Music Charts — July 24, 2015 at 4:25 pm

What’s the value of 34 million streamed plays? The answer may surprise you

by

portishead

It’s not a new narrative. Musicians and bands toil away in their artistic endeavors, pouring their heart and soul into producing the music we love and record companies take the lions share, leaving little left for those actually making the music. Few of us could really imagine just how little musicians actually receive though.

For a long time artists have been adamant that services like Spotify, iTunes and Youtube make very little impact on their bottom lines. What is more rare is that an artist or band actually release details about exactly what they receive through these services. Portishead’s Geoff Barrow set social media aflame yesterday with his tweet letting everyone know exactly how much he saw in his own back pocket after the taxman and his record labels had taken their cut. After 34 MILLION streams, the artist received a paltry £1700. That’s just over $2500 in USD at the current exchange rate.

At a rough estimate, this comes out to $0.00007 per stream going into his pocket although the Twitter post did not make it clear whether that was to the band as a whole or to him as an individual.

 

After 34 MILLION streams, the artist received a paltry £1700

 

Whilst Barrow himself is the first to admit that the figures are a rough estimate and obviously not all the streamed plays were coming from Spotify it does present a glaring discrepancy between what should have been received, versus the actuality of the situation. If we assumed all of the streamed plays of Portishead were through Spotify (at the publicly released figures of $0.006 to $0.0084 per play) the total figures should have been in the range of $204,000 – $285,000 for 34 million plays. Spotify, due to their control over the market tend to give a lower per play rate than other music streaming services, so if the plays were through other services, this would likely be a much higher amount.

 

According to the figures, Universal Media Group, have collected a tidy 99% share of the total paid to both label and artists.

 

So that means, that even using a conservative estimate Portishead’s record label, Universal Media Group, have collected a tidy 99% share of the total paid to both label and artists. For an established band like Portishead to receive such paltry royalty checks, it highlights just how much the system is really broken.

 

revenue

Digital distribution and streaming is clearly the way music fans are looking to consume their music. You need look no further than the fact that in 2014, for the first time in history, streaming services brought in more money than CD sales. Music streaming services like Spotify, Rdio, Pandora and Deezer bought in a whopping $1.87 billion compared to $1.85 billion from humble compact disc sales. Digital still commands 37% of the market, having eclipsed physical distribution sales in 2012. But not everyone is seeing the slice of the pie that you might expect.

 

Whilst debate has raged about the value of music streaming to the artists thmsleves, the proliferation of digital downloads has led to The Who’s Pete Townshend famously referred to iTunes as a “digital vampire”,  bleeding artists without offering much in the way of support.
Record labels have always taken a significant slice of the pie for financing manufacturing and distribution costs but digital downloads have eliminated many associated costs of physical distribution such as inventory and manufacturing. The recording industry has been notoriously slow at reacting to changes in the music consumption landscape but clearly the described situation is untenable. No business model can exist, taking 99%  of revenue from the parties you need to survive.