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News June 12, 2023

Spotify’s Mikaela Lancaster Talks ‘Significant Impact of Streaming to the Music Economy’

Senior Journalist, B2B
Spotify’s Mikaela Lancaster Talks ‘Significant Impact of Streaming to the Music Economy’

The borderless streaming business provided a glimmer of joy for Australia’s music community in 2022, a time when travel was spotty and full-scale international touring was more hopeful than a reality.

That’s one of the takeaways from Spotify’s Loud & Clear report.

Issued last week, the streamer’s annual document made a big play on its efforts in championing homegrown Aussie talent.

According to the report, Australian acts generated revenues on the platform last year of nearly $250 million, with nearly 80% of those royalties generated by fans outside of these parts.

Also, Spotify reports, the rate of growth for Australia’s music community is far exceeding the overall market. The national music industry’s revenue has grown by 14.2% overall in the years since 2018, according to the IFPI, where revenue generated by Australian artists from Spotify during that time grew by 75%.

All of which suggests something is clicking.

Spotify’s managing director AUNZ Mikaela Lancaster explained more in a Q&A with The Music Network, conducted over email before the document went wide.

Loud & Clear reports Aussie artists generated $250 million in total revenue for 2022? Is there a corresponding figure for 2021?

This is the first time we have been able to provide this data and while we did not compare revenue figures from 2021, we have looked at IFPI and broader Australian industry revenue growth as a comparison as we felt it was important to highlight the significant impact of streaming to the music economy.

Does that figure include foreign-based Aussies, like Kylie Minogue, Nick Cave, AC/DC and Gang of Youths?

Yes, it includes those big names but also a lot of the great talent right here that we are supporting through programs like RADAR, EQUAL and Spotify Singles every day.

Keenan Te, Spacey Jane & Dom Dolla are just some of the rising artists seeing significant growth in the last 12-24 months. 

Does the data reveal bands of income for those Aussie acts? Apparently, the average income here is $90,000. How many Aussie artists achieved that national average through Spotify?

The data on bands of income generated on Spotify is on a global level only.

For the first year ever, over 10,000 artists generated more than $100,000 on Spotify. What’s more, these artists hail from more than 100 different countries around the world. 

Overall streaming is lowering the barrier to entry.

According to the data, revenue generated by Aussie artists on Spotify in years 2018 to 2022 grew by 75%, well up on the average of 14%. Any thoughts on how and why that’s the case?

Streaming is generating more revenue than ever before, and that has enabled many more artists to benefit. 

Spotify’s expansion over the years has given more opportunities to more artists to find new audiences around the world.

That is the power of our global platform and our ability to give Australian artists the backing they need so that they can break through and find their audience

One great example of this is Ruel.

We provided marketing support for his recent album release which debuted at No. 8 on the Spotify U.S charts and No. 13 on the Global charts. 

Some 80% of those revenues came from the world outside Australia. Those exports are what every artist and label dreams of. Is there a theme to how that was achieved?

We invest significant effort to ensure the discovery and success of artists.

Our efforts 一 including playlists, but also marketing, artist education, and in-kind support over and above substantial royalty payments 一 have helped Australian artists to grow.

Spotify Australia’s editorial team curates 160 local editorial playlists that showcase Australian artists, including 24 completely dedicated to local artists. 

There is also our emerging artist program RADAR. One such artist recently supported through this program was grentperez.

After being highlighted as a 2022 RADAR artist, new release ‘My Heart It Beats for You’ was playlisted on multiple editorial playlists, leading to thousands of new discoveries.

Over 80% of listeners to these playlists discovered grentperez for the first time. His number-one market is now the U.S and has just gone live on a billboard in Times Square.

grentperez Billboard at Times Square

Of course, a chunk of that reporting period coincided with the pandemic. When most folks were stuck at home, twiddling their thumbs. Did Aussie acts enjoy an unexpected lift as a result of lockdowns?

What we really saw through the pandemic was a change in where and when people were listening.

The regular commute and listening via a mobile device was no longer a regular part of listeners’ day. Instead, we saw an increase in listening through desktops and Smart TVs.

In terms of music trends, catalogue music listening increased as Aussies leaned into nostalgia during this time. 

Are you able to identify any “moments” that caused Aussie artists to gain traction? Perhaps TikTok “virality” influenced those streams on Spotify, or performances on U.S. late-night TV. 

Culture takes place on Spotify and what’s happening in culture gets reflected on Spotify.

Our editorial team are looking at music trends, what are audiences searching for on the platform to ensure we’re serving them and also ensuring we’re creating a home for the music artists are creating.

Typically we will see trends around artists touring, where there is an uplift in streams as listeners continue to connect with the music.

Support for Aussie artists on local radio, as well as big radio moments like Triple J’s Hottest 100, also generally provide uplifts in streams.

Have you any advice to Aussie recording artists out there who want to get a piece of the action ?

There is a wealth of education and information we provide, which is part of our approach to lowering the barrier to entry through streaming, which predominantly sits on Spotify for Artists.

This is a hub for artists and their teams to promote their work through managing their profile, marketing tools, educational resources, and audience stats. 

In addition, it’s crucial that artists are getting their music pitched actively on Spotify for Artists and keep their fans looped in on when to expect new music.

Encouraging fans to ‘follow’ their artist page is also a great way to maximise the chances of your music being included in your fans’ Personalised playlists, such as Release Radar and Discover Weekly.

Streaming is one major part of the music ecosystem, so it is also about using the data we provide to understand your audience and how you can maximise opportunities for touring but also merchandise. Everything contributes to growing a fan base.

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