6 ms·

How Much Do Music Artists Earn Online? (2010)

24 points by callum85 13y ago

incision 13y ago
Not the best submission title. Spotify isn't mutually exclusive of the myriad other ways musicians can earn from their music online, many of which are described on this very same infographic.
- callum85 13y ago
  I thought that was clear from "...to earn minimum wage on Spotify". I'm happy to change the title if you can suggest better wording?
lewisflude 13y ago
Musicians make money from touring and selling merchandise primarily. This statistic is still quite interesting, it really puts it into perspective how little money there is for most artists to make on platforms like Spotify.
cliveowen 13y ago
A musician who relies on Spotify to make a living isn't a musician. In the music industry money comes from concerts, there's no way around it. Recorded songs are best thought of as marketing.
- tjr 13y ago
  A musician who relies on Spotify to make a living isn't a musician. How so?
  - jessaustin 13y ago
    Not a professional musician, anyway. As you imply, most musicians are never paid for their art, and that has always been true.
- whiddershins 13y ago
  Not long ago concerts could be loss leaders for album sales. These things aren't fixed arrangements.
- clicks 13y ago
  So, by that logic, the Beatles at about the time Revolver was released... were not musicians. Because, as you may or may not know, with the Revolver album they became a studio-only band. They neither wanted to play concerts (they were sick of playing concerts, started fearing getting shot, etc.) nor could they play because of limitations of live performance technologies at that time. But ignoring the Beatles for a moment, what about totally electronic music that's of a kind that can't be played live in any meaningful way? And what about people like me -- who have absolutely no interest in buying band t-shirts (I prefer wearing plain clothes) or attending live concerts?
  - jessaustin 13y ago
    Music is like any other content: very long-tail. The Beatles are big enough to do whatever the hell they want, and Spotify certainly can't stop them. In this modern age of disintermediation, it would be folly to arrange a content industry as if its most successful superstars were the typical case. To be fair, the music industry made a great deal of questionable money under that model for decades, but that time is over, and it's not hard to understand why. Similarly, the time of transition for the motion picture industry is coming, and they'll probably whine even more than the music people have.
  - rdouble 13y ago
    what about totally electronic music that's of a kind that can't be played live in any meaningful way? Electronic music is actually one of the best ways to make money as an individual artist because you can play both huge clubs and outdoor festivals, which attract hordes of people and you can play every night. I knew a minor rave celebrity in the 1990s (DJ ESP/Woody McBride) and he made over $1M every summer in Europe and then bought a house in the Minneapolis suburbs and retired to become a high school basketball coach. It seems like it would be even better now due to the sheer number of clubs and festivals. I follow Diplo on Instagram and he tours so much that he's making about $5M a year in the worst case scenario. In contrast, my cousin is a professional violist and he makes $400-$800 per day which is about the same as a mediocre Java programmer. Another way electronic artists make money is by selling their songs to be used in ads, movies and TV. Aphex Twin has had interviews where he admits that he made most of his money licensing his music to be used in TV ads around the world.
wmeredith 13y ago
This is from 2011. It's best to add a (2011) to the title in situations like these. It's a good topic and good info, but considering the speed at which music industry tech is evolving, the date of publication should have more attention.
jpswade 13y ago
Or just 6,929,156 for one week of the year, around Christmas time...
quadrangle 13y ago
Yeah, um, this assumes each stat to be the sole source of income, and to compare to minimum wage we must assume 40 hour work weeks. Anyway, if you can't make it as a musician, I guess you have to do something else productive. Corey Doctorow gets it when he describes himself and other people who make a living in creative arts as being in the 0.001%, the extremely lucky few who get to have that as their career. All professional musicians could disappear tomorrow and we'd still have enough great and varied music to listen to for all of anyone's lifetime and also have massive amounts of high quality participative music making by non-pros. Incidentally, I'm a semi-pro musician myself but I long ago stopped fighting the I-deserve-a-living-as-a-musician battle and switched to figuring out how to be sure my contribution to the economy actually mattered.
- whiddershins 13y ago
  Yes, your statement is accurate given that you don't think art or music need to evolve with culture. That they don't play a vital part in human evolution: spiritually, emotionally, culturally, philosophically. If so, yes, the music that has been made is more than enough. And we don't need any more music.
  - simias 13y ago
    That's not what he said. The point is that even if all pro-musicians disappeared there would still be enough non-pro/semi-pro to create new music in their spare time. After all, I doubt the first humans started playing music in order to pay the rent...
  - ahoy 13y ago
    That isn't at all what he said. He said that if people stopped making music professionally, people would still make music. Professional, commercial music is a relatively recent phenomenon. Music wouldn't stop existing if it stopped being sold.
  - vidarh 13y ago
    You completely miss the point: All professional musicians only account for a tiny fraction of actual music output. If they all disappeared it would not prevent art or music from evolving.
EdgarVerona 13y ago
This doesn't actually feel like an unreasonable number. Even a radio station with a small broadcast radius playing your song once could get that many people to hear it per day - I think people may be assuming that the value of a single person listening to a song once is worth more than it actually ought to be.
grahamburger 13y ago
Which is equivalent to what, one play per day on traditional radio? Maybe less?
earlz 13y ago
I don't think the world is ready yet.. but here is my idea on how to let artists make money in a fair manner without consumers paying too much. Imagine a clone of Spotify. You can do offline streaming and such for all the music in it. You pay $10/month for the privilege (which I think is fair). $5 or so goes to the company to maintain their servers and such. The other $5 though you can do interesting things with. Basically, each month you have $5 worth of "tip money". You can send however much money you want to whatever artist you want.. or you could alternatively setup other neat dynamic setups (the author gets 50 cents when you favorite his song, etc). .. The point being that it's under the user's control. And, if the user chose to not tip any artists this month(or they have left over tip money), then it's evenly split between all the artists they listened to for the month (depending on song count or whatever). This model I believe would work because the biggest thing standing in the way from giving your favorite band a tip is that it's through services that you are not already using. I don't want to go to their website and then sign up for paypal to give them a $1. The thing with this method payment is already accounted for. You already paid. Now you just get to pick which band deserves your money. This could even work with a free version by doing a model like for every 10 ads you must listen to in a month, you get 10 cents added to your tip money.. If I knew anything about the music industry, this would be the startup I'd be behind. This wouldn't work with the label model, and giving artists tips isn't really something I think most people would understand at this point... but some day... some day.
- ivasilov 13y ago
  A month ago, in a similar thread like this one, someone posted their side project [1]. It looks a lot like what you described. Sort of like flattr for musicians. Me personally, hope that it will get bigger exposure and gain traction. It seems like a viable model. [1] http://musiclove.rs/ http://musiclove.rs/
- saalweachter 13y ago
  That "totally fair" $10/month figure is the problem. Spotify's benefit to the consumer is they pay less for listening to the same music. Compare that to iTunes which doesn't save you any money, it just makes it a whole lot more convenient. (As an aside, I was far more appalled by the discrepancy between retail albums and iTunes albums: Both cost the consumer $10, but the label gets 5x more from iTunes while the artist gets slightly less than the $1 they get from retail.) You can save the consumer a certain amount of money by cutting out middle-men, but at the end of the day if consumers are paying less money the producers are earning less money. It only makes sense to the producers if it doesn't cannibalize their existing revenue streams.
confusedsquirel 13y ago
This was posted a few months ago. I asked a question then, that I will ask now. How much money does Spotify have to pay the record label? Usually the artist gets most of their money taken by the label. See here: http://www.salon.com/2000/06/14/love_7/ http://www.salon.com/2000/06/14/love_7/ and here: http://www.techdirt.com/articles/20100712/23482610186.shtml http://www.techdirt.com/articles/20100712/23482610186.shtml Record company math is very similar to movie studio math. Both systems are designed to make people very rich, just not the ones actually doing any of the work.
CoffeeDregs 13y ago
I find the graphic very misleading in that it mixes units. It seems very reasonable that price-per-album would be 10x the price-per-song since an album generally has about 10 songs on it. It also seems reasonable that price-per-song would be 50x price-per-play (using low-end royalty deal and Rhapsody payments) since, on average, I probably play songs about 50 times before I move on. So for synthesizing "replacing album revenue" the Rhapsody payments seem fair. "Replacing radio revenue" [ie. you don't control song order/flow] seems to be about 30% of "replacing album revenue" so Pandora is $3/month instead of $10/month. If the above is reasonable then Spotify seems well off the mark on pricing. Also, I don't understand why the label share is 80% of revenue.
gabriel34 13y ago
Although this number clearly states the unfeasibility of subsisting solely on Spotify plays of a few songs composed, it fails to translate this number to the present value of the expected plays throughout the years before the song becomes public domain. Such value would constitute a fraction of the payment the artist would get for composing those songs, since, as mentioned in another comment, "selling" your songs on Spotify does not require you to refrain from selling them elsewhere. Only given the sum of the present value of all the different passive sources of revenue the artist will get from a song and the time he spent writing it can we begin to compare his remuneration with the minimum wage.
- gabriel34 13y ago
  Other point I saw recently here at HN is that the recording companies get the lions share of the revenue that comes from recording because investing in a up and coming artist has a high risk, therefore must bring high profits to be a viable business model. Those business who don't milk the successful artists don't have money to take a chance with the up and coming artists while rewarding the investors at a competitive rate, which means they don't get investors for future growth. Other sources of money for a business include it's own money (which we established such a business wouldn't have) and loan (which require the business to have a higher return rate than the loan's interest).

24 points by callum85 13y ago

Not the best submission title. Spotify isn't mutually exclusive of the myriad other ways musicians can earn from their music online, many of which are described on this very same infographic.

callum85 13y ago
I thought that was clear from "...to earn minimum wage on Spotify". I'm happy to change the title if you can suggest better wording?

lewisflude 13y ago

Musicians make money from touring and selling merchandise primarily. This statistic is still quite interesting, it really puts it into perspective how little money there is for most artists to make on platforms like Spotify.

cliveowen 13y ago

A musician who relies on Spotify to make a living isn't a musician. In the music industry money comes from concerts, there's no way around it. Recorded songs are best thought of as marketing.

tjr 13y ago
A musician who relies on Spotify to make a living isn't a musician. How so?
- jessaustin 13y ago
  Not a professional musician, anyway. As you imply, most musicians are never paid for their art, and that has always been true.
whiddershins 13y ago
Not long ago concerts could be loss leaders for album sales. These things aren't fixed arrangements.
clicks 13y ago
So, by that logic, the Beatles at about the time Revolver was released... were not musicians. Because, as you may or may not know, with the Revolver album they became a studio-only band. They neither wanted to play concerts (they were sick of playing concerts, started fearing getting shot, etc.) nor could they play because of limitations of live performance technologies at that time. But ignoring the Beatles for a moment, what about totally electronic music that's of a kind that can't be played live in any meaningful way? And what about people like me -- who have absolutely no interest in buying band t-shirts (I prefer wearing plain clothes) or attending live concerts?
- jessaustin 13y ago
  Music is like any other content: very long-tail. The Beatles are big enough to do whatever the hell they want, and Spotify certainly can't stop them. In this modern age of disintermediation, it would be folly to arrange a content industry as if its most successful superstars were the typical case. To be fair, the music industry made a great deal of questionable money under that model for decades, but that time is over, and it's not hard to understand why. Similarly, the time of transition for the motion picture industry is coming, and they'll probably whine even more than the music people have.
- rdouble 13y ago
  what about totally electronic music that's of a kind that can't be played live in any meaningful way? Electronic music is actually one of the best ways to make money as an individual artist because you can play both huge clubs and outdoor festivals, which attract hordes of people and you can play every night. I knew a minor rave celebrity in the 1990s (DJ ESP/Woody McBride) and he made over $1M every summer in Europe and then bought a house in the Minneapolis suburbs and retired to become a high school basketball coach. It seems like it would be even better now due to the sheer number of clubs and festivals. I follow Diplo on Instagram and he tours so much that he's making about $5M a year in the worst case scenario. In contrast, my cousin is a professional violist and he makes $400-$800 per day which is about the same as a mediocre Java programmer. Another way electronic artists make money is by selling their songs to be used in ads, movies and TV. Aphex Twin has had interviews where he admits that he made most of his money licensing his music to be used in TV ads around the world.

wmeredith 13y ago

This is from 2011. It's best to add a (2011) to the title in situations like these. It's a good topic and good info, but considering the speed at which music industry tech is evolving, the date of publication should have more attention.

jpswade 13y ago

Or just 6,929,156 for one week of the year, around Christmas time...

quadrangle 13y ago

Yeah, um, this assumes each stat to be the sole source of income, and to compare to minimum wage we must assume 40 hour work weeks. Anyway, if you can't make it as a musician, I guess you have to do something else productive. Corey Doctorow gets it when he describes himself and other people who make a living in creative arts as being in the 0.001%, the extremely lucky few who get to have that as their career. All professional musicians could disappear tomorrow and we'd still have enough great and varied music to listen to for all of anyone's lifetime and also have massive amounts of high quality participative music making by non-pros. Incidentally, I'm a semi-pro musician myself but I long ago stopped fighting the I-deserve-a-living-as-a-musician battle and switched to figuring out how to be sure my contribution to the economy actually mattered.

whiddershins 13y ago
Yes, your statement is accurate given that you don't think art or music need to evolve with culture. That they don't play a vital part in human evolution: spiritually, emotionally, culturally, philosophically. If so, yes, the music that has been made is more than enough. And we don't need any more music.
- simias 13y ago
  That's not what he said. The point is that even if all pro-musicians disappeared there would still be enough non-pro/semi-pro to create new music in their spare time. After all, I doubt the first humans started playing music in order to pay the rent...
- ahoy 13y ago
  That isn't at all what he said. He said that if people stopped making music professionally, people would still make music. Professional, commercial music is a relatively recent phenomenon. Music wouldn't stop existing if it stopped being sold.
- vidarh 13y ago
  You completely miss the point: All professional musicians only account for a tiny fraction of actual music output. If they all disappeared it would not prevent art or music from evolving.

EdgarVerona 13y ago

This doesn't actually feel like an unreasonable number. Even a radio station with a small broadcast radius playing your song once could get that many people to hear it per day - I think people may be assuming that the value of a single person listening to a song once is worth more than it actually ought to be.

grahamburger 13y ago

Which is equivalent to what, one play per day on traditional radio? Maybe less?

earlz 13y ago

I don't think the world is ready yet.. but here is my idea on how to let artists make money in a fair manner without consumers paying too much. Imagine a clone of Spotify. You can do offline streaming and such for all the music in it. You pay $10/month for the privilege (which I think is fair). $5 or so goes to the company to maintain their servers and such. The other $5 though you can do interesting things with. Basically, each month you have $5 worth of "tip money". You can send however much money you want to whatever artist you want.. or you could alternatively setup other neat dynamic setups (the author gets 50 cents when you favorite his song, etc). .. The point being that it's under the user's control. And, if the user chose to not tip any artists this month(or they have left over tip money), then it's evenly split between all the artists they listened to for the month (depending on song count or whatever). This model I believe would work because the biggest thing standing in the way from giving your favorite band a tip is that it's through services that you are not already using. I don't want to go to their website and then sign up for paypal to give them a $1. The thing with this method payment is already accounted for. You already paid. Now you just get to pick which band deserves your money. This could even work with a free version by doing a model like for every 10 ads you must listen to in a month, you get 10 cents added to your tip money.. If I knew anything about the music industry, this would be the startup I'd be behind. This wouldn't work with the label model, and giving artists tips isn't really something I think most people would understand at this point... but some day... some day.

ivasilov 13y ago
A month ago, in a similar thread like this one, someone posted their side project [1]. It looks a lot like what you described. Sort of like flattr for musicians. Me personally, hope that it will get bigger exposure and gain traction. It seems like a viable model. [1] http://musiclove.rs/ http://musiclove.rs/
saalweachter 13y ago
That "totally fair" $10/month figure is the problem. Spotify's benefit to the consumer is they pay less for listening to the same music. Compare that to iTunes which doesn't save you any money, it just makes it a whole lot more convenient. (As an aside, I was far more appalled by the discrepancy between retail albums and iTunes albums: Both cost the consumer $10, but the label gets 5x more from iTunes while the artist gets slightly less than the $1 they get from retail.) You can save the consumer a certain amount of money by cutting out middle-men, but at the end of the day if consumers are paying less money the producers are earning less money. It only makes sense to the producers if it doesn't cannibalize their existing revenue streams.

confusedsquirel 13y ago

This was posted a few months ago. I asked a question then, that I will ask now. How much money does Spotify have to pay the record label? Usually the artist gets most of their money taken by the label. See here: http://www.salon.com/2000/06/14/love_7/ http://www.salon.com/2000/06/14/love_7/ and here: http://www.techdirt.com/articles/20100712/23482610186.shtml http://www.techdirt.com/articles/20100712/23482610186.shtml Record company math is very similar to movie studio math. Both systems are designed to make people very rich, just not the ones actually doing any of the work.

CoffeeDregs 13y ago

I find the graphic very misleading in that it mixes units. It seems very reasonable that price-per-album would be 10x the price-per-song since an album generally has about 10 songs on it. It also seems reasonable that price-per-song would be 50x price-per-play (using low-end royalty deal and Rhapsody payments) since, on average, I probably play songs about 50 times before I move on. So for synthesizing "replacing album revenue" the Rhapsody payments seem fair. "Replacing radio revenue" [ie. you don't control song order/flow] seems to be about 30% of "replacing album revenue" so Pandora is $3/month instead of $10/month. If the above is reasonable then Spotify seems well off the mark on pricing. Also, I don't understand why the label share is 80% of revenue.

gabriel34 13y ago

Although this number clearly states the unfeasibility of subsisting solely on Spotify plays of a few songs composed, it fails to translate this number to the present value of the expected plays throughout the years before the song becomes public domain. Such value would constitute a fraction of the payment the artist would get for composing those songs, since, as mentioned in another comment, "selling" your songs on Spotify does not require you to refrain from selling them elsewhere. Only given the sum of the present value of all the different passive sources of revenue the artist will get from a song and the time he spent writing it can we begin to compare his remuneration with the minimum wage.

gabriel34 13y ago
Other point I saw recently here at HN is that the recording companies get the lions share of the revenue that comes from recording because investing in a up and coming artist has a high risk, therefore must bring high profits to be a viable business model. Those business who don't milk the successful artists don't have money to take a chance with the up and coming artists while rewarding the investors at a competitive rate, which means they don't get investors for future growth. Other sources of money for a business include it's own money (which we established such a business wouldn't have) and loan (which require the business to have a higher return rate than the loan's interest).