Here’s an interesting contribution to the streaming-music / artist payouts debate from economist David Touve, in his latest Rockonomics blog post digging into the numbers around such payouts.
Based on data from PPL and the BBC, as well as RAJAR estimates of UK radio listening audiences, Touve has been calculating the “spin value” of a track being played on the radio, versus the payout an artist gets from Spotify streams.
“I estimate the value of a single radio “spin” to a single listener in the UK to be £0.000073 (or $0.00012). Alternatively stated, the value of a “spin” to an audience of 1,000,000 listeners is about £73 (or $120),” writes Touve.
“For comparison, I believe the value estimated above is 1/36th the rate reported by Zoe Keating ($0.0042) for her receipts from streaming music services (e.g., Spotify), 1/10th the rate ($0.0011) paid by Pureplay Webcasters in the US (e.g., Pandora), and 1/18th the CRB-established default Webcaster rate ($0.0021) in the US.”
Spotify paying out 36x the rate of terrestrial radio, when considered per-play per-listener? That should put some more cats among the already-can’t-swing-a-cat-without-hitting-17-cats pigeons when it comes to the streaming royalties debate.
The challenge for Spotify, though, is that radio is seen by artists as a promotional medium – one that provides them with income, but which also promotes sales of their music through other channels. For those who have been critical of Spotify, their fears that streaming may cannibalise those sales likely won’t be assuaged by a straight comparison of this type.
Touve’s post is still another useful contribution to the debate, though. Now, to find some hard data showing Spotify’s impact on download sales for specific artists, for better, worse or same…