I’ve grown tired of the propaganda machine that is major record labels. They’re traditional form of making money off the backs of artists is dated — and they know it — despite the obvious continued decline in CD and MP3 album sales.
Since the inception of music streaming services including Pandora, Spotify, Rdio and others; the record label suits controlling all the music publishing rights have made it their mission to gin up hatred from uninformed musicians against these very services trying to help keep money in their pockets.
I touched briefly on similar hate of the internet music companies last year (Pandora hits milestone of 200M users: gives artists another reason to hate them).
See, many musicians have been programmed to believe there’s some hidden treasure being kept away from them by the music streaming providers. More importantly, musicians think these services are contributing to the slow downward spiral that is album sales (MP3’s and CD’s).
For example, America’s sweetheart Taylor Swift, is in a public dispute with Spotify after pulling her entire music catalog off the most popular streaming platform. She started by not including her new hit album ‘1989‘. However, to be fair, similar tactics have been done by other artists as well.
Last year Beyoncé dropped her hugely successful self-titled album, and in the process intentionally blocked out millions of paid subscribers on Spotify, Rdio, and others from streaming the entire album (till this very day you still can only stream Drunk In Love and XO, which is so corny).
(Note: I continue to use Spotify as an example because they lead the music streaming industry in paid subscribers. Personally, I use Rdio).
What has become clear to me is how little these streaming services get in profit, compared to what the majors receive. It’s believed that the Spotify’s, Rdio, and Pandora’s of the world barely collect 30 percent, while labels (master recording and publishing rights holders) get back 70. Streams only account for $0.006 and $0.0084 per play.
On Spotify’s site it’s clearly explained how the pie is split between them and the rights holders.
“Once Spotify has paid a rights owner the total royalties due for their accumulated streams, that label or publisher pays each artist according to that artist’s contractual royalty rates.”
So in other words, if you’re an artist, who feels like you’re being raped (figuratively, of course), you should first take that up with your label.
But in the same vein, Spotify gives Independent artists back 100 percent through the company’s aggregator partners. So the obvious clear choice is to go Independent if you want more money.
So I ask: where is this imaginary trove of cash music streaming services is “keeping” from artists signed to major recording labels? The math simply doesn’t add up.
This is the classic bait and switch that’s been excellently pulled off by major record companies. The goal is to make a villain out of the innovation that music streaming providers bring to the music business, to scare people into continuing to follow the old guard which is buying CD’s. Obviously, musicians make more through that standard, but their rulers (master recording and publishing rights holders) make a lot more.
This thing isn’t rocket science. If musicians want to continue to fight a new wave of making money through music, then it will only be disastrous for them in the long run. People will begin pirating their work even more. What many artists fail to understand is music streaming providers help prevent some of the pirating by giving those same folks “an all you can eat” service for just $9.99 a month.
It’s really clever for recording companies if you think about it. Distract musicians from what really is the issue, and that’s: labels hoarding the majority of the profits for themselves.
Feature Image: Gerran.Howell