Streaming now accounts for almost half of music revenue
Revenue in the music industry is up, thanks in no small part to the explosive growth of streaming services, such as Spotify and Pandora.
After years of shrinking profits due to online piracy and falling prices, revenue is now up 8.1 percent for the first half of the year, according to the Recording Industry Association of America.
That’s good news for record companies. However, the streaming companies are still over a barrel, said Andrew Sparkler of Downtown Music Publishing.
“They’re saying, ‘We’re paying 70 cents of every dollar for royalties, and that doesn’t take into account any other aspect of our business and that’s untenable,” Sparkler said.
According to Spotify’s annual report, revenue in 2015 was up 80 percent, but it still couldn’t turn a profit. In fact, its net loss actually grew.
Dean Wareham is with the band Luna. He said making money off streaming largely depends on who owns the recording.
“On Luna records that we own, we see some income,” he said. “On the records that we made for the Warner Music Group, we barely see anything.”
It’s true, noted Wareham, that royalties for musicians have tanked since the time when people bought more physical products and legal downloads.
These days he makes more from T-shirts than streaming.
“And from playing live. You know, I earn more in one or two nights playing at a club in New York than I do from Spotify all year long,” Wareham said.
On the flipside, he noted, in 2016 you don’t necessarily need a record label to get your music out.
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