Music News: 225 Spotify streams = 1 iTunes download ($1.29)

Dust2

A breakdown of $1.29 song sold on Itunes

Quote:

30% to Itunes
70% to labels,artists, songwriter/publishers.

70% of $1.29 = $0.903

Spotify pays the label/artists/songwriters about $0.004 per stream. Which mean 225 streams will give $0.903. The same as a $1.29 Itunes song sold.

Since it's $9.99 for Spotify Premium in the USA and €9.99 for Spotify Premium in Europe, I will use the $0.004 (instead of converting €0.004 into $0.0054 at the current exchange rate).

http://www.spotidj.com/blog/?p=264

Quote:

I have just received the Q2 statement on the Spotify payouts to the band Little Things That Kill. Spotify must be doing really good because they now pay 0.4 Eurocent per stream. That means the payout has almost doubled over the last 3 months.

There is a similar thread about VEVO here:

129 VEVO views = 1 iTunes download ($1.29)
821 Pandora Radio streams = 1 Itunes download ($1.29)

Dust2

250,000 new users each day added and Spotify enable "Private Listening" function so songs you don't want to appear on Facebook feed will stay private.

http://www.slashgear.com/spotify-250...deal-27183114/

Quote:

Spotify is reportedly seeing 250,000 new users join each day, in the aftermath of its deal with Facebook last week, with monthly active users leaping by 1m to 4.4m. The figures, shared by music industry consultancy MusicAlly, contrasts sharply with criticism of Spotify’s decision to tie new sign-ups up with the social network. Spotify currently offers six months of its unlimited access package free to new users.

http://www.billboard.biz/bbbiz/indus...05377462.story

Quote:

For all the praise Spotify's integration with Facebook received from music industry chin-strokers over its benefits to music discovery, it received no shortage of complaints from users concerned with the privacy implications of automatically sharing every song they played on the service.

Spotify today responded to those concerns. Founder and CEO Daniel Ek announced via Twitter this morning that the company has developed an update to the service that will include a "private listening" function. It's basically a check-box that users can quickly turn on or off and thereby control when the music they're listening to will appear in their Facebook feed and when it won't.

"We're rolling out a new client as we speak where you can temporarily hide your guilty pleasures," read one Tweet. "It works like a browser's private mode. ... We call it 'private listening' and you can find it in the Spotify/File menu and toggle it on/off."

spotify paid subscribers growth:

January, 2010:------------ 250,000 paid subscribers
March 17, 2010:----------- 320,000
July 20, 2010: ---------------- 500,000
December 8, 2010: ------ 750,000
March 8, 2011:--------------- 1,000,000
July 14, 2011: -----------------1,600,000
Sept 21, 2011: ---------------- 2,000,000 paid subscribers

iLays

i luv u. lol

Bad Wolf

Quote:

Originally posted by iLays

i luv u. lol

+1

I 2nd this.

RatedG²

Wait...what?

foxaylove

I must say, you're a really quality member. I lover your number crunches on all things music related. It's refreshing, you should be talk to Kworb some times!

Yahhh!

I can see why some people are rushing out singles/albums these days. Between VEVO, Spotify and the like, there's HUGE money to be made from streaming. The funny thing is that the music consumers for the most part aren't paying for the music.

Peep

Kworb glue your wig! This member is coming for ya! Thank you for your amazing posts as always.

omgitsralph

Amazing post, thank you.

WillingtonHH

wow .. pretty interesting.. Thank you

Dust2

More good news for the music industry:

http://techcrunch.com/2011/09/29/mus...ces-take-over/
Music Piracy Down As Streaming Services Take Over

Quote:

The Swedish polling company, Media Vision, has released a study (in Swedish) about downloading habits in the country where Spotify was born. Their results? 23 percent of Swedes download music illegally, down 2 to 3 percent since 2010. In short, music piracy, at least in that market, is falling rapidly and much of that decline can be attributed to the popularity of services like Spotify.

As *******freak notes, there’s no way to compete with free, but when content is made available on multiple platforms for a fair price it’s clear that consumers will react favorably.

Obviously this is a small sample (4344) and a small country but it is very telling. If a country with a high rate of broadband use and the wherewithal to use and understand streaming services can make a dent in music piracy, can the rest of the world be far behind?

Greg Kumparak said that whenever he tells folks about services like Spotify and Rdio, he gets wide-eyed glares of disbelief and a pledge to sign up immediately. Why? Because piracy is hard. Ripping CDs is hard. Digging through *******s is difficult. It doesn’t make any sense for anyone over the age of, say, 22, to be digging through The Pirate Bay to find an REM discography. Sure it’s easy to find if you know where to look, but why not just type “REM” into a music service and spend the rest of the day rocking out?

So what happened between 2009 and now? Well, many of these services expanded beyond the desktop to the smartphone, allowing you to listen to music on almost any device. I, personally, listen to Rdio on two laptops, a desktop, two iPhones, and a Sonos system (not all at once). I have no desire to sync all of those machines to one static library any more than I want to download every single new release that comes down the pike. A $9.99 per month streaming service makes a lot of sense, especially for folks who don’t want to futz much with files.

Will streaming destroy piracy? Absolutely not, but it will go a long way to chipping away at the perception that music is free.

Dust2

Rhapsody purchased Napster

Rhapsody: 800,000 paying subscribers
Napster: around 250,000 paying subscribers

http://latimesblogs.latimes.com/tech...ree-music.html

Quote:

A more fundamental challenge for Rhapsody and its rivals has been the lack of public awareness about subscription services in general. The exposure from Facebook is helping on that front, although again it seems to be benefiting Spotify more than anyone else. And as a result, all the online services are feeling the heat to beef up their free offering. Their goal, as one executive put it, is to draw in the people who appreciate "the full value proposition" of a subscription service -- in other words, music fans who want more than the ability to play a song from an online jukebox from time to time. Those are the consumers who could be persuaded to spend $10 a month for a service that puts millions of songs at their fingertips, wherever they happen to be.

Rhapsody Chief Executive Jon Irwin said his company is buying Napster to increase its subscriber base. Assuming Napster users don't quit en masse, the acquisition should put Rhapsody over the 1-million-subscriber mark -- not a bad achievement, but not the goal line either.

Look like in the USA, the battle will be between Rhapsody (1 mil +) vs. Spotify (2 mil + in USA and Europe).

Rhapsody/Spotify could die off if the big phone carriers (Verizon, AT&T, Spring, T-Mobile) bundle their service with unlimited music download like Cricket did with Muve Music ($55 a month for unlimited MUSIC DOWNLOAD, unlimited talk, text, web).

Dust2

http://musically.com/blog/2011/10/08...10-financials/

Exclusive: Spotify Ltd’s 2010 financials: £63.2m revenues but £26.5m net loss

Quote:

Spotify Limited has filed its 2010 financial results with Companies House in the UK, and they reveal a 458% year-on-year increase in revenues from £11.32 million in 2009 to £63.17 million in 2010.

The company’s advertising revenues grew from £4.51 million to £18.06 million in that period, while its subscription revenues increased from £6.81 million to £45.07 million.

Profitability? In a word, no. Spotify Ltd reported a loss for 2010 after taxation of £26.54 million, compared to a loss of £16.61 million in 2009.

Digging into the figures, they reveal that the £63.17 million of revenues were outweighed by Cost of Sales of £64.8 million, with Administrative Expenses of £23.73 million and other costs contributing to the net loss.

Spotify Ltd is a subsidiary of Spotify Technology SA, and part of the Spotify Group. But these aren’t UK-only figures: Spotify Ltd “operates and provides the music service for end-consumers (private individuals) in the UK and other European markets”.

The report outlines briefly Spotify’s strategy for 2011, too. “The Company’s primary focus is to continue its rapid growth and consolidate the business within a fast-moving industry, which counts a number of influential players within its space,” it explains.

“It is crucial that Spotify continues to penetrate existing and new markets as quickly as possible and continues to build on the success which has seen the company emerge as the largest and fastest growing music subscription service of its kind worldwide.”

Since the end of the period covered by the financial report, Spotify has launched in the US, and increased its number of paying subscribers to more than two million.

This is important: the significant rise in subscription revenues shown in the 2010 financial report happened before Spotify reached its first million paying customers, and it’s since doubled that total. In other words, the financials for 2011 – which won’t be published until this time next year – should show an even larger spike in subscriptions revenue.

In August this year, Music Ally estimated that Spotify was making around €13.8 million (£11.86m) a month from subscription revenues, based on leaked figures on the company’s performance. That means Spotify’s 2011 subscription revenues could top £142 million.

Analysts have already been guessing about Spotify’s 2010 financials. In August, Analysys Mason predicted that Spotify would generate revenues of €59 million (£50.72m) for 2010, and report a “modest profit of a few million euros”. Oops.

Good news: Revenue went from $18 mil to $99 mil.
Bad news: Music royalties (licensing fees) went from $30 mil to $102 mil.

SPOTIFY is focusing on GROWTH.....it doesn't mind paying $102 mil in music royalties but taking in only $99 mil from subscription revenue / advertisement........so long as it can GROW. Profits will come later.

Peep

Thank you for the income statement!

Chemist

Dust2

http://www.billboard.biz/bbbiz/indus...05397762.story

Quote:

Subscription revenue accounted for most of the increase in total revenue. It grew to £45.1 million ($70.7 milliion) from £6.8 million ($10.6 million). Advertising revenue grew to £18.1 million ($28.3 million) from £4.5 million ($7 million).

In other words, about 10 percent of Spotify users - the paying subscribers - generate about 71 percent of the company's revenues.

2010: $70 mil subscription revenue (10% of Spotify users pay)
2010: $28 mil advertising revenue (90% of Spotify users use the free version)

Assume $10 per subscribers per month, $70 mil / $10 / 12 months = 584,000 subscribers on " revenue average" in 2010.

Deuces

Wow. That's really informative. It really helps you understand the business structure of the music industry. Thanks.

Dust2

http://www.spotidj.com/blog/?p=287

This indie band share with SpotDJ his Spotify revenue (through CD Baby aggregator).

352 streams total ---$2.5549 total

= $0.007258 per stream. THIS IS VEVO territory (129 streams = $1 Itunes download).

Quote:

For every song you see 3 entries. $0.0026 for a stream by a Free user, $0.0042 for an Unlimited user and $0.0092 for a Premium user? Correct me if this assumption is wrong. And what if you calculate the average of these 3 amounts? Yes: $ 0.0053 exactly the same as the amount Spotify paid to Zimbalam for every stream in the same period.

acive

streaming should get a bigger share now on the billboard hot 100 computation.

Dust2

http://www.reuters.com/article/2011/...79C5N120111013

Quote:

Spotify, the European music streaming service backed by digital entrepreneur Sean Parker, has more than 250,000 paying users in the United States since it opened up shop in July, according to three people familiar with its data.

.

Quote:

Rhapsody, the U.S. market leader, has 800,000 users after 10 years of being in business. But it is expected to grow to around 1.2 million after it snapped up Napster from Best Buy Co for an undisclosed sum earlier this month

January, 2010:------------ 250,000 paid subscribers
March 17, 2010:----------- 320,000
July 20, 2010: ---------------- 500,000
December 8, 2010: ------ 750,000
March 8, 2011:--------------- 1,000,000
July 14, 2011: -----------------1,600,000
Sept 21, 2011: ---------------- 2,000,000 paid subscribers
October 14, 2011-------------I would guess around 2,150,000 paid subscribers or around there