Spotify Royalty discussion

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fluffy
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Re: Spotify Royalty discussion

Postby fluffy » Sun Dec 20, 2015 5:02 pm

Well, yeah. Are we just talking in circles here? I don't think anyone disputes what you said originally.
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Re: Spotify Royalty discussion

Postby Lunkhead » Sun Dec 20, 2015 7:43 pm

My whole point was that Spotify may not be the ones making the decision to do things that way. Can you point to any public documentation that indicates that Spotify is doing it that way because they chose to and not because that was imposed on them by the record labels? I can say from close second-hand experience that in the current climate the labels still hold the upper hand when it comes to making deals to license their content to streaming services, so to me it seems more likely that the inequity is coming from the labels. You may be trying to tell Spotify to change things in a way that would violate their licensing deals with the labels, so, they're not going to do that. So you may want aim upstream a bit, is all I'm trying to say.
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Re: Spotify Royalty discussion

Postby Lunkhead » Thu Feb 04, 2016 10:52 am

Warner Music has said publicly now that, if their equity stake in Spotify ever becomes worth something, they "promise" to share that with their artists:

http://recode.net/2016/02/04/warner-mus ... s-artists/

Although, according to the article, the payout will follow the same split rules as are used to split the payout from streams. Doh!

That’s interesting. But unless you’re a very, very, very popular artist, like Warner’s Coldplay, it’s unlikely to mean a lot, since Warner will use the same payment formula it uses to pay artists for the use of their music today, which is based on usage.


Better get to lobbying the labels for a more fair payment formula before Spotify goes public!

In Pandora's case, I haven't heard about our deals if they involve any kind of equity stake. It seems like that would potentially be more complicated because we're public already. But because we're public I assume that any shares going to labels would have to be reported to Wall Street at least.
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Re: Spotify Royalty discussion

Postby roymond » Thu Feb 04, 2016 11:34 am

I have been out of this game for a couple years, but most payments from streaming, broadcast, tours and other forms of performance (something is considered a performance when someone hears it, regardless of the method the noise was produced as opposed to a download or CD/DVD sale) are made to the various performing rights organizations (PROs) like ASCAP, BMI, SESAC, SoundExchange, etc. based on blanket agreements. In turn, the PROs gather the pool of money from all their various revenue streams (those blanket agreements and licensing fees) and distribute royalties 50-50 to songwriter rights and publisher rights according to a weighted secret sauce that considers performance types in all the various forms of reporting they analyze. Both songwriter rights and publisher rights are marketable and therefore can be bought and sold (thus Michael Jackson owned half the Beatles' catalog at one point). Pandora and Spotify don't pay artists directly unless there's some direct contract between them (very very rare), however they may report the per-artist shares they report to PROs. Most all of this is federally legislated.

Here's a good overview of PROs and stuff: http://diymusician.cdbaby.com/musician- ... dexchange/
To help see how disparate one's royalties will be compared to someone else read this: http://www.ascap.com/members/payment/royalties.aspx

The labels dictate how the artists are paid and the split. Most artists sign away their rights by way of up-front loans to record and produce the album. Also, the PROs divide among many the artists' payments including ex-wives and child support claims! In the end there's no getting around the fact that it's broken and needs to be completely overhauled. So HOLD YOUR BREATH, they'll fix it soon! hahahahahahahahahahaha

I don't really know how this impacts indie artists on indie channels that work outside the establishment.
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Re: Spotify Royalty discussion

Postby fluffy » Thu Feb 04, 2016 12:03 pm

I get money both from ASCAP and from my distributors (CDBaby and DistroKid, depending on which album). It's complicated and weird.
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Re: Spotify Royalty discussion

Postby jb » Thu Feb 04, 2016 12:56 pm

Still pissed at the streamers. They are making deals with the labels-- allowing the labels to dictate terms for payment that cause their clients to steal from others who aren't on the labels, because they know that indie artists can never make up the difference in popularity.

Basically, if it were ONLY label artists on the streaming services, I wouldn't care. But it's not, it's me and you, and they know it's not fair and because streaming is so seductive a use case, nobody cares.

I suppose it hardly matters. Not like the copyright for the Beatles is going to go away any time soon, and as long as there are players that heavy, the gnats like us are gonna get swept aside no matter how big a cloud we form.

Don't have to like it though!

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Re: Spotify Royalty discussion

Postby ken » Thu Feb 04, 2016 3:39 pm

I think if you want a different system, you have to build one. Isn't that the promise of the internet? Make your own streaming service where artists get paid per individual stream and see what happens!
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Re: Spotify Royalty discussion

Postby fluffy » Thu Feb 04, 2016 4:01 pm

The difficulty seems to be in attracting users who are going to want to pay just for independent content on a monthly basis. Magnatune was trying this sort of thing for a while but they don't seem to do it anymore, for example (but they seem to be flailing about trying to figure out what they CAN be profitable at now).

I think a successful model could be in the form of "pay us based on the amount of time you listen, we pass 70% along to each artist you listen to based on total streaming time" instead of being based on a monthly thing. Maybe there could be curated/shared playlists. And a simple recommendations system. Hmm. I'd certainly sign up for something like that. Not sure listeners would be so into it though. It'd have to be pretty price-competitive with Spotify, like, assume the average Spotify user listens for 10 hours a month (total pulled-out-of-my-ass) then that's $1/hour, which seems kind of steep? Maybe?
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Re: Spotify Royalty discussion

Postby ken » Thu Feb 04, 2016 5:16 pm

So some kind of Uber-ish payment plan for streamable music? Pay as you go?

Oh, with surge pricing so if a song is a hit it becomes more expensive to listen to!
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Re: Spotify Royalty discussion

Postby fluffy » Thu Feb 04, 2016 5:55 pm

Well, if you want to come up with evil ideas, that would certainly be one of them.
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Re: Spotify Royalty discussion

Postby Lunkhead » Thu Feb 04, 2016 7:05 pm

JB, have you tried Tidal? They claim to have the highest payouts to artists. If that's important to you can vote for it with your dollars.

https://en.wikipedia.org/wiki/Tidal_(service)

I'm going to sound like a broken record here, but I still believe the labels are most responsible for the biggest/worst problems in how money goes from consumers to artists. That has always been the case! I don't think it magically changed when streaming services appeared.

https://www.techdirt.com/articles/20150 ... ists.shtml

What Jay-Z really ought to do is start a label with all his titanic musical partners in Tidal and cut deals with Spotify and Apple and Google, etc. That might really shake things up. Artists like that don't really need the labels for marketing or distribution or financing anymore. They could start trying to institute some real change in the industry.
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Re: Spotify Royalty discussion

Postby roymond » Sat Feb 06, 2016 1:59 pm

Back in the 90s folks were pushing for a pennies-per surcharge on blank media, the revenue from which would have dwarfed the industry's best case scenarios and essentially make music free while paying substantially more to artists and enabling tremendous innovation in distribution and consumption. But then that would have prevented the untold hours and monies spent prosecuting grandmas and bringing down Napster.
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Re: Spotify Royalty discussion

Postby fluffy » Sat Feb 06, 2016 2:18 pm

That ended up happening in Canada, but they still spent lots of time and money prosecuting grandmas and bringing down Napster. The industry sure loves to double-dip.

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