16 11 11

More controversy surrounds Spotify and streaming payouts

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Spotify has reacted angrily to an article on industry site Digital Music News with the headline ‘Study: Spotify is Detrimental to Music Purchasing‘. The story was based on the recent report from NARM and NPD Group on digital music, and embeds a couple of slides focused on whether access to music makes people less likely to buy it.

“Along with NARM, we’re confused by the way this research has been interpreted, since Spotify was not referenced anywhere in the research questionnaire and had only been live in the US for a matter of days when the study was carried out. The deck also makes absolutely no reference to Spotify and certainly does not draw any conclusions about Spotify, such as those made in the article,” a spokesperson tells Music Ally, citing data from Europe where in 2010, markets with Spotify saw an average digital growth rate of 43%, compared to 9.3% for Spotify-less markets.

However, back in Europe not every artist is on message. Drum’n’bass act Blu Mar Ten‘s distributor is pulling music from all streaming services due to revenue being “negligible and these services cannibalise revenue from the likes of iTunes”.

The statement claims that Q3 was its first full quarter supplying content to the streaming services, and that 1.) its iTunes revenue fell by 24%, 2.) streaming accounted for 82% of tracks consumed but only 2.6% of revenue, and 3.) that Spotify specifically paid £2,500 for 750,000 streams during the quarter.

Music Ally
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3 responses
  • Blu Mar Ten says:

    I’d just like to clarify that the comments “revenue being “negligible and these services cannibalise revenue from the likes of iTunes” were made by the distributor (ST Holdings) and not us.

    A number of the 238 labels from ST Holding’s roster have posted & tweeted the news, we just happened to be the ones who got picked up on. Not really sure why our name’s plastered all over these articles to be honest. We’re one of STH’s smaller acts!

    You can read the statement from ST Holdings here: http://www.stholdings.co.uk/2011/11/16/removal-of-content-from-spotify-simfy-rdio-napster/

  • Joel Kalsi says:

    It’s good to have your name there, “all publicity is good publicity” and I don’t think this publicity even is bad. I feel the same way about Spotify and the likes. People don’t neccessarily, or rather I’d say most likely ever, listen to every single track 250 times from Spotify to make the owners have their 0,99 euro share which would come from selling a single track for a single listener. Spotify clamps the value of music, and I don’t mean the monetary value, but the real value of the music itself.

  • Andrew says:

    Joel, your analysis “People don’t neccessarily, or rather I’d say most likely ever, listen to every single track 250 times from Spotify to make the owners have their 0,99 euro share which would come from selling a single track for a single listener” misses the point that many people might listen to a track several times that would never have bought it. I know I certainly do! In fact, according to my last.fm stats, two of my top 5 most listened to tracks are ones I never would have discovered, and therefore never would have bought without Spotify and Last.fm.

    Also missing from this point is that there are artists whose CDs I have bought, that I also listen to on Spotify, so not only have they had royalties from their original sale to me, they have also had royalties (however minor) through Spotify.Admittedly, I barely buy music anymore, I simply can’t afford it, and when I do it’s inevitably second hand sales, which does not benefit the artist anyway!

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