Sorry, but this is inaccurate. The IFPI report says Spotify is the second largest source of DIGITAL revenue. (Itunes is number 1.) Big difference. Digital revenue is about 20% of total revenue for European labels.
As the writer of the article, I want to apologise for that inaccuracy. I have added this clarification to the article itself and mentioned of this in the end. The mistake was completely unintentional.
However, it would be interesting to research if there are single entities larger than iTunes or Spotify selling "analogue" music on a European level - which could hold the initial statement true.
Spotify cannot be compared to iTunes and amazon, or traditional CD sales. It is more equivalent to royalties from FM radio play. Lots of people don't seem to get this.
The smart musicians realise they can do things like put their album on there for the month before the release, leave it on there for the month after its release, then yank it away and watch the MP3 sales climb. I see this quite a lot.
Planet Mu records in particular seem to have a subset of their extensive back catalogue on there that is constantly in rotation. This practice has basically forced me to buy music from them on more than one occasion. It's like the mythical practice of drug dealers giving kids free samples to get them hooked :)
> Spotify cannot be compared to iTunes and amazon, or traditional CD sales. It is more equivalent to royalties from FM radio play.
Well, that sounds like a strange simile to me. When listening to FM radio you do not chose what tracks you listen to. Spotify isn't Pandora. With Spotify, you can chose whatever track you like (as long they have it and there's no commercial queued). Lady Gaga got $167 for 1 million plays. Imagine what the small artists receives.
Spotify is controlled by the four major record companies: Universal, EMI, Sony and Warner. Even if they just own 18% of the shares, Spotify's entire existence rests on the trust that these record companies continue to license "their" music. The four record companies are using the power of Spotify to further strengthen its domination over other record companies and penalize artists outside their own team.
To me, listening to Spotify and actually believing you are doing something better for the artist than those who pirate is no less than delusion.
listening to Spotify and actually believing you are doing something better for the artist than those who pirate is no less than delusion.
That’s sad to hear, and I hope it gets fixed, but
But
I didn't sign up for Spotify in order to "do something for teh starving artists" I, and the people I know who signed up for it, did so because
1) it's legal
2) it's cheap
3) It gives instant access to a wealth of music beyond what I could ever listen to in my whole life. It’s not every song ever (for instance there’s no Frank Zappa, no Coil, and the cusswords in Cake’s songs are blipped out) but it's close.
The artists were starving when the major labels were ripping them off, the artists are starving now their songs get copied and torented. It’s sad that Spotify doesn’t solve that problem, and that it doesn’t cure cancer either, but hey, at least Spotify didn’t make things worse.
Spotify’s competition is yes, illegal downloads. Illegal downloads have the advantage in price - they’re free, but they lose out to Spotify in not being legal and being less searchable.
The "instant music" really is a distinguishing feature. e.g. Gary Moore dies -> Play some of his music on Spotify. Friend says he’s been digging a band called "Aesthetic perfection" -> Listen to them all afternoon on Spotify. As ever, casual listening, if the artist gets paid or not is a gateway to finding new music that you really like, leading to being a fan and buying CDs/MP3s, gig tickets and merchandise.
I use Spotify too. I'm a user from back in the days when they shared their friends music libraries. I kind of like Spotify, but I think it is important not to see any of these services as the be-all and end-all of digital music distribution solutions.
That is exactly how Spotify is presented here in Sweden. While Spotify is losing money, the politicians brag and tell us how they suddenly found the "cure" for illegal filesharing.
We have to be realistic and not place all our bets on one horse. There is no single solution to media on internet and Spotify is no different. The internets = multitude. And, therein lies the beauty.
The Lady Gaga figure is not relevant. It was for the first months of public Spotify, before they had any real revenue. Since the payout is revenue based and not fixed (at least as far as I've heard), the level of revenue impacts the payouts a lot. Also, AFAIK, no official figures are released for how much any artist gets from Spotify currently.
I've seen this happen on occasion and it's the one thing that really pisses me off about Spotify. I expect music that's in my playlists to actually be there when I want to play it. I pay for it, it's legal and it earns the labels more than the thousands of people who use Pirate Bay. When they yank the music I listen to, away from Spotify it makes me want to fire up my BitTorrent-client again.
Of course it can! The fact that it is on-demand practically negates the need to buy the music else where. On radio you have to sit around waiting for your song to come on. I've seen royalty reports from Spotify's largest artists, and it was indeed microscopically small.
As you might now The Pirate Bay and piracy have been huge in Sweden. Spotify have changed that when it comes to music. By making it _easier_ to listen to music via their application than via bittorrent/kazaa/napster/dc++ downloading, they're now the most used music player in Sweden. Just a few years ago the Pirate Bay top 100 list was full of music. Now there's two (2!) music albums on it, the rest is tv-series and movies.
If you look at it that way, that piracy is the competitor not cd sales, the music industry has a great opportunity in Spotify in the long run.
100% correct, at least as it pertains to me. The concept of "owning" music has been dead to my generation since Napster. I'm not even sure what that concept means, nowadays. Music is like water, you can get it from a million sources, paid or not. Getting it isn't the problem.
My real problem is finding what I want to listen to at this very moment, and managing it. I don't want to spend forever finding my music, downloading it, arranging payment, organizing it, backing it up, copying it to my iPod or other computer, etc.
Spotify gets this: search -> listen -> add to playlists. At work, home, wherever... just login. Girlfriend's music? Switch user. Throw away my iPod, it was just a shipping container, anyway.
Actually, you don't even need to switch users to listen to your girlfriends music. The social layer they've integrated via Facebook makes it possible for you to listen to her playlists as well, from your account ;) #win
I heard a talk by Andreas Ehn (Spotify's former CTO) last year and he actually mentioned in his talk that piracy was the benchmark they were trying to compete with Spotify.
Piracy still is the market leader in catalogue size and ease of use for consumers at large (just see the AVC post in another comment). This is actually a fantastic way to look at it - Spotify didn't set out to beat iTunes or any existing market player with a business model, they wanted to beat piracy.
Now that's an ambitious goal, even though many other services aim at doing the same indirectly (by beating existing market players).
The main reason music is gone from TBP is because everyone knows RIAA is watching the peers on public trackers like mofos.
Serious pirates are all on small, private trackers with exclusivity, speed, and quality as the main guidelines. You can't just join them either, most require relatively decent speeds tests, high ratios for seeding/sharing and have closed registrations, only invitations. Seedboxes are all the rage, and the hardcore pirates are probably using Usenet quite a bit now as well.
Here's the thing with Spotify: The major four all own a share of the company (around 4-6%, if I'm not mistaken). For them to be willing to license their music, they negotiated a sweet deal: They get a lot more per play than indie artists (or artists on labels not on the major four).
So, if you're a Spotify customer, paying 100 SEK ($15)/month and listening exclusively to, say, Santigold, most of the loot will still end up in the big four's pockets.
Maybe that's what your read, but you could also read that Lady Gaga has more income from iTunes just because more copies were sold there. And ofcourse this has nothing to do with Spotify. They just have a contract with the labels. How labels distribute income is up to the labels.
I'd be more interested to see how much an album will make in an artist's lifetime. Traditionally, you buy the album once. With Spotify, money changes hands whenever a track is played, on an ongoing basis.
Just to clarify it's not just mobile streaming, but offline mobile support. I carry around 1500 tracks on my Android using Spotify Premium for £10 / month. The transparent wifi syncing and social aspects of the service (collaborative playlists, music inbox etc) are awesome too. If it's available in your country, I urge you to try it.
That is most likely due to GEMA (the german collection agency) having very high fees for internet streaming. Same problem in Denmark with their collection agency.
Exactly. GEMA charges a minimum of €0.1916 ($0.2626) for each streaming of a song up to five minutes. Compare that to the £0.0022 ($0.0035) charged by PRS for Music, the equivalent performing rights collection society in the United Kingdom.
