Money for Nothing?
AFTER listening to an interview this morning…
on BBC Radio 6 Music with the producer Jonathan Taplin; it got me thinking about some of the points he raised. Namely, the one that stuck in the mind concerned digital music and revenue for new artists. We all hear of those ‘YouTube stars’ who can, if they have enough subscribers and sponsors, amass a small fortune over the course of a year. It makes the banal and mind-numbing nature of ‘normal’ jobs seem rather pointless. If one can set up a channel and make that sort of money, why bother doing what you do?! Whilst it is tempting to ditch the nine-five routine and surrender to something quite glamorous and glitzy – does that guarantee you will make a lot of money?! The short answer is: no.
Those elite YouTube artists are successful because of their brand and what they do. A lot of the biggest names are beauty correspondents and do lifestyle videos. There is a limited market, from a profitability standpoint, for those who concentrate on music and recording. If you are an artist thinking about making your money that way, you might be in for a long wait – the profit might be two-figured rather than six-figure, perhaps. That talk with Taplin on ‘6 Music – conducted by Shaun Keaveny – was illuminating and eye-opening. We often assume sites like YouTube and Spotify pay artists big money for a certain amount of streams but how accurate is that?
Reading a couple of articles and it seems one-billion streams equates to around $870-million.
That is a rough figure but they say you get one dollar per one-thousand views. We can quibble here and there and round figures up/down but that is the meat of it. If you are a big artist like, say Ed Sheeran or Beyoncé, you might accrue a million YouTube views within a few hours. I have seen the most average and commercial songs celebrate tens-of-millions in terms of viewing figures.
An article written by music ally distilled the differences between the streaming sites and how much each pays:
“Spotify’s average per-stream payout has fallen by 16% since 2014, according to a new dataset published by artist-rights blog The Trichordist.
The figures are based on 2016 streaming data for an independent label with around 150 albums available digitally, which is compared to a similar study in 2014.
According to the analysis, Spotify generated $0.00437 per stream for the label in 2016, down from $0.00521 in 2014.
Yet Spotify accounted for 69.6% of the label’s overall streaming revenues: its per-stream rate may have fallen, but its scale still makes it the major earner for this particular catalogue.
(Additional context: if Spotify users have become more engaged in its service over time, listening to more music by more artists, that would be a factor in the falling average per-stream payout. When Spotify relaunched its artists portal in November 2016, it stopped publishing its own figure for average per-stream payout to all rightsholders.)
Apple, meanwhile, sits “in the sweet spot generating the second largest amount of streaming revenue”, with a per-stream rate of $0.00735. That’s 68% more than Spotify, although Apple only accounted for 13.4% of the label’s streaming revenues in 2016.
The Trichordist also highlighted the fact that YouTube accounted for 21.7% of the label’s streams, but only 3.8% of its streaming revenue.
“The top 10 streamers account for 99% of all streaming revenue,” added its analysis. In fact, the top six services – Spotify, Apple, Google, YouTube, Deezer and Rhapsody – account for 96.8%.
The source of this data, an independent label, is likely to be the reason for Amazon not showing up strongly in the chart, with just 0.6% of streams and revenue. For most of 2016, Prime Music was Amazon’s only music-streaming service, and its focus is a smaller, more mainstream catalogue of music.
The Trichordist has also calculated the number of streams needed on the various services to equal a traditional sale: 139 streams on Spotify, 83 on Apple Music, 90 on Google Play, 95 on Deezer and, ahem, 876 on YouTube”.
IN THIS PHOTO: Katy Perry
Spotify, it appears, pay 0.00429p for each stream. If you are, again a Sheeran or a Katy Perry; you might be able to make a handsome profit in a few weeks. The problem is this: those who struggle for money and need to make a profit are rarely seen headlining Glastonbury and topping the album charts. One can argue about the modern music versus older music in terms of quality, innovation and durability – which decade is finest and whether modern artists can ever create those legendary albums that will survive down the years. What I can say with confidence is there are many more new, unsigned artists than there were in the past. We all know how accessible music is and how easy it is to create a song – before the Internet and devices like an iPad; music was usually reserved for studio acts and those with a record deal. With so many artists entering the scene, one would hope they are being reimbursed.
How easy is it for a new artist – not signed to a big label – to earn a proper living?!
I have given you the figures so ponder this: how many streams (on YouTube and/or Spotify) is a new band/artist likely to gain? No matter how good the song is, you’ll likely be looking at a couple-of-thousand views rather than tens-of-millions. That, in profit terms, would barely cover an hour in a studio. Certainty, you would have spent more money making a song than you ever will receive in reimbursement the other end. There is a struggle between artists wanting their music to be available to all and those who want to make money. If you want your songs to reach the wider world, the sad truth is this: you will need to make them free. People like me are happy to pay a Spotify subscription free but most prefer their music on sites like YouTube and SoundCloud – where one can hear it all (with no charge) whenever they want.
Many new artists are putting in contract clauses and telling labels they do not want their music released on YouTube. It is a sort-of drop-out clause but essentially means their new songs are only available on platforms that pay them adequately. Of course, there will always be someone somewhere who will get a song and put it onto the site – with or without the artist’s consent. That is unavoidable but there is a sensibility in omitting your music from those free sites.
Making them reserved for iTunes – where there is a set fee for downloading a track; a larger percentage of the price goes to the artists directly – is a wise move many are being forced to take.
Even if a mainstream artist produces a wonderful video for an epic track, they might only get a few-thousand pounds/dollars over a few months. That might seem like a nice pay-out but consider how much the song cost to produce – and how much the video cost to record. The same dynamic and percentages can be applied to those brand-new artists. Many have a shoestring budget and can spend hundreds on a video and track. They eagerly await those big streaming figures and find, when the figures are totted up, the cheque does not even cover the studio fees. Relying on iTunes is brave and ethical but is that career suicide? If they remove their music from all sites but iTunes; how tolerant and understanding will the consumer be?! I would suggest they’d be angered and go seeking artists who make their music more available and, well, ‘free’.
Is there ever a way you can exploit the digital platforms and keep your integrity intact? Can you put your music on every platform and, satisfying both sides of the debate, make a good profit and provide free music to those unwilling to pay?! I would suggest this eventuality is reserved for those in the mainstream – maybe new artists who have quite a commercial sound. If you are willing to get into bed with quite a few advertisers, you might find more money coming in but, in reality, how much is that going to be?! It seems like we are in a quandary: do you force people to pay for YouTube/SoundCloud etc and charge a small, affordable fee per download stream or maybe a yearly subscription free? Spotify urges its users to adopt this policy but does allow a free streaming service. Do they impose limitations and only allow a few downloads a week before they charge? I think there is something like on the site but maybe it is not stringent enough.
If I, for instance, want to hear a new track from a London Pop act, then I can go to Spotify and stream it for free. Once I have that track on my site/in my possession, there is no way of limiting and monitoring where that track goes. I can play it at a D.J. set and can share it with my subscribers.
They, in turn, can access the track for free and spread it as thinly as they like.
Once a single person accesses a track, there are no laws and restrictions defining what they do with a song. Because of that, an artist can be exposed in a good and bad way. They get their music to a lot of people – good for their fan numbers and attention – but often get a pittance for that ‘generosity’. In my view, sites like iTunes, although they charge everyone for every song, is that 79p fee A) going to the artist without any division and redistribution and, B) enough?! Maybe an E.P. will be launched on iTunes for 316 English pennies and sell two-hundred units. That is a nice little earner but, as I said, does the artist get all the money?!
Even then, the chances of those figures being realised are, at best, quite ambitious. Many new acts have to share their music on platforms like BandCamp and SoundCloud so reviewers and websites have a free-to-use alternative when promoting. I am waffling slightly – nothing new there! – but my point is valid. It is so hard setting tariffs and setting rules that appeal to everyone. On the one hand, you want to, as a new musician, make your music available to as many as possible but ensure you are compensated for that music. On the other, you have to accept most streaming sites cannot force users to pay –per-download – you have to have some flexibility and pragmatism. I listen to around a dozen YouTube videos a day and if you YouTube charged me a set fee for each play; I would likely be less likely to use the site – meaning I would be listening to less music less often.
The option most new artists have to take is the touring route. In an ultra-competitive and busy music industry, it seems gigging is the easiest way of making any money. Of course, there is an ever-present drawback with this route: the fact so many venues are closing; meaning there are fewer available for artists to perform in. Many assume the ‘toilet circuit’ is always available and there are enough options for every act.
Maybe that is the case in the bigger cities but those who reside away from these areas rely on those local venues in order to make some money and, therefore, continue to make music.
Throw into the agenda all those sundry and peripheral costs associated with touring – travel and fuel costs; roadies, equipment and stuff like food and hotels – and a single date can cost you as much as you’ll earn on the night.
Because of that, tied to the capriciousness and unpredictability of crowds and venues, artists are subjecting themselves to a gruelling reality: having to do dozens (maybe hundreds) of dates a year so they can survive – let alone expand their horizons and think bigger. If you are, say, a five-piece band releasing their debut E.P., you’ll want to promote it, right?
Even if you rely on a blend of homemade studios and D.I.Y. technologies – and the odd iPad benefit here and there – you will still need to master and engineer those songs.
The musicians need to have instruments and there are going to be the human costs involved – long hours away from day jobs and the stress of getting everything recorded as cost-effectively as possible. Then, comes the streaming and promotion which means putting it on sites like iTunes and Spotify. Maybe they will get several-hundred streams over a set course – that amounts to a very small comeback after the initial outlays. On that basis, you might be about break-even when you tot up the profit-and-loss sheets are completed. So, you have the recordings out there and they are proving popular. Maybe good from an ego and recruitment perspective but pretty crap from a profitability standpoint.
Going back to the drawing board, that act then needs to look ahead: how do they turn that hard work and savvy promotion into actual money?! Maybe you can get some radio interviews that will pay a bit of money but, ironically factoring in the travel costs and various expenses, you are still scraping together a meagre sum. The only realistic option is to tour.
If you are based out of London, then you need to rally around the local circuit. Even if you have a couple of decent venues on your doorstep, that might only bring in a small crowd.
If you get paid, say, two-hundred quid a gig – that is generous in a lot of cases – that money is often not reserved solely to the band. There might be lighting technicians and sound guys/girls; the drivers and various bodies who transport the equipment and make the music happen. Look at the tip jar at the end of a gig and each member might earn less than they would were they to spend the same amount of time working in the local boozer. Ironically, the option to hit the drink might be too powerful to refute. So, because of this, they have to multiply and apply logic: performing as many gigs as we can stand to earn enough money. This plan often involves touring up and down the country to as many venues as will have them/you/. If you have patience and the energy to do this and manage to make a little bit of money after the gigs, how much is left in the kitty to make a new record? Many artists have to balance music with full-time jobs – so they can pay rent and eat in addition to recording music. It is a savage and Draconian taunt but one many are willing to undertake – the sheer passion and love they have for music is stronger than fiduciary ball-kicks.
Therefore, it seems, the bottom-line is this: a musician has to perform a fu**-load of gigs so they can afford to release that next single/E.P. I am making this sound very bleak but there is the up-side: artists getting out there and seeing new faces; that sheer affection and desire to perform live outweighs and overpowers the anxiety-provoking nature of earnings and fairness. Many artists come to people like me to promote their music and, hopefully, push it out to new audiences. That is another strand to an artist’s life: self-promotion and merely getting people to listen to their stuff. That can be a part—time job in itself and, when unified with touring and recording – and a full-time job – that is a frightening acceptance.
We all see articles where artists share their royalties after achieving huge streaming figures. One might, naturally, think they’d be raking it in but there is the problem: they are making hardly anything at all. I think a lot of the argument boils down to a sense of reality and compassion. If you get a million streams of Spotify, you cannot, realistically get a million quid/dollars. That would seem fair but the only way of doing this is to charge each listener that much per stream – would you pay a pound for each time you streamed a track?! People like me, who stream dozens of songs a week, would be broke within a matter of days – the irony would not be lost on musicians. There is no ‘set price’ that would act as a compromise and appease music listeners and satisfy the musicians’ demands. It is a tough debate and one that has no easy answers.
Whilst nobody can agree on any short-term solutions we all can agree on the following: musicians are not being fairly compensated and acknowledged by streaming sites and their subscribers.
They are torn between their heartfelt desire to share the music but the – quiet and modestly stated – need to be paid and rewarded for their good work.
I shall finish by re-invoking that age-old, old-age debate: were things better in decades past? That ‘better’ part is rather subjective and hard-to-define. If we are talking about the quality of the music, then I would say ‘yes’ – the quality and consistency was a lot better in decades like the ‘70s and ‘90s; those classic albums came out then; a year like 1994 could see more world-class albums that a decade like the ‘10s, for instance. If one is referring to fairness and equality, then that might be harder to answer. Musicians, to get to a studio and make it to the record stores, usually had a record deal and people paying for the studio. There were far fewer unsigned acts realistically aiming for a career and getting their music to a large number of people. It was mainstream-heavy but that came with a benefit: people were forced to pay for albums/singles and, therefore, every song/album would mean definite funds for musicians. One can argue – like a charity fundraising for those less-well-off – how much of that cash found its way to an artist – that is an argument for another day.
The point is the artists got paid and less reliant on touring. Technological advancement and an open market have meant certain realities have crept in. It may take years but I, as a music lover and someone who supports new musicians, know music will only survive and see growth if we make sure artists are paid for their music.
If a new artist – usually something bigger acts do – make it impossible for their songs to be heard on ‘free’ sites, they risk shooting themselves in the foot.
Those big charts acts might be able to make a handsome profit on Spotify alone but can a new artist?! I doubt it so, in a bittersweet slap in the chops, they need to compromise and allow a degree of ignorance and pacificism to form – meaning thousands can get hold of their music for no cost at all. It is heart-breaking to see this practice continue unabated but forms part of a complex and multi-layered argument. However you see music-sharing and the ethics of streaming music for free – making it cost-real to allow an artist get better exposure – you cannot argue against the fact…
SOMETHING needs to change.