Lady Gaga Earns 167 Dollars from 1 Million Spotify Plays
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Artists and songwriters unhappy with “tiny” royalties received from streamed music services.
Spotify has been accused of ripping off songwriters after it emerged that Lady Gaga received just £108 ($167) in royalties for over a million plays of her hit song Poker Face on the music streaming service.
The free and legal streaming service of Spotify has become a huge hit across Europe with over 7 million subscribers; the model is still pending release in the US market due to delays in copyright agreements.
The model is a simple one which works brilliantly for consumers. Listeners have the choice of streaming their music for free, but have to put up with interruptions every few tracks from advertising, or they can pay a monthly subscription fee of around £10 ($15) to receive their music advert free.
However, the model which has proven so popular with the public is receiving less than rave reviews from songwriters who complained of the “tiny” payments they received even from massively successful songs such as Lady Gaga’s Poker Face, Black Eyed Peas’ Boom Boom Pow and Flo Rida’s Right Round.
Provided Spotify gets the green light to be launched in the US by the end of the year, Swedish founder Daniel Ek believes Spotify will be streaming 36 billion songs by Christmas 2010, generating huge revenues for the entrepreneur, but not much at all for the music industry.
In related news, Last.fm silenced their music on demand service, outsourcing the feature to third-party services.
As has become the custom, music executives wailed that if online music services didn’t pay more money to artists then the future of the entire music industry was at risk of collapse. Spotify took a more reserved response and said that royalties from streaming would increase as more people signed up to its subscription services.
Update:
In spite of dire warnings from those aforementioned disgruntled music executives, Spotify’s business model is proving to be sound. The fortunes of both the online service company and the music industry itself seem to be witnessing the benefits of Spotify’s simple but effective approach.
Today a Swedish collection society called STIM has announced a massive eight-fold increase in payments made by Spotify to songwriters; rising from a modest 500,000 Swedish krona to a more robust 4 million. This highlights the swift nature of the online streamer’s success and points towards the shape of things to come.
This rise in overall payments from Spotify might not address every songwriter’s concerns about their individual royalties. However, it does suggest that in time they might be able to look forward to receiving more than what the big stars consider to be a pittance. If the rampant growth of Spotify’s user base continues, the scale of its revenues (and therefore payouts in royalties) could conceivably be expected to rise in concert.
Not these old numbers, from the early days of Spotify, again! How many times will these $167 be re-used by the media?
Short question: How much does Lady Gaga make from 1 million audience radio broadcast of Poker Face? More or less than $167? Spotify isn’t about buying music, it’s about listening to it. Just like radio.
Maybe what you mean is that for every $167 Lady Gaga gets, her record label earns $167,000. Everybody knows the artist gets a very small percentage of the sales.