4 ms·

On Spotify, the top 0.4% of artists are responsible for 9.9% of streams.

by tyho 6y ago

iso947 6y ago
But not 9.9% of the revenue. Bob streams track 11,12,13,14 1,000 times a month each for their €10 Jamie streams track 21,22,23,24 100 times each for their €10 Total revenue €20, Total streams 4,400. .45c per stream. Track 11 gets €4.50, track 21 gets €0.45
- rckoepke 6y ago
  Stealing and rephrasing this for clarity: Alice pays $10/month fee. Alice only listens to track A 990 times. Bob pays $10/month fee. Bob only listens to track B 10 times. Total revenue $20, Total streams 1000. $0.02 per stream. Track A gets $19.80, track B gets $0.20 If Bob got his twin brother to subscribe, and they had the exact same listening pattern next month: Alice pays $10/month fee. Alice only listens to track A 980 times. (Alice listens to the song less this month than last month) The Bobs are now paying $20/month. The Bobs only listen to track B 20 times total (Each Bob listens to the track 10 times). Total revenue $30, Total streams still 1000. $0.03 per stream. Track A gets $29.40. Track B gets $0.60. Track A just increased its revenue 48% despite being listened to less the second month. Track B was responsible for Spotify earning $10 more, but only saw $0.40 of what it brought into Spotify. However, I'm not sure what the downstream ramifications of the new incentives would be after hypothetically switching from pro-rata payment structure to a per-user structure. Would artists' / music labels' strategies change? I also wonder what would happen to the revenue from users who pay subscriptions for a month, but neglect to use the service at all. It seems it would make sense to either pay the artists that user has listened to over their lifetime/past year, or distribute pro-rata across all of Spotify.
dutchmartin 6y ago
And this seems reasonable, since I would expect that most of the streams come from the ‘popular in country x’ playlist.
kzrdude 6y ago
And premium users pay for everyone's streams. That's one of the conflicts, and the other is that those who listen to fewer plays get less influence than those who listen to many. So even if all the premium users prefer jazz (for example), their money will mostly go to whatever the free users prefer listening to. If spotify itself was seen as a market - I wouldn't say that this would be a very well-functioning market, because of the mismatch between what you use and who you pay.
- WJW 6y ago
  Don't non-premium users get ads interspersed into their playlists to make up the difference?
  - kzrdude 6y ago
    It doesnt make up for the difference
    - kjaftaedi 6y ago
      Your comment implies the ad-supported users are responsible for revenue loss. In my mind, decisions like giving Joe Rogan 100 million dollars are more likely culprits.
      - kzrdude 6y ago
        Paying users provide 90% of the income. That pretty much says that if it wasn't for them, Spotify would not be here today. Edit: That's the first I hear of that deal, and that's insane. Not a podcast I listen to, and I don't want to use any of the user-tracking, user-inlocking podcast players.
    - dmurray 6y ago
      Why not? Ads are enough to pay the licensing costs for radio stations, which have higher distribution costs and worse economies of scale than Spotify.

On Spotify, the top 0.4% of artists are responsible for 9.9% of streams.

by tyho 6y ago

On Spotify, the top 0.4% of artists are responsible for 9.9% of streams.

But not 9.9% of the revenue. Bob streams track 11,12,13,14 1,000 times a month each for their €10 Jamie streams track 21,22,23,24 100 times each for their €10 Total revenue €20, Total streams 4,400. .45c per stream. Track 11 gets €4.50, track 21 gets €0.45

rckoepke 6y ago
Stealing and rephrasing this for clarity: Alice pays $10/month fee. Alice only listens to track A 990 times. Bob pays $10/month fee. Bob only listens to track B 10 times. Total revenue $20, Total streams 1000. $0.02 per stream. Track A gets $19.80, track B gets $0.20 If Bob got his twin brother to subscribe, and they had the exact same listening pattern next month: Alice pays $10/month fee. Alice only listens to track A 980 times. (Alice listens to the song less this month than last month) The Bobs are now paying $20/month. The Bobs only listen to track B 20 times total (Each Bob listens to the track 10 times). Total revenue $30, Total streams still 1000. $0.03 per stream. Track A gets $29.40. Track B gets $0.60. Track A just increased its revenue 48% despite being listened to less the second month. Track B was responsible for Spotify earning $10 more, but only saw $0.40 of what it brought into Spotify. However, I'm not sure what the downstream ramifications of the new incentives would be after hypothetically switching from pro-rata payment structure to a per-user structure. Would artists' / music labels' strategies change? I also wonder what would happen to the revenue from users who pay subscriptions for a month, but neglect to use the service at all. It seems it would make sense to either pay the artists that user has listened to over their lifetime/past year, or distribute pro-rata across all of Spotify.

dutchmartin 6y ago

And this seems reasonable, since I would expect that most of the streams come from the ‘popular in country x’ playlist.

kzrdude 6y ago

And premium users pay for everyone's streams. That's one of the conflicts, and the other is that those who listen to fewer plays get less influence than those who listen to many. So even if all the premium users prefer jazz (for example), their money will mostly go to whatever the free users prefer listening to. If spotify itself was seen as a market - I wouldn't say that this would be a very well-functioning market, because of the mismatch between what you use and who you pay.

WJW 6y ago
Don't non-premium users get ads interspersed into their playlists to make up the difference?
- kzrdude 6y ago
  It doesnt make up for the difference
  - kjaftaedi 6y ago
    Your comment implies the ad-supported users are responsible for revenue loss. In my mind, decisions like giving Joe Rogan 100 million dollars are more likely culprits.
    - kzrdude 6y ago
      Paying users provide 90% of the income. That pretty much says that if it wasn't for them, Spotify would not be here today. Edit: That's the first I hear of that deal, and that's insane. Not a podcast I listen to, and I don't want to use any of the user-tracking, user-inlocking podcast players.
  - dmurray 6y ago
    Why not? Ads are enough to pay the licensing costs for radio stations, which have higher distribution costs and worse economies of scale than Spotify.