The richest songwriters of all time fall under this category. On the other hand, the crème de la crème are those individuals who are both singers and songwriters. These two categories of people rely on each other to make a kill in the music industry. Some amazing songwriters have never sung even one song while there are also very talented singers who have never written even one song. While many can successfully write pieces that are musical masterpieces, turning them into a lucrative business is a whole different thing. Perhaps most importantly, it will ensure that fans feel that their listening habits are directly connected to the success of their favorite artists.There is no shortage of creative and talented songwriters in this world. It seems more fair, and as computing power improves, it will become less expensive to manage. Many in the music industry think that a user-centric system is still the way to go. Figuring out the share of each user’s streams that went to each artist is much more computationally intensive, and thus expensive, than just summing up all the streams. A paper co-written by Spotify’s Director of Economics suggests that implementing a user-centric model would be so expensive to manage that it might reducing overall revenues for artists (pdf), outweighing the benefits of a more equal distribution. Yet even if user-centric payment is in some ways more fair, it still might not be a good idea.
Some big artists, like Taylor Swift, may increase their share of revenue, and some smaller ones will lose out. (Jazz is also hurt by the fact that Spotify pays by stream, rather than by minute of listening, since jazz tracks tend to be longer than most other genres.) But like the Finnish study, the impact is varied.
Hunt says that Apple found some artists making music on the “fringes,” like jazz, would gain. Deezer, a French streaming service with 7 million subscribers, announced that it is may move to a user-centric model, and has encouraged other streaming services to do the same.Ĭrispin Hunt, head of the British songwriting group The Ivors Academy, claims that Apple Music has also explored user-based payments. Some music streaming services are considering making the switch. The data Spotify provided were anonymized so the researchers could not identify trends in which types of artists did better. Though smaller artists ended up better off in aggregate, not all smaller artists gained-in fact, some were worse off. The research found that in the current system the top 0.4% of artists get around 10% of all revenue, but they would only get about 5.6% of revenue under a user-centric system. If everybody spent the same amount of time listening to music, pro-rata and user-centric systems would result in exactly the same outcome.Ī 2017 study conducted the Finnish Music Publishers Association used data from Spotify premium subscribers in Finland to examine the impact of a change to a user-centric system. Even if two subscribers pay the same amount, the user who spends 100 hours a week on Spotify generate more revenues for their favorite artists than the one who only spend 10 hours. The main difference between a pro-rata and user-centric system is that the preferences of super users are far more important under pro-rata. In this case, all of Anna’s money would have gone to The Expressionists. If half of a user’s streams are Rolling Stones songs and half are Beyoncé, then those two artists are the only ones who earn money from that user. Many people in the music industry would prefer a payment system that was “user-centric.” Under this system, each user’s payment would be distributed based on what they streamed. (About 70% of Spotify and Apple Music’s revenues go to music labels and artists.) Essentially, 1% of Anna’s money is going to Drake. So, if Apple Music gave $100 million of their revenues to artists in a month, and Drake songs accounted 1% of all streams that month, then Drake (and the writers of Drake’s songs) would receive $1 million. They then divide that pot by the total share of streams each artist received. They take all of the money generated from users, whether by advertisements or subscriptions, and put in a big pot. The way Spotify and Apple Music pay artists is simple. Anna might reasonably assume that of the money that went to artists from her $10 monthly subscription, nearly all of it went to The Expressionists.
The Expressionist’s new album accounted for 100% of her time listening to music last month on Spotify. She recently fell in love with a jazz trio called The Expressionists (also fictional). Anna, a fictional Spotify subscriber, is a big jazz fan.