How long can music companies be in the red?
Streaming sites are inevitably the future (actually the present), but will they be inevitably profitable as companies?
Here’s a rundown of some streaming companies’ profitability:
- Rdio went bankrupt and sold off a portion of its assets for $75 million to Pandora last year. (As a songwriter, I was never was paid any royalties in 2015, by the way, even though I was paid some small royalties in 2013 & 2014.)
- Pandora spent $75 million on assets of Rdio, but “[i]ts revenue growth rate keeps increasing as its income keeps falling.”
- Hypebot reports that Soundcloud reported a $56.5 million loss in 2014. Update: Soundcloud’s end near?)
- Spotify is bringing in a large amount of money each year, but it still doesn’t turn a profit after being in the United States since 2011.
- Google’s just about breaking even with Youtube.
While I understand a need for investment before a company hits its stride, as of 2016, I’m scratching my head wondering if this system is working for anyone other than the grazing consumer.
Oh, and the CEOs in their 14 bathroom mansions.
Bandcamp and Patreon might be the only companies that really put creators first.
But the public hasn’t embraced these companies in larger numbers as it has Spotify, Pandora, iTunes (now Apple Music) and Youtube; and the obvious reason for this is the major labels’ artists aren’t found on these sites built on Indie-creed. Popularity breeds popularity.
But this time, popularity is not breeding sustainability.
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