.
Oh well,
Andy Romanoff
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Nobody is entitled to make a living from music.
First, find your audience.
Nobody who signed a deal 30 years ago should expect to be still making a living from their recordings in 2024.
But because streaming makes their music available again, they complain about streaming rates.
Well: first, find your audience.
Again.
Just like when you did the club and bar circuit back in the day, today’s recording artists find their audience online. And they work hard at it.
And if they get the numbers, they get the streams.
Doesn’t matter about the music. Could all those bubblegum pop acts from the 70s play a diminished chord, or solo like Hendrix?
Success is about communication with an audience.
First, find your audience.
It’s really very simple. I’m 75 years of age, and I’m looking forward, not backward.
Best wishes
Paul Phillips
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Complaining about streaming payments is just someone telling on themselves. They're admitting publicly that they don't have enough of an audience to make decent money from streaming their music and/or are lashing out because they were foolish enough to quit their day job without having enough income streams to not starve. I imagine for most of us, streaming money is funny money, it's not something you're going to be paying your bills with unless you're at or near the top of the pyramid and it's wild to me that more people don't realize this.
Adam James Deiboldt
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I get the point.
I DJ, and I ask myself how can I get paid like the big time DJs.
It's about demand.
If I can't create the demand for people to see me, I can't command high fees.
How do I create the demand?
Make music that people want to hear.
Even if I can out-spin someone, it doesn't mean that I deserve more money.
But if they are less skilled as a DJ, but out-demand me and sell out a show, they deserve the money they ask for.
It took me a long time to understand this point.
Shammy Dee | Event & Luxury DJ
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EXACTLY... No one knows the history well enough... nor do they adjust well to the ever changing paradigms (that's understandable)... but, bands like G500 can make $ via the never-say-die vinyl boom and do hip in-store unplugged gigs at the shops and do sporadic touring/shows-- MANY bands don't even have that luxury...
Patrick Pierson
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Seems to me that many ‘artists’ are longing for the old days and past royalty rate payments that have never actually existed…
Interesting…
Mick Dalla-Vee
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Spot on, Bob. What world is that cat living in?
In the 90s I toured with and did session work for some name acts, then started writing for TV & film in the early 2000’s, after the musician’s union wiped out all of our pensions with bad investments. The 2008 recession cost me 70% of my composing business in 18 months. I also released a niche album of my work in 2010.
Flash forward to now, and film/TV works that I created in my early career are still paying me in performance and mechanical royalties; and that album somehow caught on 10 years after its release and has over 2 million Spotify plays. But it’s rolls of nickels & dimes, not Benjamins that I can count on. It’s asinine to think that you can survive on anything but playing live at this point, since it’s the last price point musicians can actually control(!)
I’m grateful for even the minor success I’ve had, and don’t understand how anyone who’s done even a little bit of research can’t get this through their head: it’s. up. to. you. Create something people want; learn about and register your works with PROs, The MLC, Sound Exchange; play live gigs; have merch. Repeat. But most people won’t succeed, something that sobers me when I (weekly) hear something fantastic and it hasn’t ever gotten traction for whatever reason(s). Sad, but it has always been - and always will be - true.
- Scott
Scott W. Hallgren
composer / conductor / sound editor
Scootman Music Productions
__________________________________________
While I'm not a musician, I'm a writer that has self-published my own work to some modest success, and I wanted to give you a perspective from where I sit.
Anyone who is creative and hopes to make a living off of being creative needs to know that it's a long road, and that (at least for writers like me) it's nearly impossible to live off of royalties alone. I hold down a day job. When there's so many things people can choose to read, watch, or listen to, just getting others to know you exist is a challenge in itself. The sooner one accepts that, the better off they'll be.
My writing is academic. I think the reason why I've been able to attract eyeballs to my work is because I did the opposite of what a lot of academic publishers do. They'll charge anywhere from $75 to $125 and up for a book. But I had to be realistic. Nobody knows who I am; who the hell am I to ask people to pay that much for a copy of my work? So I dropped the price. Initially, I charged $25, but had to raise the price recently due to increased printing costs (the agreement I have stipulates that the printing cost has to be covered in the list price). And I made the e-book price lower, and kept it there. The result is that readers have checked out and purchased the work - they've decided the price is reasonable. I guarantee that had I stuck to the old model I wouldn't have had the sales I have.
Granted, the royalties are small, but what's more important is that people are reading the book. And as a writer, that's what you want. For academic works, selling 500 to 750 copies of a work is considered quite successful; it is very rare that an academic book will sell hundreds of thousands of copies. I'm not quite at the 500-750 copy mark yet, but it's getting there. So my advice to creatives would be to do the best work you can, don't be afraid to be unconventional, and to temper your expectations.
Take care,
Wes R. Benash
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I found this interesting because Damon/Naomi and Galaxie 500 frontman Dean Wareham had a falling out after Dean quit the band in 1991 due to creative differences, and Dean went on to form the band Luna. Neither band is successful based on streaming metrics, Luna's biggest spotify song is ~6m. But both have avid cult followings in the vein of The Feelies, Big Star and Guided by Voices which you will find ample evidence of in online searches. Dean has been prolific throughout his career and I assume has made a nice living of it, my sister just saw Luna play in Chicago two weekends ago. Discovering Luna first in my early 20's and then going backward to Galaxie 500, i always found Dean to be the creative talent for both bands, as even though all members of each band get songwriting credits, the consistency and volume of good (great to me) songs he has been a part of in his long career prove that out. Not so much for Damon. And to the longwinded point, tellingly Dean begins his memoir with a sour grapes filled quote from Damon about Dean asserting control of the band behind their backs and having a spotlight on just him at a show for the first time. Perhaps Damon has always felt underappreciated.
Chan Dillon
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Bob,
I wonder how many musicians who insist that Spotify is screwing them out of a rich and famous lifestyle pay for 100% of their software, recording and otherwise? And even if they do, how much of that software runs on the back of countless open source projects whose creators both have never been, nor ever will be, compensated even a single penny?
They'll say, "oh, I have no idea. I don't understand that stuff! Why weren't they paid? That doesn't seem fair!", and truthfully, some open source developers have figured out how to get paid, but those are brilliant, diligent people who stand out from the pack. Most of the rest do it out of ideology, optimism, because they want to, they need to, they can't stop thinking about the project until they bring it to life. And they give it away to the world for free, because it needs to exist.
Every single piece of software that these complainers touch has an extremely high probability that it only functions because of the thankless millions of hours, blood, sweat and tears poured into a void that practically nobody will ever see, let alone acknowledge, compensate or praise. Every website they visit, every app they're addicted to, their inner workings stand on the shoulders of giants come before them, and the coders aren't getting paid.
Frankly, why should they be entitled by default just because they made something?
And who would pay them?
Software companies who industrialize free software into a product and charge for access?
You? Me? The government? What about Elon Musk? He's got a lot of money, maybe he can pay me because I made something!
Gregory Coleman of The Winstons never got paid for his iconic drum break that literally birthed entire genres like jungle and drum & bass.
H.P. Lovecraft never got paid and was dead in the ground before his groundbreaking contributions to horror / sci-fi were recognized, reprinted, reworked, and revered.
Hell, Jean-Baptiste Joseph Fourier died in 1830(!), and without his contributions to math and physics, there would be no signal processing, no sound cards, no digital music, no Napster, no iTunes, and certainly no Spotify.
Without that guy and scores of geniuses building upon his work, these dorks wouldn't even have the -opportunity- to get paid their point-zero-zero-nine cents per stream!
I just don't get the entitlement.
"I'm not paying for your fu*king software! I'll steal it if I have to, and I'll make music and art with it, and by the way I'm SPECIAL too, so if I don't get rich and famous it's Spotify's fault, not because I made music nobody wants to listen to!"
Huh??
-Kevin Kaiser
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Sup Bob
Your only pal who owns a bus company here.
I sent you my song a bit ago. As you didn’t publish the link in your mailbag, I blame you for its measly 400 streams :)
I kid
I was actually super stoked when I got a royalty check from Spotify. It was for $2.
I’m totally serious and that’s not a number I pulled out of my ass. Real data from the trenches.
I don’t expect to make a living as a musician. I don’t expect to make it leasing buses out to bands I care about. I don’t want to sound like a Republican either.
I own my song.
I honestly uploaded it to see if I could figure out how to navigate the backend of Distrokid. The total strategy was to text the link to friends and post it on my little instagram page. 400 listens, hardly a blip. But a $2 royalty was, I think, amazing.
I knew I was putting no strategy into it. No marketing, I’m not working the algorithm.
All while driving bands, running a business.
Which one is my “side hustle”? Neither. I want to win at both.
I’m a lifer for music because it makes life worth living.
$2 for 400 people listening to my song is quite amazing.
That means if 4000 people listen it’s $20
40,000-$200 and so on
I think the thing that people are bitching about is just life.
Would you rather make $200 writing and recording a song? Or driving 8 hours?
I do both
So, thanks for your perspective Bob.
Here’s the video I paid a friend to make. It has 227 views after a week. If you post it in your mailbag, I’ll split the royalties with ya.
And I’ll still drive you on the podcast tour
"I Am A Robot by The Cle Elum":
www.youtube.com/watch?v=WG1v_zwMXe0&list=PLCloigebw3zp6e7W1sOa73PdvNFhED6cz&index=1 Best
Ian Lee
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My son is a 16y old professional musician (a Broadway run, national tour, Pro Tools certification, and loan-out LLC under his belt), and you'd be appalled at the disconnect in his "music business" courses. He gets it, is graduating 1y early (can't wait to get out of HS), and would be laughing listening to Damon & Naomi... "WTF is this $h!t, can't sing, barely plays chords, putting me to sleep....!"
Streaming is not rocket science, my 16y old gets it quite easily.
David B. Weiss
__________________________________________
This guy was my TA in junior year English class!
Jim McCarthy
__________________________________________
We used to publish him at Bug Music- not a big earner and that was a long time ago.
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