News September 15, 2020

About 1% of artists generate 90% of all music streams [report]

About 1% of artists generate 90% of all music streams [report]

A new report suggests 1% of artists generate 90% of all music streams, and the remaining 99% produce only 10% of plays.

The insights from US analytics firm Alpha Data have re-opened criticisms about the low royalty rates paid by streaming services.

Alpha Data, which powers Rolling Stone’s charts, noted that of the 1.6 million artists who placed their music on streaming platforms in the last 12 months, only about 16,000 got 90% of airplay.

What’s more, the top 10% of artists (that is, 160,000) accounted for 99.4% of those streams, which left 1.4 million artists desperately battling for 0.6% of streams.

Spotify doesn’t pay per stream, but rather from a royalties pool based on 65% to 70% of revenue. But it’s generally estimated that its pay-out is between $.003 and $.005 per stream.

Which means that roughly speaking, Tones and I’s ’Dance Monkey’ – which generated 1.8 billion plays on Spotify – made about US$5.44 million from that platform alone.

That doesn’t land in her pocket: Spotify pays the labels, publishers and collecting societies.

Napster offers a more generous rate, at $0.019 per play, Apple Music averages at $.0056, Google Play at $0.0055, YouTube at $0.00069 and Deezer’s was at $0.00436 before its new system.

And it appears the best deals are actually with physical album sales. The top 1% of artists accounted for 54% of such sales in the January to July period.

The new Alpha Data figure tallies with Spotify’s own earlier financial posts that 43,000 of its 3 million artists (or 1.4%) scooped 90% of the streams.

Spotify CEO Daniel Ek estimated last year that close to 40,000 tracks were being added to the service every day, which makes the competition for noise even harder.

Last month (August), Music Business Worldwide looked at Spotify’s Q2 results of €1.89 billion in the three months to the end of June.

“We can therefore broadly assume that 52% of this money, or $1.07b, is being paid in recorded music royalties to labels and distributors, who will carry a portion of that over to their artists.

“Now, if 43,000 artists are pulling in 90% of the royalties, that means those people are getting $963 million of the $1.07 billion. 

“As a mean average, that’s $22,395 per artist, per quarter.”

That works out to an impressive $90,000 per year until of course, you realise that it’s the upper-end superstars in the music business getting virtually all of it.

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