Yesterday Digital Music News published an article about the state of Spotify royalty payments.
‘Viva Spotify’ isn’t quite the phrase being bandied about at Midem, and executives from both sides of the Atlantic are continuing to disparage. But this is a nuanced picture. Most European executives we’ve talked to recognized that Spotify has achieved ubiquity in many countries, and considerable progress on the premium front. And, this is an addictive product that’s playing by the rules.
But the money situation is problematic, and that has prompted a few independents to jump ship. But also on the major label side, the royalties are a royal problem. In fact, one major label executive close to the numbers pointed to a bizarre problem: there aren’t enough zeros in the royalty program to calculate the fractions being paid by Spotify.
So, think .00000000000005 euros and you get the idea. ”It’s laughable, if it wasn’t so sad really,” the executive told Digital Music News after a few beers.
It seems as though executives and even Digital Music News don’t understand why Spotify is a great service for artists. Having your music on a specific service isn’t always about the revenue generated by that single activity. Spotify allows artists to showcase their music with the aim of growing their fan base even further. I would much rather have 1 million listeners on Spotify and get some of them to see us in concert, instead of just selling a few downloads on another store.
Spotify also aims to provide a service that will attract users away from bittorrent and other p2p services. More music is being consumed that ever before and from a larger diversity of artists. However, legal music only makes up a less than 7% of the entire online music market. Executives should be focused on helping to grow these new services that will attract users from illegal alternatives, instead of trying to pick holes in the legal service of Spotify!
Midem has been suffering recently with lower attendance numbers and decreasing revenues. Thus, Midem though that they would start charging bands to fill the gap in revenues.
So how much does it cost to play at Midem? Well from 500 to 1,000 euros per hour. Thats not including transportation, food, etc.
“I love Midem,” blogged Echo Nest CEO Jim Lucchese. ”But I have a problem spending a week with industry peers in beautiful Cannes discussing how to build a sustainable music industry for artists and fans, while the bands I’ll be seeing that week pay to play for me and the other attendees.”
Band Metrics is a newly launched (on the back of this year’s Midem) service that allows bands to keep track of their radio exposure in different cities, and who’s talking about them on Twitter along with their location, plotted on a Google map. While the radio tracking service is only really useful to larger, more famous acts, the Twitter locator is quite useful, as long as you take care to make sure your band name is distinctive, as the word filter can’t differentiate between subjects or pick up phrasings. The platform is bound to develop, and add functions to it’s reporting, but even now it’s a relatively handy little tool for planning a tour and guaging the level of interest in your act in a given location.
Head over to the Midem blog and watch an interview in which Ed O’Brien discusses how they made a success of releasing ‘In Rainbows’ independently of any record labels, and what that success meant for their band.As one of the most important ‘game changing’ releases of recent years it’s interesting to hear O’Brien tell the big labels to sit up and take notice. Of course Radiohead had the benefits of already having been made famous working with record labels (XL, TBD, Parlophone, Capitol), and the novelty and notoriety of being one of the first big acts to give their music away, but there are lessons to be learnt.
Coke first previewed a new album during Midem in January which collaborates members from Gnarls Barkley, Fall Out Boy, Panic At The Disco and Gym Class Heroes. Now Coke has properly debuted tracks in TV ads, while also being heavily promoted online and sold through iTunes.
Qtrax has released a press release this morning stating that they have finally signed Sony BMG to their catalogue.
Qtrax is a legal P2P downloading service. In January 2008, Qtrax was overeager to announce it’s launch during the Midem conference and misrepresented ongoing negotiations and expired deals with major recording labels as being signed deals.
Qtrax is a very interesting service that has never really lived up to expectations. I’m keen to see how the service grows and if they can actually deliver decent royalty rates for the content providers. Here at RouteNote we are always looking for the next site to take off and Qtrax is definitely in the mix.
Band Metrics
