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>Spotify pays whoever holds the rights to a song anywhere from $0.006 to $0.0084 per play. It makes me happy that the cost of digital goods is falling. The dis

>Spotify pays whoever holds the rights to a song anywhere from $0.006 to $0.0084 per play. It makes me happy that the cost of digital goods is falling. The distribution costs are so low for a digital item that this price seems much more in line with what people should pay for a download / stream. Interestingly, at $10 a month Spotify is charging users $0.00023 per minute (60 * 24 * 30). If each song is about 3 minutes, they're making money on anyone who spends less than 10% of their time listening to music.

kbutler 8y ago
...if that were Spotify's only cost of service. They also pay for bandwidth, servers, application development, customer acquisition, ...
msvan 8y ago
Digital goods are not worthless because they can be downloaded easily. Distribution costs shouldn't matter much when determining price. Competition should though, and there is plenty of competition for people's time between digital goods. Also, I'm sure Spotify pays for engineers, offices, lawyers, designers, servers, marketing, avocado toasts and other essentials in addition to royalties.
- pureliquidhw 8y ago
  I agree with your underlying point, but distribution cost absolutely matters when determining price. Competition for time is a great way of framing why I pay for many services. I pay $10 to Spotify to avoid hundreds of commercials each month, it is absolutely worth it to me. Same with Netflix. Would do the same with Gmail if it was an option.
  - extra88 8y ago
    > Would do the same with Gmail if it was an option. It is, pay for G-Suite.
    - pureliquidhw 8y ago
      I've looked at that before, and I can't claim this with 100% certainty, but seems I cannot use my current email address. I don't want to change that.
dgzl 8y ago
I used to justify piracy by thinking that the digital data was more like particles in water than items on a shelf. If you pee into the water, it doesn't matter how much or where you aim, all the water is corrupted. In the same way, if an artist releases digital work, they're essentially giving it away because there's no effective way to contain it. DRM fails just like trying to stop pee from spreading in water. I held the idea that if an artist uses a digital medium, they should just accept that when it's copied once (from their private computer to the public web) that it's copied indefinitely. I would claim that the nature of the digital world and internet can't support the blocking off information like that. I'd like to still believe in this, but I'm not sure the logic holds up. I pay about $20/year for Spotify because several of my friends have a family plan. I know this tactic is used with foreign students and cell phone plans as well.
apocalypstyx 8y ago
Interesting how when the cost distribution falls due to technological change, no one (or hardly anyone) ever proposes that small portion of that should be shifted to the artist / writer end of equation. I would be willing to argue that implicitly the average consumer has already pegged the monetary value of writer / artist's contribution as ~0 and that what people actually peg for value is entirely the physical product that is otherwise unrelated to what is encoded on or within it, which is why you get so many commentators who think purchase price should only ever solely follow the price of the media, whereas, on the production end, the writer /artist's cut has always been determined on the logic of what must be carved out of the price in relation to the production and distribution of that physical medium. So, in essence, when it comes right down to it, both capitalist rights holders and the consumer public, believe in a kind of pseudo slavery where what they want is produced with minimal to no financial impingement upon themselves (which, of course, only make evolutionary sense).

kbutler 8y ago

...if that were Spotify's only cost of service. They also pay for bandwidth, servers, application development, customer acquisition, ...

msvan 8y ago

Digital goods are not worthless because they can be downloaded easily. Distribution costs shouldn't matter much when determining price. Competition should though, and there is plenty of competition for people's time between digital goods. Also, I'm sure Spotify pays for engineers, offices, lawyers, designers, servers, marketing, avocado toasts and other essentials in addition to royalties.

pureliquidhw 8y ago
I agree with your underlying point, but distribution cost absolutely matters when determining price. Competition for time is a great way of framing why I pay for many services. I pay $10 to Spotify to avoid hundreds of commercials each month, it is absolutely worth it to me. Same with Netflix. Would do the same with Gmail if it was an option.
- extra88 8y ago
  > Would do the same with Gmail if it was an option. It is, pay for G-Suite.
  - pureliquidhw 8y ago
    I've looked at that before, and I can't claim this with 100% certainty, but seems I cannot use my current email address. I don't want to change that.

dgzl 8y ago

I used to justify piracy by thinking that the digital data was more like particles in water than items on a shelf. If you pee into the water, it doesn't matter how much or where you aim, all the water is corrupted. In the same way, if an artist releases digital work, they're essentially giving it away because there's no effective way to contain it. DRM fails just like trying to stop pee from spreading in water. I held the idea that if an artist uses a digital medium, they should just accept that when it's copied once (from their private computer to the public web) that it's copied indefinitely. I would claim that the nature of the digital world and internet can't support the blocking off information like that. I'd like to still believe in this, but I'm not sure the logic holds up. I pay about $20/year for Spotify because several of my friends have a family plan. I know this tactic is used with foreign students and cell phone plans as well.

apocalypstyx 8y ago

Interesting how when the cost distribution falls due to technological change, no one (or hardly anyone) ever proposes that small portion of that should be shifted to the artist / writer end of equation. I would be willing to argue that implicitly the average consumer has already pegged the monetary value of writer / artist's contribution as ~0 and that what people actually peg for value is entirely the physical product that is otherwise unrelated to what is encoded on or within it, which is why you get so many commentators who think purchase price should only ever solely follow the price of the media, whereas, on the production end, the writer /artist's cut has always been determined on the logic of what must be carved out of the price in relation to the production and distribution of that physical medium. So, in essence, when it comes right down to it, both capitalist rights holders and the consumer public, believe in a kind of pseudo slavery where what they want is produced with minimal to no financial impingement upon themselves (which, of course, only make evolutionary sense).