Published on August 5th, 2018 |
by Alan Cross
One more time: You cannot equate money made from STREAMS with money that came from SALES. Here’s why.
David Crosby is mad about the money he’s making from streaming.
Peter Frampton is upset, too.
*Sigh* Neither one of them gets it. A million streams is NOTHING. Neither is 55 million streams.
Let’s look at it this way for the benefit of Mr. Crosby.
A song gets played ten times on the radio in ten different cities across the continent. Let’s say that with each play, the song is exposed to 100,000. In other words, ten plays of the song reaches a million listeners. A million listens, in other words.
The payout for this? Pennies. Literally pennies.
But over weeks and months, those pennies add up, especially if you have several songs that make it on the radio. The results are nice cheques from SOCAN, ASCAP, BMI, SESAC and other performing rights organizations.
Now let’s switch to streaming.
A song gets streamed a million times (i.e. is heard by the same number of people as in the example above) EXCEPT that we’re dealing with a million individual listens instead of a million group listens.
Payout? A few bucks, which, in many territories can HIGHER than radio airplay while delivering the same number of ears.
Crosby is conflating streams with sales. Apples and oranges. Streaming is essentially ultra-individual radio and not the same as selling records, CDs and digital downloads.
And if Crosby and Frampton have issues with the royalty rates being paid for streaming, they need to take it up with their record labels. Spotify, Apple Music, YouTube Music, Deezer, and all the rest of them pay out what’s demanded by the labels. They get the cheques from the streamers and then distribute fees to the artists.
The labels, then, act as middlemen, proprietors of a big, black box where the money gets dumped on the way from the streaming companies to the artists. How much money goes to the artist is determined by the terms of their deals, not at the discretion of Spotify or whoever.
And yes, those payouts can be pitifully small–extra small if you’re under the impression that streaming should pay as much as record sales.
Once again, streams are not the same as sales and will never will be. Got a problem with those Spotify cheques? Talk to your label which is probably taking at least 50% of that streaming revenue before it passes anything on to you.
Another look at the situation is available here