I've written this article to post on producer/engineer forums. I'm assuming there are plenty of people like myself, independent musicians who produce their own music and hope to make money doing so. The point of this is that there has to be a change in the music industry, or we'll all have to be in ads. There was no condescension meant by this article, I just wanted to be clear because it's a confusing topic. Also I'm not selling anything.
First I want to say that musicans aren't really in competition with one another for listeners. Myself for instance, I'm a fan of and have bought music from probably upper hundreds or more than a thousand musicians. I love Motorhead and I love Fetty Wap, they're not mutually exclusive. So it's not other musicians and producers who are a barrier to making money, not that much.
Secondly the idea that a musician shouldn't be compensated for their work, is wrong. Music is great. It's addictive, like a drug. It helps people emotionally, which is invaluable. It's the freaking soundtrack of life, without it, movies would be boring, dancing would be dumb, and the news wouldn't be as terrifying. Just think about it.
Why is it so hard to sell music. It's not, in this day and age it is very easy to make money from music. The problem is other people are using your music to make money, you're not getting paid because you've basically paid them to take it for free.
If you're a recording musician, not affiliated with a label, you have a few options to sell music in the market or the internet, excluding traditional set up shop and sell things from a table. Those options are pay to distribute, like cd baby, or tunecore etc. Those companies take your money to sell or give away your music, on large platforms like spotify, itunes and a host of other sites.
The platforms, not only sell your music but also sell ads. The reason that you can make money from your music online, is because your music is considered "content", so is this forum. Let's take this forum as an example, it's free to come here and write down whatever you're thinking, that might be bullshit, but it might be extremely valuable information. If you look to the right or left there are targeted ads, targeted to people like you who make music. The company who sells whatever product is in this ad, pays this site each time you click on the ad or view the page, depending. So each time you do, the site makes 25 cents est. If you've ever started a thread in a forum you've created a whole page of content, that in turn makes them money 24 hours a day. If you're thinking you should make a website and create content in order to place ads and make money, you will have gone the way of many other musicians, good luck.
Music is even better content. So imagine you've created music, you've mastered your instruments, you've read all the manuals and bought thousands of dollars worth of equipment and learned to use it and now you're album is done and you're going to try to sell it. You need exposure. If you can't tour for some reason, like you have a job, and need to eat or some lousy excuse like that (just kidding), your avenue for exposure and profit is the internet. The problem with music is that the music is the ad for the music. So you have to let people listen to it in order for them to decide if they want to buy it. So if it were just that simple it would be great and this is why touring is so effective if you want to do that.
So exposure services like spotify and pandora, in one sense are great because musicians and listeners are united in a blissful uncomplicated relationship. On the other hand, those companies eliminate any reason to buy music, ever. So right now I'm looking at spotify, and it is wonderful. I never need to go anywhere else to listen to music, ever. If someone's not on spotify I will never know, because I am so entertained by this.
If I listen to the artist Travi$ Scott for instance on Spotify, and I love him so much I listen to him 10 times a day, he earns .022 cents a day. If I'd listened to him on pandora or iheart radio accidentally at that same rate he'd make .017 cents. This is because on sites that allow you to choose which songs you listened to the company has to pay .0022 cents per listen, and for sites that play like the radio they pay .0017 cents per listen. The copyright royalty board or CPB sets royalty rates, these are the minimum rates for webcasting music, and this is stuck for the next four years.
So for every dollar that's made by an artist on Pandora, iHeart radio, Jango, or Slacker their song has been played by me 588.23 times, if the song was three minutes. For Spotify, a dollar is made by getting played 454.54 times. Some of these rates are different I know, for musicians who have the clout I guess to get paid more, or a lawyer.
There are sites that sell songs, and those sites pay pretty reasonably, sometimes, I think itunes sells at .67 cents a song or that's what you get after the distributor takes their cut. That's pretty reasonable, because you're selling to one person who will listen as many times as they want and that's great. But why would I ever buy music at all if my radio is my computer and my cell phone is my portable and car radio, and it's all free? I won't. After Taylor Swift's exit from Spotify their listenership increased by 2.5 million people.
Let's look at it from the other side. Advertisers are thrilled with pandora and Spotify because they provide rich engaging content at an affordable price. And new streaming services are arising, Amazon etc. Pandora typically shows seven display ads per listener hour and runs 2.5 audio ads (of 15- or 30 seconds) per hour. Users might also see a video ad. Visual ads, on a CPM (cost per thousand impressions)basis, sell for $5-$7; audio ads, $8-$12; and video ads, $15-$25. Spotify I couldn't find the exact math, they charge about 10-30 dollars per thousand impressions and take in about 150,000 dollars an hour in ad revenue total.
So to be fair, let's look at a typical hour on pandora as $.08 per listener, pretty generous. (Thats a median amount for each ad area divided by a thousand (CPM) added together) That means that for every dollar you make as a musician Pandora makes 47.05 dollars, not that bad.
What is Pandora really? Its a website, that took a lot of work by programmers and marketers, it's a rainbow really, that occupies 5 floors of a skyscraper. A beautiful idea, about liberating music and a free wonderful listening experience for consumers combined with low cost advertising. I mean it does not get any better than that. And Spotify, those Swedes are fing geniuses.
The fact is the product that they are selling to consumers is your music. Your music makes up the backbone of an entire multibillion dollar streaming industry that you humbly pay someone to allow you to be part of.
What I'm getting at here is that musicians have a low self valuation. Much lower than is reasonable. Not that we should become dicks and make popular music any meaner than it already is, I'm not advocating that. But the idea that some of these services are offering us a handout, or 'giving' musicians something is not true. What's actually happening is that musicians are giving them something, and they, are selling it again for billions of dollars.
We've actually collectively fallen under an advertising spell, where we really love these corporations, and strangely, feel sorry for them and want to help them. If you watch the news about Spotify and Pandora for instance, say around the CPB case, these streaming companies complain that they don't have enough money, that they are not actually doing that well. They make musicians out to be selfish and greedy for wanting to make money themselves, because they don't manage their money well and don't want to offend the advertisers by charging more. They have the money to project their brand to consumers as a free awesome service, to musicians as great way to gain exposure, and to investors as a successful profitable corporation. I assure you their money problems are their fault. Their business model is based on music being worth nothing, and really that they should be paid to take it away. So when you're listening to them complain about not having that much money and not being able to pay, and you're starting to feel guilty, just stop.
One way to change the services outside of yelling about it is if their catalog was diminished significantly enough and people just began to go elsewhere, because they would. If enough musicians pulled their catalog's Spotify and Pandora wouldn't have anything to sell, and they would have to reconsider their payment practices or their services would go away. On a sidenote pirating is actually getting harder and harder because the internet is getting more and more regulated. So if the industry reverted to the sale of mp3s or wavs, this time that might work, not that it should revert, I don't know.
That's all I have to say, thank you.
First I want to say that musicans aren't really in competition with one another for listeners. Myself for instance, I'm a fan of and have bought music from probably upper hundreds or more than a thousand musicians. I love Motorhead and I love Fetty Wap, they're not mutually exclusive. So it's not other musicians and producers who are a barrier to making money, not that much.
Secondly the idea that a musician shouldn't be compensated for their work, is wrong. Music is great. It's addictive, like a drug. It helps people emotionally, which is invaluable. It's the freaking soundtrack of life, without it, movies would be boring, dancing would be dumb, and the news wouldn't be as terrifying. Just think about it.
Why is it so hard to sell music. It's not, in this day and age it is very easy to make money from music. The problem is other people are using your music to make money, you're not getting paid because you've basically paid them to take it for free.
If you're a recording musician, not affiliated with a label, you have a few options to sell music in the market or the internet, excluding traditional set up shop and sell things from a table. Those options are pay to distribute, like cd baby, or tunecore etc. Those companies take your money to sell or give away your music, on large platforms like spotify, itunes and a host of other sites.
The platforms, not only sell your music but also sell ads. The reason that you can make money from your music online, is because your music is considered "content", so is this forum. Let's take this forum as an example, it's free to come here and write down whatever you're thinking, that might be bullshit, but it might be extremely valuable information. If you look to the right or left there are targeted ads, targeted to people like you who make music. The company who sells whatever product is in this ad, pays this site each time you click on the ad or view the page, depending. So each time you do, the site makes 25 cents est. If you've ever started a thread in a forum you've created a whole page of content, that in turn makes them money 24 hours a day. If you're thinking you should make a website and create content in order to place ads and make money, you will have gone the way of many other musicians, good luck.
Music is even better content. So imagine you've created music, you've mastered your instruments, you've read all the manuals and bought thousands of dollars worth of equipment and learned to use it and now you're album is done and you're going to try to sell it. You need exposure. If you can't tour for some reason, like you have a job, and need to eat or some lousy excuse like that (just kidding), your avenue for exposure and profit is the internet. The problem with music is that the music is the ad for the music. So you have to let people listen to it in order for them to decide if they want to buy it. So if it were just that simple it would be great and this is why touring is so effective if you want to do that.
So exposure services like spotify and pandora, in one sense are great because musicians and listeners are united in a blissful uncomplicated relationship. On the other hand, those companies eliminate any reason to buy music, ever. So right now I'm looking at spotify, and it is wonderful. I never need to go anywhere else to listen to music, ever. If someone's not on spotify I will never know, because I am so entertained by this.
If I listen to the artist Travi$ Scott for instance on Spotify, and I love him so much I listen to him 10 times a day, he earns .022 cents a day. If I'd listened to him on pandora or iheart radio accidentally at that same rate he'd make .017 cents. This is because on sites that allow you to choose which songs you listened to the company has to pay .0022 cents per listen, and for sites that play like the radio they pay .0017 cents per listen. The copyright royalty board or CPB sets royalty rates, these are the minimum rates for webcasting music, and this is stuck for the next four years.
So for every dollar that's made by an artist on Pandora, iHeart radio, Jango, or Slacker their song has been played by me 588.23 times, if the song was three minutes. For Spotify, a dollar is made by getting played 454.54 times. Some of these rates are different I know, for musicians who have the clout I guess to get paid more, or a lawyer.
There are sites that sell songs, and those sites pay pretty reasonably, sometimes, I think itunes sells at .67 cents a song or that's what you get after the distributor takes their cut. That's pretty reasonable, because you're selling to one person who will listen as many times as they want and that's great. But why would I ever buy music at all if my radio is my computer and my cell phone is my portable and car radio, and it's all free? I won't. After Taylor Swift's exit from Spotify their listenership increased by 2.5 million people.
Let's look at it from the other side. Advertisers are thrilled with pandora and Spotify because they provide rich engaging content at an affordable price. And new streaming services are arising, Amazon etc. Pandora typically shows seven display ads per listener hour and runs 2.5 audio ads (of 15- or 30 seconds) per hour. Users might also see a video ad. Visual ads, on a CPM (cost per thousand impressions)basis, sell for $5-$7; audio ads, $8-$12; and video ads, $15-$25. Spotify I couldn't find the exact math, they charge about 10-30 dollars per thousand impressions and take in about 150,000 dollars an hour in ad revenue total.
So to be fair, let's look at a typical hour on pandora as $.08 per listener, pretty generous. (Thats a median amount for each ad area divided by a thousand (CPM) added together) That means that for every dollar you make as a musician Pandora makes 47.05 dollars, not that bad.
What is Pandora really? Its a website, that took a lot of work by programmers and marketers, it's a rainbow really, that occupies 5 floors of a skyscraper. A beautiful idea, about liberating music and a free wonderful listening experience for consumers combined with low cost advertising. I mean it does not get any better than that. And Spotify, those Swedes are fing geniuses.
The fact is the product that they are selling to consumers is your music. Your music makes up the backbone of an entire multibillion dollar streaming industry that you humbly pay someone to allow you to be part of.
What I'm getting at here is that musicians have a low self valuation. Much lower than is reasonable. Not that we should become dicks and make popular music any meaner than it already is, I'm not advocating that. But the idea that some of these services are offering us a handout, or 'giving' musicians something is not true. What's actually happening is that musicians are giving them something, and they, are selling it again for billions of dollars.
We've actually collectively fallen under an advertising spell, where we really love these corporations, and strangely, feel sorry for them and want to help them. If you watch the news about Spotify and Pandora for instance, say around the CPB case, these streaming companies complain that they don't have enough money, that they are not actually doing that well. They make musicians out to be selfish and greedy for wanting to make money themselves, because they don't manage their money well and don't want to offend the advertisers by charging more. They have the money to project their brand to consumers as a free awesome service, to musicians as great way to gain exposure, and to investors as a successful profitable corporation. I assure you their money problems are their fault. Their business model is based on music being worth nothing, and really that they should be paid to take it away. So when you're listening to them complain about not having that much money and not being able to pay, and you're starting to feel guilty, just stop.
One way to change the services outside of yelling about it is if their catalog was diminished significantly enough and people just began to go elsewhere, because they would. If enough musicians pulled their catalog's Spotify and Pandora wouldn't have anything to sell, and they would have to reconsider their payment practices or their services would go away. On a sidenote pirating is actually getting harder and harder because the internet is getting more and more regulated. So if the industry reverted to the sale of mp3s or wavs, this time that might work, not that it should revert, I don't know.
That's all I have to say, thank you.
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