How does that affect your wallet?
Song downloads are on a steep slide that shows no sign of easing up. Meanwhile, streaming figures just keep rising. So, if you’re an artist or a songwriter, it’s no big deal if streaming is picking up the slack from downloads, right? Uh, not really. Raw figures don’t tell the full story as far as your potential income is concerned.
First the figures from Nielsen Music: During the first half of 2018, song download sales were down 27.4% to 223.1 million from 307.2 million for the first half of 2017. Album downloads also fell 21.7% to 27.5 million units, down from 35.1 for the same period last year.
Meanwhile, streams jumped 41.6% to 403.4 billion, January-June 2018, a gain of 118.6 billion (a half-year record) compared with the first half of 2017. As Digital Music News pointed out in a story posted July 10, 2018, not so long ago, paid downloads were greater than one billion annually. Now, Drake’s album ‘Scorpion’ chalked up more than one billion streams in a single week.
So Drake probably doesn’t need to be too worried about the decline of downloads. But for artists who are not up in the same stratosphere as Drake, this is not good news as revenue from streams is nowhere near that of downloads. And even that isn’t very much. Single track downloads that cost 99c earn the artist around 11c on iTunes, Google Play and Amazon.
‘Fractions of one cent’
When it comes to getting paid for streaming, you receive mere fractions of one cent per stream from the major streaming services. These include Napster, YouTube, Pandora, Apple Music, Tidal, Google Play, Deezer and Spotify. In July 2017, Digital Music News posted a report titled ‘What Streaming Music Services Pay,’ available here. (Note: these figures may have changed since that report was posted.)
See the Digital Music News report for full details, but they note that Napster tops the pay-per-stream list with $0.0167 per stream for unsigned artists. Signed artists received $0.0190. In comparison, Apple Music pays unsigned artists $0.0064 per stream and signed artists $0.0073 per stream.
Meanwhile, YouTube is still the lowest payer and not improving. In 2015, an unsigned artist would earn $1,260.00 after 70,000 plays. In 2017, that artist would need to score 2.4 mullion plays to earn the same amount. However, YouTube should be seen by an artist as a promotional and marketing tool, rather than a revenue stream. (See previous post here at Nashville Music Line: ‘How to build community with YouTube.’)
But for the artist at least, it’s not all bad news, if you are prepared to get out there on the road and tour. Live music ticket sales revenue will grow from $7.2 billion U.S. dollars in 2015 to $9.1 billion in 2021, according to a report earlier this year posted by Statista.
What about songwriters and streaming?
Songwriters and publishers are finally getting a break when it comes to streaming. This is due to a ruling by the Copyright Royalty Board that requires streaming services to pay 15.1% of their revenue to the writers and publishers, up from 10.5%.
The music publishers association hailed the ruling, even though the trade group estimates recording labels will still be receiving $3.82 for every $1 paid to songwriters and publishers. Even so, that still represents “the most favorable balance in the history of the industry,” said David Israelite, president of the music publishers association, according to an Associated Press story from January .
“Songwriters desperately need and deserve the rate increases,” said Bart Herbison, executive director for the Nashville Songwriters Association International (NSAI) in the same AP story.
The bottom line:
If you are an artist, don’t count on streaming (or downloads for that matter) to be a reliable source of income. But you can put streaming to work for you building awareness of your new songs and making people familiar with your music, boosting ticket sales at your shows. As an added bonus, racking up a lot of streams can bring an indie artist to the attention of a major label, if that’s your goal.
What’s the difference between downloading and streaming?
You are probably familiar with both music downloading and streaming, but there can be some confusion between the two terms, so here’s how they differ.
When you download music from iTunes, Amazon or Google Play, the file is transferred directly to your device and stored there. Once it’s stored, you don’t have to be connected to the Internet to listen to it. You pay a fee for each recording then you may transfer it to your other devices, if you wish.
Streaming music is different because you don’t actually own the tracks. You listen over the internet, either through wi-fi or mobile data. A lot of streaming services offer a free version that includes advertising in addition to premium ad-free services with no-limit access to millions of songs – and the option to store music so you can listen offline, for another fee.
Preshias Harris is a music journalist and music career development consultant with the emphasis on new and aspiring artists and songwriters. Her book, ‘The College of Songology 101: The Singer/Songwriter’s Need to Know Reference Handbook’ is available at www.collegeofsongology.com Follow her blog at www.nashvillemusicline.com