Myth 4: iTunes radio is like Spotify or Pandora!
FALSE
You don’t compare the radio in your car to your MP3 player, do you? Spotify is more like your MP3 player, except it has a gigantic library that streams from the cloud. You control what you listen to. You don’t control radio, other than the channel you select.
I find this comparison really frustrating.
Myth 3. Spotify gives 70% of the revenues to rightsholders, the exact same amount rendered by iTunes.
This misleading comparison ignores who’s receiving the money. Spotify is comparing what they give in total, not what all artists make individually.
iTunes downloads were upfront, no matter what song was downloaded. Buy the Neon Trees song for a $1? Buy a Mike Vial song for a $1? The same 70% goes to the artist/rights holder.
Streaming a Mike Vial song on Spotify doesn’t pay him the same rate as streaming a major label song because the labels worked out their own deal with Spotify, and we don’t know what that deal is.
An indie licensing through CDBaby does not get the same deal as say Rihanna through Def Jam.
Myth 2: A stream pays an artist $0.006
Not completely true. Not every stream pays the same rate.
For example, some people use Spotify for free and hear ads between songs. I’m assuming those types of streams don’t pay the same rate as other uses who pay the monthly or annual fee.
Also, a partial listen doesn’t pay the same rate. I’m guessing that one account streaming one song multiple times in a row doesn’t pay the same rate. So it gets tricky.
Here are some examples of Spotify stream pay rates I received for my song “Reaching Back”:
$0.00618899
$0.00095843
$0.00104792
Since the first day it was offered in the United States, I’ve been an early-adopter to using Spotify as a listener and musician with music available on the streaming platform.
I thought I’d spend some time this week debunking seven myths I’ve heard about Spotify. Click on the links below to read why these myths are false.
- A stream pays an artist 0.006 cents.
- A stream pays an artist $0.006
- Spotify gives 70% of the revenues to rights holders. The exact same amount rendered by iTunes.
- Spotify is just like iTunes Radio or Pandora
- It’s a promotional tool: Musicians were OK with songs being on the radio for low pay, so they should be OK with Spotify for low pay.
- Spotify is killing download and CD sales.
- You will make money from Spotify over the long term. It’s about the long tail!
