How Streaming Saved The Music Industry

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how much do streaming services pay out to labels ?

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how many consumers pay for streaming subscriptions ?

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how much do artists get per stream ?

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how much do consumers pay for streaming subscriptions ?

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According to analysist, Spotify pays $0.00437 per stream for the label in 2016, this is down from $0.00521 in 2014, having fallen by 16%.

This number will expect to keep declining, as the more songs are streamed the fewer they will pay per stream.

Apple Music are generating the second largest amount of streaming revenue after Spotify, with a per stream rate of .00735 According to a Guardian report, the average an artist receives after the label or publisher have taken their cut is a mere $0.001128

100,000,000

0.00437

per stream

- Spotify, 2014

“We personally view ‘per stream’ metrics as a highly flawed indication of our value to artists . . .

We believe, however, that our service and the lives of artists will both be best if the world’s music fans enjoy more music than ever before in a legal, paid manner.”

+

£9.99

Spotify charges £9.99 per month, £4.99 for students.

As of July 2017, Spotify had 60 million paying subscribers worldwide, double what it had back in March 2016. And has over 140 million active users, which puts the free user base around 80 million.

Apple Music costs £9.99 per month, £4.99 for students.

Apple Music has over 30 million paying subscribers.

Deezer costs £9.99 per month, £4.99 for students.

Deezer has over 1.5 million paying subscribers.

Tidal costs £19.99 per month for the full subscription.

Tidal has over 4.2 million paying subscribers.

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how has streaming affected overall music sales ?

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how has streaming affected the global industry revenues ?

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how has it affected digital download sales ?

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what has it done for vinyl sales ?

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Because of the dramatic rise in streaming, the first six months of 2016 saw the sales of music drop by 13.6% (100.3 million album units) from the same period of 2015. This includes sales by CD, Vinyl and Digital Download.

+5.9%

In week 48 of 2016, only ÂŁ2.1m was spent on the digital download of albums.

The figures significantly contrast with the statistics that were recorded at this time last year, when digital downloads racked up ÂŁ4.4m worth of sales.

+5.9% global revenue growth +17.7% digital revenue

Over the same six-month period the public streamed 208.9 billion songs which is equivalent to 139.2 million album units, according to RIAA and Billboard Rules.

This is a 58.7% increase from the year before.

YouTube being the biggest online streaming service to increase in streams, 95.3 billion views as opposed to 2015s 76.6 billion.

The past 15 years has seen a 40% decline in revenue because of piracy, but for the second time in 2 years the industry has seen a well needed growth.

The streaming revenue went up 60% last year, $15.7bn in 2016.

Although physical revenues decreased in 2016 by 7.6%, vinyl sales have seen the highest UK total in 25 years. More than 3.2 million records were sold in 2016, a 53% rise on the previous year. However, vinyl still only accounts for 2.6% of the music market.

CD sales fell by 11.7% in the same period, although still accounts for just over 40% of total music consumption throughout the UK with 47 million units sold in the calendar year.

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have adverts become bias towards promoting streaming ?

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will free streaming be stopped in the near future ?

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whats being done to gain paying customers ?

As more and more people are signing up to pay for streaming services, the industry is starting to consider shutting down free streaming.

Music sites such as NME (New Musical Express) blog about new music everyday, every article has a bit of information on the artist and new release. As you would expect, each with a link to either the music on Spotify or Youtube, but not one mention of where it can be purchased on any of the articles.

A Mojo magazine from 2011 shows how much advertisement has changed in the past few years. Each advert has information regarding where the album can be bought, ‘available at HMV’.

There is no mention of HMV or any music outlets in the 2016 NME issue.

‘stream now on...’

In a statement, Spotify announced a new deal with record label Universal in April 2017.

The company announced they would limit new album releases for paying customers only for two weeks before putting the catalogue on the site for everyone.

Although physical sales are still dropping, music revenues have risen in the last two years.

It’s not necessarily a bad thing adverts have changed to promote streaming more.

‘This partnership is built on a mutual love of music, creating value for artists and delivering for fans.’

“If we have 100 million or 200 million paying subscribers, then you can probably afford to move away from ad-supported...”

‘We know that not every album by every artist should be released the same way, and we’ve worked hard with UMG to develop a new, flexible release policy.’

“At a certain point you can afford to shut it off, you can afford to say, ‘okay, no more free streaming’.”

‘Starting today, Universal artists can choose to release new albums on premium only for two weeks, offering subscribers an earlier chance to explore the complete creative work, while the singles are available across Spotify for all our listeners to enjoy.’

- Spotify CEO and Chairman, Daniel Ek

- Emmanuel Zunz, CEO of digital music distributor, oneRPM.

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