With European success behind the firm, Spotify is planning to launch in the UK, even while fresh reports confirm (what we’ve been saying for some time) that the cash artists get from streaming services isn’t enough to justify prosecuting file-sharers.
A Billboard analysis shows that even the amount of money earned by top artists from on-demand streams and noninteractive streams (such as Internet radio) is, in plain terms, shockingly low. “Of the more than 100 artists examined to compile the Money Makers list, only 10 made more than $2,000 from noninteractive streams in 2009,” a Billboard report eplains.
Interestingly, the labels seem to do alright out of the streaming music deal. Rob Wells, the senior vice-president Digital for Universal Music Group International says Spotify was Universal’s fourth largest digital partner last year in terms of the amount of revenue it generated for the company.
Sony BMG, Universal Music, Warner Music, EMI and Merlin (the body which represents Europe’s independent labels all own shares in Spotify, shares the company offered the labels for an aggregate €8.8 million – presumably as part of the negotiation to secure permission to stream their music online.
Together, the labels own 18 per cent of Spotify. Sony BMG took the lion’s share, now owning 5.8 per cent of the service.
Spotify has secured $50 million in investment funding, even while company staff anxiously wait to see if Apple gives permission for the music streaming service to offer an application to iPhones.
Spotify has attracted over two million users so far and is whispered as a service likely to threaten Apple’s iTunes. It offers users the chance to stream songs using the internet without downloading tracks.
Ads-supported, it also offers download sales and a £9.99 ad-free subscription service, membership of which is required to use the iPhone app.
Hot news from the analysts at Music Ally, who recently pored through transcripts of a hugely important UK Copyright Tribunal case to surprisingly find out that Apple’s iTunes has some ambitions toward launching an ad-supported music service.
We’re not going to give out all the information on the matter – you’ll have to contact leading UK music industry analyst firm Music Ally to find out more, but Judge Fysh QC, presiding over the Tribunal, was driven to state, “iTunes may well carry advertising in future”.