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Spotify pays out 13% more royalities in Europe, report says
Musicians may rail against streaming services and how much they pay out, with Taylor Swift even going to far as to pull her music from Spotify entirely this week, but perhaps they should rethink that strategy. Because it is starting to look like Spotify has now started to overtake the iTunes Store as a revenue generator in some areas.
According to new data out from Kobalt Music Publishing, and reported on by VentureBeat, songwriters in Europe actually earned 13% more from Spotify than they did from iTunes in the first quarter of 2014.
The most surprising think is how much the numbers have flipped in a pretty short period of time. Writers were still getting 8% more from iTunes in the fourth quarter of 2013. In the third quarter that number was 32%. Overall, streaming revenues for its Kobalt musicians are now 10% of income, as compared to 3% in 2011.
Kobalt, an independent music publisher and music services company, that offers services that include online global copyright administration, creative and synch/licensing services, digital collections, label services, neighboring rights management and pipeline advances to rights holders.
The company says that it administers more than 250,000 copyrights worldwide on behalf of over 1,200 content holders including the world's top songwriters, artists and other music publishers. So they have access to a good amount of information to glean from.
“Spotify overtaking iTunes in Europe is an important new milestone in streaming,” Willard Ahdritz, founder and chief executive of Kobalt, said in a press release. “The music industry’s infrastructure is failing them, unable to efficiently account for the enormous volumes of data from digital transactions.”
Of course, the writing has been on the wall for digital music purchases for a while now. Things are changing, and quickly.
Last year alone, streaming rose 32%, while digital track sales suffered their first year to year decline. And it was recently reported that iTunes sales are down a total of 13% this year so far. And so it's no surprise that seemingly every major Internet property, including Google, Twitter and, yes, Apple, is trying to break into the space right now.
Still, comments from musicians like Radiohead's Thom Yorke, Jimmy Buffet and members of Pink Floyd regarding the amount of royalties they make from streaming services like Spotify and Pandora, and the recent move made by Swift, show that as much as things are shifting, it is going to be a bumpy ride and there will be some big fights ahead.
(Image source: joelmalm.com)
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Pandora, the leading internet radio service, gives people music they love
anytime, anywhere, through a wide variety of connected devices: laptop and
desktop computers, smartphones, connected BluRay players, connected TVs,
etc. Personalized stations launch instantly with the input of a single “seed” –
a favorite artist, song or genre. The Music Genome Project®, a deeply
detailed, hand-built musical taxonomy, powers the personalization or
Pandora. Using this musicological “DNA” and constant listener feedback
Pandora crafts personalized stations from the more than 800,000 songs that
have been analyzed since the project began in January 2000.
More than 75 million people throughout the United States listen to
personalized radio stations for free on Pandora through their PCs, mobile
phones and devices such as the iPad, and connected in-house devices
ranging from TVs to set-top boxes to Blu-Ray players. Mobile technology has
been a significant factor in the growth and popularity of Pandora, starting
with the introduction of the Apple app store for the iPhone in the summer of
2008. Pandora instantly became one of the most top downloaded apps and
today, according to Nielsen, is one of the top five most popular apps across
all smartphone platforms.
Pandora is free, simple and, thanks to connectivity, available everywhere
consumers are – at the office, at home, in the car and all points in between.
In 2009 the Company announced that Pandora would be incorporated into
the dashboard in Ford cars via SYNC technology; GM has already followed in
announcing plans to integrate Pandora into its vehicles and Mercedes-Benz
introduced their Media Interface Plus device that works with the
free Pandora iPhone app to provide direct control of Pandora from in-dash
stereo controls. This was all great news for the millions of Pandora listeners
who had been plugging their smartphones into car dashboards to listen to
personalized stations while driving. More than 50 percent of radio listening
happens in the car, making it a crucial arena for Pandora.
Today tens of millions of people have a deeply personal connection with
Pandora based on the delight of personalized radio listening and discovery.
These highly engaged listeners reinforce the value Pandora provides to: 1)
musicians, who have found in Pandora a level playing field on which their
music has a greater chance of being played than ever before; 2) advertisers,
who benefit from the multi-platform reach of Pandora, as well as its best
practices in targeting consumers for specific campaigns; 3) the music
industry, which has found in Pandora a highly effective distribution channel;
and 4) automobile and consumer electronics device manufacturers, who have
noted that incorporating Pandora into their product makes it more valuable
Pandora continues to focus on its business in the United States. The radio
arena has never been hotter, thanks to technology that enables radio to be
personalized to the individual and more accessible than ever before. Right
now millions of people listen to Pandora in the United States and we hope
someday to bring Pandora to billions of people around the world.
• 2000 – Tim Westergren’s Music Genome Project begins.
• 2005 – Pandora launches on the web.
• 2008 – Pandora app becomes one of the most consistently downloaded
apps in the Apple store.
• 2009 – Ford announces Pandora will be incorporated into car
dashboard. Alpine and Pioneer begin selling aftermarket radios that
connect to consumers’ iPhones and puts the control and command of
Pandora into the car dashboard.
• 2010 – Pandora is present on more than 200 connected consumer
electronics devices ranging from smartphones to TVs to set-top boxes
to Blu-ray players and is able to stream visual, audio, and interactive
advertising to computers, smartphones, iPads, and in-home connected