The debate over streaming music royalties continues to rumble, but the latest contribution is academic rather than argumentative. Washington & Lee University’s David Touve has published a blog post trying to get to the bottom of the respective values of an iTunes download and a Spotify stream.
It’s fascinating reading, because Touve has tried to level the playing field on which the two services are being compared. “Comparing the value of a stream to the value of a sale is without question an Apples to Oranges comparison. And so, let’s convert the sale to an estimate of payment per stream so we can compare apples to apples (or oranges to oranges if you prefer).”
He goes on to make an assumption – which in the comments section of the post he admits is a “potential weak link” – that a single track purchased from iTunes will be listened to 250 times on average over the lifetime of the purchaser. Based on a royalty share of $0.70 to be divided among the label, artist, songwriter(s) and publisher(s), that would mean $0.0028 per listen.
Touve then points out that based on the artists who have been disclosing their Spotify figures, the average per-stream payout (again, to the label, artist, songwriters and publishers) is around $0.0033.
“Could it be true? Is the per stream rate paid by music services actually greater than the effective per listen rate we pay for a purchased download?” asks Touve, before promising another post to come comparing the value of these two payments up-front and over time.
But as Touve admits, this all hinges on that assumption of 250 plays on average of iTunes downloads over the lifetime of their purchasers. Hard data on this is by definition impossible to come by: iTunes only launched in April 2003. Touve’s analysis is a valuable contribution to the debate, but it’s unlikely to settle it.