He says spotify give 75% of the revenue back but it goes to labels and labels choose to only pay artists 10-15%. That’s incredibly self-serving and disingenuous and I think factually untrue in the case of small artists in particular.
Firstly Spotify have huge market power which they could easily use to benefit artists if they cared about it. They could bake in to their deals with labels a minimum cut for artists and labels would have no option but to pay this. They don’t do this even though there would be basically no downside to them which suggests they don’t care about it.
Secondly in the cases I know about directly (which are small artists on independent labels often that they own themselves) the amount spotify pays per stream is derisory. They own the label so are getting 100% of the cut from spotify, but the actual amount is just tiny. Spotify could easily rebalance the scale such that small artists are supported. Again this wouldn’t hurt them but they don’t do it.
The real reason that artists get paid so little is that sharks like spotify (and the labels too) feel they can get away with it, which largely and very sadly appears to be true.
Yea presently a new technology benefits consumers because essentially it makes something previously more expensive now cheaper, but just like Netflix once the contracts all expire the artists and labels will say, we want more money — so suddenly Spotify premium will cost more money and the spotify non premium will have even more ads.
However, he doesn't address the disparity BETWEEN LABELS on Spotify. Some labels have much sweeter deals, and that's considering aggregators already, I mean at the raw-play-count level, some get a bigger portion than others.
"Spotify pays [rights holders] between $0.003 - $0.005 per stream[1]" - let's take $0.004.
Assuming an album costs $10 to the customer, with approximately a 5% sales tax[2] and 25% margin[3], and there are 10 tracks per album, the nominal comparative cost per track is somewhere around $1-0.75/track.
That means that the 'break even' point between Spotify and buying an album is around 200-250 listens.
I think this is a bit on the high side, but bear in mind that this doesn't take into consideration that a) those 200-250 listens may be spread across multiple owners of a CD (if it's sold as second-hand), b) Spotify encourages people to listen to music that they otherwise would not have bought, c) Spotify monetises otherwise 'free' listens, whether it be radio, LimeWire, etc.
Spherical cows in a vacuum, etc., but on balance I think that 200-250 listens to a track is not a bad break even point.
[1]: https://dittomusic.com/en/blog/how-much-does-spotify-pay-per...
[2]: https://worldpopulationreview.com/state-rankings/sales-tax-b...
[3]: https://howtostartanllc.com/business-ideas/record-store