More and more lately on “Now Hear This Entertainment” guests tell me that where you best stand a chance of making any money in the music business these days is merchandise and touring.
I know, you were hoping to hear ‘from Spotify,’ right?
The fact is, if you’re putting all your time and effort into trying to get people to stream your music so you can use the proceeds to book an island getaway and sit on the beach sipping fruity drinks while working on your tan, you’re going to have to settle for a postcard instead.
Granted, what I’m about to share with you doesn’t apply to the superstars named Ed Sheeran, Lady Gaga, and so on. However, assuming you’re not a household name – and be honest, a truly national (if not international) household name – this is where you need to take a long look at how you’re endeavoring to make money with your music.
To be fair, there are two sides to every story. So, for every Alan Gogoll (NHTE 269) who really is making quite good money from streaming, there is a Blake Morgan (NHTE 208) who will argue against this business model.
Now, the ways in which music streaming royalties are paid can be confusing even to seasoned industry insiders. ConsumersAdvocate.org created a guide on the music streaming industry with an amazing infographic and calculator that breaks down how much you can get paid by each service. These tools are designed to help show not only how much each streaming service pays per stream, but how many streams per month it would take, per streaming service, for an artist to make the U.S. minimum wage.
Brace yourself, because the findings are quite scary.
Again, just to make the U.S. minimum wage of $1,256.67 it would take 366 THOUSAND plays on Spotify – in one month. Suddenly that exotic vacation doesn’t look too likely, huh? The good news is, on Apple Music it “only” would take 240 thousand plays in a month. The bad news is, Pandora (1.1 million per month) and YouTube (2.1 million) are even worse.
ConsumersAdvocate.org broke things down further and showed the average artist revenue per play, which goes from a “high” of $0.0060 on Apple Music to a low (on YouTube) of $0.0007 (with the other two in between, meaning, Spotify at $0.0044 and Pandora at $0.0013). (See full chart below.)
Just keep telling yourself, merchandise and touring, merchandise and touring.
Last month on NHTE 310 Joey Stuckey said people are buying CDs just as a souvenir of having been at your live show – not necessarily because they intend to play your music through that format. This week on NHTE 314 (coming Wednesday) you’ll hear the guys in the band Judd Hoos say that they’ve got albums, meaning, vinyl. That means they’re not betting it all on black, er, streaming, to put them in the black.
I always loved the Electric Light Orchestra, who did (among many others) the song, “Don’t Bring Me Down.” Don’t let this blog bring you down. Rally around this information and pivot accordingly. And then when you’re out there touring (see what I did there), make sure we connect when you come through Tampa.
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