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.
Nevertheless, Ted Cohen, Spotify’s former senior VP of Digital Development and Distribution still talks the talk for the service, saying, “Spotify has just completely charmed Europe with its ability to deliver to you unlimited streaming of any song you’ve ever thought of in your life,” Cohen says.
Now we’re aware Spotify is being roundly touted as the anti-iTunes, and we’re also all completely aware now that Apple will offer its own model of hybrid subscription service later this year.
Apple’s model may allow you to stream anything from your own collection from the cloud to your own device for free, with a paid-for element to enable streaming of any iTunes movie or track). Whether the additional provision of movies will happen or not remains in doubt, as film studios are unwilling to accelerate the decline of DVD sales.
European Spotify users can pick among 7 million tracks for free, in exchange for listening to a few ads, alternatively they can fork ot ten Euros to have music ad free, which can also be downloaded for offline playback on an iPhone.
Cohen warns labels aren’t in a hurry to see the Spotify service launch in the US. “The rights holders are all concerned that we went from selling a $10 CD to selling a 99-cent track, and now we’re talking about a quarter of a cent per stream played by user.”
Apple’s recent purchase of online music service Lala.com is interesting. Already the biggest US music retailer, Apple isn’t averse to suggesting to labels that they don’t get too enthusiastic in their play with competing services – consider the Amazon MP3 daily deal debacle as example of this.
Hypebot editor, Bruce Houghton, notes “The average Spotify user, and this isn’t a secret, had 10,000 tracks in their Spotify playlist – their favorites. How many of us own 15,000 tracks? So the case with a lot of these services is simply getting people to try them, and then the word spreads.”