How Much Do Music Artists Earn Online? (2010)

http://www.informationisbeautiful.net/2010/how-much-do-music-artists-earn-online/

by callum85 • 13 years ago

24 49 13 years ago

incision• 13 years 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.

callum852• 13 years 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• 13 years 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• 13 years 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.

tjr2• 13 years ago

A musician who relies on Spotify to make a living isn't a musician.

How so?

jessaustin2• 13 years ago

Not a professional musician, anyway. As you imply, most musicians are never paid for their art, and that has always been true.

whiddershins7• 13 years ago

Not long ago concerts could be loss leaders for album sales. These things aren't fixed arrangements.

clicks2• 13 years 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?

jessaustin2• 13 years 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• 13 years 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.

tomjakubowski• 13 years ago

Because, as you may or may not know, with the Revolver album they became a studio-only band.

That's famously almost true ;)

http://www.youtube.com/watch?v=fFJFsyAAoZ4

wmeredith• 13 years 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• 13 years ago

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

quadrangle• 13 years 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.

whiddershins7• 13 years 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• 13 years 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• 13 years 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.

vidarh2• 13 years 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.

Natsu• 13 years ago

Sometimes I think that musicians need music more than the rest of us.

whiddershins7• 13 years ago

Right, i did ignore the part about amateur musicians and their contributions to the lexicon. To all you who replied, i propose an experiment: go one month listening only to amateur music, or no music at all.

Amateur, non commercial, music must be music made by people who do not now, and have never, made their living as professional musicians.

For just one month.

tjr2• 13 years ago

After some modest attempts and a fair bit of research, I concluded that creating [EDIT: recorded] music for people to enjoy listening to is almost certainly a horrible business plan.

That does not mean that it's a horrible activity; with modern technology, it's relatively easy for, say, a software developer to masquerade as a musician and crank out great tracks. Getting sales, though, is challenging, and getting enough sales to pay normal living expenses is very challenging. A lot of potential "customers" seem to increasingly not wish to pay to listen to music at all, whether if it was made by J. Random Hacker or The Beatles.

It seems more likely to be able to make money supplying production music: royalty-free tracks, custom music for productions, etc. But this isn't music create for the express purpose of people just listening to it; it's more utilitarian, something producers buy in the interest of creating another product altogether.

This might be the same path that software is on: lots of great software is available free of charge. It's presently still quite possible to earn a living selling software directly to individual consumers, but the long-term money may be in selling software to companies who use it to produce something else, and custom software development where off-the-shelf programs don't do quite what is needed.

In any case, I enjoy making music. I am open to opportunities to make money for doing so, but I expect to continue making music whether if I get paid or not.

kvcrawford2• 13 years ago

I liken it to open source software: the intellectual property isn't the business plan/revenue source—rather, it enables a business model surrounding that IP (touring).

Pretty Lights, for example, is achieving some great success releasing his own music and everything else on his label for free. If your music is more accessible, and people enjoy it, then ticket sales are sure to go up.

And on that note, yes it's a terrible plan if you're just setting out to make money: these artists have INSANE touring schedules. Their passion for the music is what keeps them going.

whiddershins7• 13 years ago

As a way to combat the exact analysis you just detailed, I developed the gralbum platform. My hypothesis is that we need a medium change, something designed for music which is actually meant to be listened to, and which can take the economic role of the LP or CD.

callum852• 13 years ago

Of course it assumes each stat to be the sole source of income, for the purpose of answering this question: how many plays on Spotify would it take for the fees to equate to one US minimum wage?

That's all this is, and that's fine. It would be weird for the author to start factoring in other sources of income, because the point of this story is simply to make it easier to understand what "$0.00029 per play" means, by its ratio to a more tangible figure. I don't think the author is trying to imply that all those musicians on Spotify with fewer than 4m plays/month are actually earning less than minimum wage overall.

EdgarVerona• 13 years 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• 13 years ago

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

earlz2• 13 years 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• 13 years 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/

saalweachter2• 13 years 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.

earlz2• 13 years ago

The "totally fair" figure isn't the problem. It's Spotify deciding that artists on the top 100 list should get paid substantially more per listen than some indie artist. No matter how good or bad the person on the top 100 is nor how good or bad the indie artist is. Also, some bands I would much rather tip with 50 cents than to give .2 cents for listening to them 5 times or whatever.

And yes, I'm of the general opinion that albums and songs that are /bought/ are overpriced... kind of. I don't care if I own my music. I care that I can listen to many different artists without having to buy $200 worth of albums to discover all their music.

TylerE• 13 years ago

You're ignoring price discrimination. Many who would pay $10/month for unlimited streaming would just go back to torrenting if you took their shiny toy away, they're NOT going to spend that $10 on iTunes instead.

AndrewDucker2• 13 years ago

I pay £10/month to Spotify.

I was not spending anything like £120/year on music for several years before I got my Spotify subscription.

GuiA• 13 years ago

$10 a month per user doesn't cut it. Spotify actually makes more money off free users than paying users, because the ad placement they achieve for free users is worth more than $10/month/user. In reality, it's their interest to keep the free user/paying user ratio to a certain zone, or they'd be losing too much money.

21echoes• 13 years ago

this is actually exactly how Google Play works (http://play.google.com/intl/ALL_ALL/about/artist-terms.html). The numbers aren't as clean and simple as "pay 5 to us, 5 wherever you want", but effectively what's happening when you pay those $10 is that it's split proportionally over the artists you listen to by the number of times that you listen to them that month.

confusedsquirel• 13 years 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/ and here: 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• 13 years 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.

gabriel342• 13 years 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.

gabriel342• 13 years 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).

How Much Do Music Artists Earn Online? (2010)

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