Music Streaming: Meet The New Benchmark, ‘A Million Plays A Month’January 30, 2013 5:06 am
Looks like the perfect consumption model for Music will remain elusive for quite a while. Just when the world seems to think that Streaming is the future, and Spotify seems to be well on its way to be the platform that everyone in the music industry wants to be part of, reports come in, basically saying that the platform does not work very well for the people creating the music (Source)
The challenge is this: it would take a huge number of plays, in the millions, to get the artist anything substantial in royalties. Here is an example from the NYTimes article: “After her songs had been played more than 1.5 million times on Pandora over six months, she earned $1,652.74. On Spotify, 131,000 plays last year netted just $547.71, or an average of 0.42 cent a play.” (Source) That is sad, to say the least. Forget the rent, it probably cannot pay your utility bills, inspite of ‘millions’ of plays on these platforms.
But here is how we can digest these stats – remember we had digested digital journalism stats in a similar manner – you basically need a million plays a month – like a million pageviews a month. Spotify generally pays 0.5 to 0.7 cent a stream for the paid tier, which results in $5,000 to $7,000 per million plays, not $5,000 to $8,000.
The summary is this: Music streaming is a tough game. If you are an artist, and you plan to make a living off streaming music online, you need to shoot for a million plays a month. At the very minimum, that is.