Copyright Critics Don’t Quite Get Artists | The Illusion Of More

A must read from David Newhoff for all creators with many points, well made.

Further, if it is true that a copyright-free future could shrink the pool of producers to those already financially secure (as predicted above), this suggests that all of the non-remunerative benefits of copyright might be of even greater value to those authors still willing and able to produce. And in the absence of those rights, we could easily see a reduction not only in the number of producers, but also in the number of works produced by that elite few. In a practical example, imagine the trustafarian artist working in the most altruistic manner, producing wonderful works solely to be experienced; he doesn’t care about money, but he does have to accept that McDonald’s can use his work to sell hamburgers, which betrays everything he is expressing. It is not farfetched to imagine the artist in this example will withhold works from public view, even if he continues to produce for his own pleasure.

READ THE WHOLE POST AT:
http://illusionofmore.com/copyright-critics-dont-get-artists/

#irespectmusic Turtles Win in New York pre-72 Case Against SiriusXM

trichordist:

Have a Great Weekend!

Originally posted on MUSIC • TECHNOLOGY • POLICY:

More to follow, but the Turtles win another one for all pre-72 artists in federal court in New York applying New York state copyright law.

Turtles NY Memorandum and Order Denying Defendant’s Motion for Summary Judgement

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Apple Announces Itunes One Dollar Albums and Ten Cent Song Downloads | Sillycon Daily News

Satire – but not by much.

Apple Computer announced today that for it’s Itunes Music Store to remain competitive in the digital distribution marketplace for music they would be changing their retail pricing of album downloads to one dollar and song downloads to 10 cents each. The pricing change will be effective on black Friday for this holiday season. “Since we purchased Beats music and are competing directly with Spotify we recognized the need for more competitive pricing structures based on what consumers may be willing to pay”, an Apple spokesman said. He continued, “Spotify has proven that as long as we’re paying 70% of gross, the retail pricing is irrelevant, irrelevant! We are even contemplating 10 cent albums and one cent songs to further achieve parity with music streaming services!”

Record label executives rejoiced in the move as one source exclaimed,” I don’t know why we didn’t think of reducing the retail price of downloads by 90% years ago. It’s still money, right? It’s so simple that this is really the only way to grow the business to $100b annually while competing with piracy.”

 

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Music Streaming, New Money Vs. Old and the Market Cap of All Music… | The Cynical Musican

A must read post from The Cynical Musician:

“In a hypothetical future that is nothing but streaming (a depressingly real possibility, given that everything but streaming is going down the drain), the size of the industry is capped at 70% of streaming service revenue. There’s no way to grow the industry, because there’s no new money coming in. The subscription revenue pays for all present and future consumption, it doesn’t matter how many (or few) hot new releases there are. In fact, it doesn’t even matter what music is on the service or how popular it is. The size of the pie is fixed from the start.”

READ THE FULL POST HERE:
http://thecynicalmusician.com/2014/11/new-money/

Will The New YouTube Streaming Service Feature All the Hate Rock Currently Featured On YouTube?

I’m sure all the violent white supremacists the world over are excited about the launch of the new YouTube music service!  Will they be able to listen to Kill Baby Kill or Angry Aryans and recruit new followers to our violent Neo-Nazi movement the way they can currently on YouTube? 

Violent terrorist skinheads the world over  are anxiously holding their breaths!

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The Streaming Price Bible – Spotify, YouTube and What 1 Million Plays Means to You!

Several of our posts on streaming pay rates aggregated into one single source. Enjoy…

[UN to Airlift Calculators, Behavioral Economics Textbooks to Digital Music Industry]

musicstreamingindex020114[EDITORS NOTE: All of the data above is aggregated. In all cases the total amount of revenue is divided by the total number of the streams per service  (ex: $5,210 / 1,000,000 = .00521 per stream). In cases where there are multiple tiers and pricing structures (like Spotify), these are all summed together and divided to create an averaged, single rate per play.]

If the services at the top of the list like Nokia, Google Play and Xbox Music can pay more per play, why can’t the services at the bottom of the list like Spotify and YouTube?

We’ll give you a hint, the less streams/plays there are the more each play pays. The more plays there are the less each stream/play pays. Tell us again about how these services will scale. Looking at this data it seems pretty clear that the larger the service get’s, the less artists are paid per stream.

So do you think streaming royalty rates are really going to increase as these services “scale”? No, we didn’t either.

[ BREAKING! Apple Announces Itunes One Dollar Albums and Ten Cent Song Downloads In Time For The Holidays! | Sillycon Daily News ]

 

StreamingPriceIndexwYOUTUBE

We’ve been waiting for someone to send us this kind of data. This info was provided anonymously by an indie label (we were provided screenshots but anonymized this info to a spreadsheet). Through the cooperative and collaborative efforts of artists such as Zoe Keating and The Cynical Musician we hope to build more data sets for musicians to compare real world numbers.

In our on going quest for openness and transparency on what artists are actually getting paid we’d love to hear from our readers if their numbers and experience are consistent with these numbers below. At the very least, these numbers should be the starting point of larger conversations for artists to share their information with each other.

Remember, no music = no business.

whatyoutubereallypaysFor whatever reason there appear to be a lot of unmonetized views in the aggregate. So let’s just focus on the plays earning 100% of the revenue pool in the blue set. These are videos where the uploader retains 100% of the rights in the video including the music, the publishing and the video content itself.

Plays  Earnings  Per Play
2,023,295 $3,611.84 $0.00179
1,140,384 $2,155.69 $0.00189
415,341 $624.54 $0.00150
240,499 $371.47 $0.00154
221,078 $313.47 $0.00142
TOTALS TOTALS AVERAGE
4,040,597 $7,077.01 $0.00175

So it appears that YouTube is currently paying $1,750 per million plays gross.

We understand that people reading this may report other numbers, and that’s the point. There is no openness or transparency from either Spotify or YouTube on what type of revenue artists can expect to earn and under what specific conditions. So until these services provide openness and transparency to musicians and creators, “sharing” this type of data is going to be the best we’re going to be able to do as East Bay Ray comments in his interview with NPR.

As we’re now in a world where you need you need a million of anything to be meaningful here’s a benchmark of where YouTube ranks against Spotify.

Service  Plays  Per Play  Total  Notes 
Spotify To Performers/Master Rights 1,000,000 0.00521 $5,210.00 Gross Payable to Master Rights Holder Only
Spotify To Songwrtiers / Publishers This revenue is for the same 1m Plays Above 0.000521 $521.00 Gross Payable to Songwriter/s & Publisher/s (estimated)
YouTube Artist Channel 1,000,000 0.00175 $1,750.00 Gross Payable for All Rights Video, Master & Publishing
YouTube CMS (Adiam / AdRev) ** 1,000,000 0.00032 $321.00 Gross Payable to Master Rights Holder Only

The bottom line here is if we want to see what advertising supported free streaming looks like at scale it’s YouTube. And if these are the numbers artists can hope to earn with a baseline in the millions of plays it speaks volumes to the unsustainability of these models for individual creators and musicians.

Meet the New Boss: YouTube’s Monopoly on Video | MTP

It’s also important to remember that the pie only grows with increased revenue which can only come from advertising revenue (free tier) and subscription fees (paid tier). But once the revenue pool has been set, monthly, than all of the streams are divided by that revenue pool for that month – so the more streams there are, the less each stream is worth.

All adrev, streaming and subscription services work on the same basic models as YouTube (adrev) and Spotify (adrev & subs). If these services are growing plays but not revenue, each play is worth less because the services are paying out a fixed percentage of revenue every month divided by the number of total plays. Adding more subscribers, also adds more plays which means that there is less paid per play as the service scales in size.

This is why building to scale, on the backs of musicians who support these services, is a stab in the back to those very same artists. The service retains it’s margin, while the artists margin is reduced.

[** these numbers from a data set of revenue collected on over 8 million streams via CMS for an artist/master rights holder]

Here’s what 1 million streams looks like from different revenue perspectives on the two largest and mainstream streaming services.

Service  Units Per Unit  Total  Notes 
Spotify 1,000,000 $0.00521 $5,210.00 Gross Payable to Master Rights Holder Only
Spotify same million units as above $0.00052 $521.00 Gross Payable to Songwriter/s & Publisher/s (est)
YouTube 1,000,000 $0.00175 $1,750.00 Gross Payable for All Rights Video, Master & Publishing
YouTube CMS Master Recording (Audiam / AdRev) 1,000,000 $0.00032 $321.00 Gross Payable to Master Rights Holder Only
STREAMING TOTALS  3,000,000 $7,802.00 TOTAL REVENUE EARNED FOR 3 MILLION PLAYS ON SPOTIFY AND YOUTUBE 
Itunes Album Downloads 1,125 $7.00000 $7,875.00 Gross payable including Publishing

Here are some compelling stats on the break down of what percentage of videos on YouTube actually achieve breaking the 1 million play threshold, only 0.33%

CHART OF THE DAY: Half Of YouTube Videos Get Fewer Than 500 Views | Business Insider

Some 53% of YouTube’s videos have fewer than 500 views, says TubeMogul. About 30% have less than 100 views. Meanwhile, just 0.33% have more than 1 million views.

That’s not a huge surprise. But it highlights some of the struggles Google could have selling ads around all those unpopular videos, despite the money it has to spend to store them.

An artist needs to generate THREE MILLION PLAYS on the two largest and most popular streaming platforms to equal just 1,125 album downloads from Itunes. This is an important metric to put in context. In 2013 only 4.8% of new album releases sold 2,000 units or more. So if only 4.8% of artists can sell 2,000 units or more, how many artists can realistically generate over four million streams from the same album of material?

in 2013 there were 66,565 new releases, only 3,237 sold more than 2,000 units = 4.8% of new releases sold over 2,000 units

in 2013 there were 915,482 total releases in print, only 14,856 sold more than 2,000 units = 1.6% of ALL RELEASES in print sold more than 2,000 units.

This is even more important when you start to consider that many artists feel that growing a fan base of just 10,000 fans is enough to sustain a professional career. Note we said solo artists because these economics probably need to be multiplied by each band member added for the revenue distribution to remain sustainable. So a band of four people probably need a sales base of 40,000 fans to sustain a professional career for each member of the band.

Each 10,000 albums sold on iTunes (or 100,000 song downloads) generates $70,000 in revenue for the solo artist or band. To achieve the same revenue per 10,000 fans in streams, the band has to generate 30 million streaming plays (as detailed above) if they are distributing their music across the most common streaming services including Spotify and YouTube.

In 2013 the top 1% of new releases (which happen to be those 620 titles selling 20k units or more) totaled over 77% of the new release market share leaving the remaining 99% of new releases to divide up the remaining 23% of sales.

This appears to confirm our suspicion that the internet has not created a new middle class of empowered, independent and DIY artists but sadly has sentenced them to be hobbyists and non-professionals.

Meanwhile the major artists with substantial label backing dominate greater market share as they are the few who can sustain the attrition of a marketplace where illegally free and consequence free access to music remains the primary source of consumption.

What’s worse is that it is Silicon Valley corporate interests and Fortune 500 companies that are exploiting artists and musicians worse than labels ever did. New boss, worse than the old boss, indeed.

So whose feeling empowered?

RELATED:

UN to Airlift Calculators, Behavioral Economics Textbooks to Digital Music Industry

Streaming Is the Future, Spotify Is Not. Let’s talk Solutions.

Who will be the First Fired Label Execs over Spotify Fiasco & Cannibalization?

 

 

 

 

Maybe Pandora Founder is Building 17 Bedroom 14 Bath Mansion to House all the Songwriters and Performers he Made Homeless?

Locals in the lovely fishing village of Inverness CA  ( I shot half a video there) are up in arms wondering just what Pandora founder Tim Westergren is doing with an old Russian Monastery.  Google Street View here.

As The San Jose Mercury News reports.

Judging from the many letters of opposition that have been sent to county planners, most residents are aghast at the size of the 8,297-square-foot project, which would have 14 bathrooms and up to 17 “functional” bedrooms, according to critics, and would be up to four times larger than the median-sized house in this community of remodeled summer homes, weekend cottages, rustic cabins and modest single-family dwellings.

Westergren says his plans call for nine bedrooms total, but the Inverness Association, an 84-year-old organization of property owners and preservationists, concludes that the second unit “functions as a six-bedroom, two bath housing unit with detached two-car garage” and the septic systems have been sized to service 11 bedrooms in the main residence and six bedrooms in the second unit. (read more)

Some are speculating that rather than a house he intends to open a boutique hotel. 

We have have another suggestion:

  Westergren can use the property to house the songwriters he has made homeless by his relentless war on songwriters and performers.

http://thetrichordist.com/2013/06/24/my-song-got-played-on-pandora-1-million-times-and-all-i-got-was-16-89-less-than-what-i-make-from-a-single-t-shirt-sale/

http://thetrichordist.com/2014/04/30/no-respect-pandora-stops-paying-aretha-franklin-and-other-artists-royalties-while-ceo-rakes-in-29-million-dollars/

Tim Westergren making 1 million a month in stock sales

http://musictechpolicy.wordpress.com/2013/05/03/the-return-of-irfa-million-a-month-tim-charges-on/

And look at the other Pandora insiders selling stock like crazy!

http://www.secform4.com/insider-trading/1230276.htm

#irespectmusic Blake Morgan on his CNN Interview and the Latest Spotify Debacle

Trichordist Editor:

#irespectmusic Blake Morgan on Spotify and Artists….

Originally posted on MUSIC • TECHNOLOGY • POLICY:

MTP: I watched your CNN interview with Poppy Harlow and you made some significant points that don’t get picked up much.  Let’s start with the last one:  Spotify could be the next Myspace.  I think we all remember when Myspace was viewed as the Second Coming and then one year it just evaporated.  I was trying to remember the CEO’s name. What about Spotify reminds you of Myspace?
Blake Morgan: The false idea that Spotify is inevitable and gargantuan. In fact, if they don’t evolve, they may find themselves more like Goliath. And we all know what happened to Goliath, right? If you don’t, just ask MySpace. Streaming is not itself in question here, any more than MySpace’s failure called the idea of social media into question. It didn’t. Its failure was a reflection on MySpace, and its model. Same thing here. Streaming may or may not be a viable…

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Thank You For Appointing Me CEO of Spotify: Now a Strategic Plan to Fix the Service.

The music business press has repeatedly criticized artists for not providing a solution for the problems with streaming.  Once you get past the amusing fact that it’s not our job nor are we paid to fix streaming services it does become a useful exercise.  Here is my response. 

I would like to thank the shareholders for appointing me CEO of Spotify. I am honored that you placed such great trust in my ability to navigate us through this difficult time.

I would like to make a few comments on the strategy pursued by my predecessor Daniel Ek.  I do this not to criticize my predecessor but to illustrate how my leadership of this company will vary significantly from his.

1.  Under my predecessor’s leadership Spotify pursued a scorched earth policy towards artists that criticized our company. This has been going on for some time.  In the past Spotify engaged surrogates and proxies to attack artists.  This was at best misguided, but the full throated media attack we orchestrated on Taylor Swift was a strategic blunder.

The reality is that Taylor Swift controls her own catalogue and we have given her every reason to NEVER license her songs to the service EVER AGAIN. Swift accounted for more than 20% of all album sales the last two weeks.  It’s likely that she would have represented a similar amount of streams. Her songs are now on our competitors services but not ours.    Spotify can not afford to repeat this mistake.

After I fire all of Spotify’s astroturf consultants, I intend to issue a full apology to the singer–with no conditions–and hereby renounce all such tactics.

2. My predecessor insisted that all songs be available on the free version of the service.  Indeed this is exactly the issue that led Taylor Swift to leave the service.   I believe that this also was a strategic blunder.

By taking a hardline, Spotify lost a once-in-a-decade opportunity to increase revenue and move free users to the premium service.  I intend to modify this policy to allow premium-only content on the subscription service to move free users towards the subscription service.

Further I intend to transition the free service to a free thirty day trial. I believe that Netflix would have never become so successful by competing with itself with a free version. Nor would it have become successful without offering exclusive premium content.

3.  My predecessor was once CEO of uTorrent the world most popular bitTorrent client [Editor’s note-”someone” repeatedly edits this out of Mr. Ek’s wikepedia page–ahem–hence we’ve had to rely on static screen captures.]  I believe that his immersion in the world of piracy impaired his judgement.

My predecessor failed to understand that piracy is the enemy of Spotify.  Unlicensed sites not only hurt artists but compete with Spotify for users and advertisers.  Instead of seeing this as an existential threat Spotify has repeatedly used the threat of piracy as a “club” to keep rightsholders and artists on it’s free service.

I hereby renounce the use of this tactic and going forward intend to create alliances with rightsholders and artists to attack the scourge of ad-funded piracy.

4.   I must commend my predecessor for recognizing (however belatedly) the strategic threat that YouTube represents to all streaming services.  YouTube the video monopoly is also the biggest streaming service.  And it is free. But this is because YouTube hides behind the fiction that it can not control what it’s users upload and Google’s litigation muscle and shakedown rackets.

Much as my predecessor used the threat of piracy as a club, YouTube uses its users as a sort of “torches and pitchforks” mob to threaten rightsholders and artists (not to mention its highly litigious culture).   I believe that this is an illegal practice and I intend to join with rightsholders to press the US government, the European Commission and any other government who is willing into taking action against YouTube on this issue.  Perhaps if all these governments join together, the Google juggernaut can be stopped.  Spotify should lead the charge.

Thank you and I look forward to a long a productive term as CEO of Spotify.

 

RELATED :

 

How to Fix Music Streaming in One Word, “Windows”… two more “Pay Gates”…

 

BUT SPOTIFY IS PAYING 70% OF GROSS TO ARTISTS, ISN’T THAT FAIR? NO, AND HERE’S WHY…

 

 

How to Fix Music Streaming in One Word, “Windows”… two more “Pay Gates”…

We’ve written about this before in two posts, Why Spotify is not Netflix (But Maybe It Should Be) and Streaming Is the Future, Spotify Is Not. Let’s talk Solutions. In Both posts we talk at length about how the problem is not technology or streaming itself, but rather the very restricted business models and poor economics that currently exist. No amount of selective double speak from Daniel Ek will change the bad math that Spotify can not scale at current rates.

Jason Aldean now joins Taylor Swift in removing his music from Spotify which leads us to wonder how many more artists with the ability to do so will remove their new releases and/or catalogs as well. This may also be a good time to revisit those two previous posts mentioned above.

So here is the question, is the record business really utilizing the new digital platforms correctly to address the current market place? Perhaps by looking at the options available to consumers from movie streaming, rental and download businesses we can find more robust and flexible opportunities for artists.

At the very least windowing releases allows artists, their managers and even labels the ability to manage and maximize current revenue streams more effectively. Windowing opens up strategic decisions about tier based pricing relative to the value proposition for both the artist and the consumer. Windowing may not fix all of the problems artists are facing in music streaming but it will be a great first step towards recognizing that the artists should have some direct participation in deciding how their work is consumed.

It’s not that streaming can’t work. It can. It’s that Spotify is a bad business model that has unsustainable economics and exploits artists because it is a wall street financial instrument and not a music company.

Pay Gates may be another solution (which is essentially a window). For example, Spotify premium paid subscribers could access the new Taylor Swift record, but not those using the free version of the service. This also allows artists to determine which songs can be accessed for free for greater promotional value, and which songs are intended to maximize revenue.

Why does Spotify unilaterally get to dictate to artists, managers and labels how to best maximize their relationships and revenues with their own fans?

As Spotify is a destination platform, and not a discovery platform we could see where the current hit singles are only available to paid subscribers while select album tracks could be accessible for free. The tracks on the free tier are monetized only by advertising revenue which pays very little, but there may be a promotional benefit to build awareness on lesser know songs.

Even the old school record business had tier based pricing. There were front-line, mid-line and budget pricing tiers. Front-line titles were often deeply discounted for premium in-store positioning. Mid-line titles were discounted as an incentive to stimulate more sales from recent catalog titles. Budget titles were mostly oldies and very deep back catalog. Primitive as they were, these were windows.

Yes, we know the choir of “or else they’ll steal it” from piracy apologists will claim that anything less the complete devaluation of music as fodder for advertising revenue is pointless. We’ll take our chances with Jason Aldean, Taylor Swift, Adele, Coldplay, Beyonce’, The Black Keys, Thom Yorke and the growing number of artists that are either removing their catalogs from Spotify, or windowing them.

Bring on the windows and pay gates! Let’s see some “innovation” and “disruption” that actually works for artists and not just the new boss. The outcry (from Spotify) of artists removing their songs also proves another very important point – all music is not equal. If some weekend hobbyist does not put their music on Spotify or pulls it off Spotify it doesn’t make headlines. Taylor Swift, Adele, Beyonce, The Black Keys, Thom Yorke, etc – all make headlines because people  actually do VALUE professional music. Professional music, has a professional price.

If Spotify is such a good business for artists, why not let each artist decide if Spotify works for them? Why does Spotify publicly shame artists to convince them how good they are? The lady doth protests too much, wethinks…

It’s funny how long it’s taken the record industry to realize that if you keep allowing something to be given away for free there is no incentive to pay. Who knew?

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RELATED:

Why Spotify is not Netflix (But Maybe It Should Be)

 

Streaming Is the Future, Spotify Is Not. Let’s talk Solutions.

 

Spotify’s Daniel Ek is Really Bad At Simple Math, “Artists Will Make a Decent Living Off Streaming In Just a Few Years”