Spotify: Solely For Profit and Not For Artists
Running down the stats from 2022 to highlight how much money I made for Spotify this year.
Every December Spotify sends artist something called “Spotify Wrapped”. An awful cringeworthy set of slides highlighting exactly how much work you did throughout the year, and how much Spotify profited from it as a result.
Reluctantly, probably more out of morbid fascination than anything else, you click on the “Jump In” button, and prepare yourself for the montage of “So this is how we fucked you over in 2022”.
They inform you how many people streamed your music for free (or perhaps for a very small monthly fee), and how many times your songs were played.
It’s at this point where you start scratching your head and reach for the calculator, just to confirm the insane numbers you’re seeing in front of you, and what they would mean if only a tiny percentage of those listeners put any value in the art and paid for it.
If you err on the ultra conservative side of things and use a potential conversion rate of sales of 5% of the total people who listened for free, you get just shy of 1,670 people. Multiply that by what you think an album of yours might be worth. Let’s use $20 as a nice round number. Using that math you actually end up assigning a single dollar to each listening as the potential revenue would come to around $33,371.
I understand there are a lot of variables and other things to take into consideration here, and that this equation is very rough around the edges. The 33,371 listeners I had in 2022 for instance represent people listening to an entire catalogue, and not just one album. But I would gladly take that figure of $33,371 and go plus or minus $10,000 to allow for all those other factors, and still walk away with a budget big enough to cover the cost of almost any future recording I want to make.
Now look at the image above. That’s the reality of 2022. For all the fanfare and colorful slides Spotify waste tons of money creating, the bottom line is that I barely broke $1,700 in revenue. For the entire catalogue of 12 albums and 2 singles. And don’t forget, that’s the ENTIRE revenue from all digital platforms, not just Spotify.
So when Spotify tells you that your listeners added you to 2,311 playlists just this year, they’re telling you that the plays your music got from each of those playlists didn’t even amount to a single dollar each.
They also boast about how powerful their distribution model is when they inform you your music was heard in 134 countries. But they share no data with you that is of any use. Nothing you can use to communicate with your fanbase and build upon the distribution to create a better live-touring framework.
This year was the first time since I started releasing music as an artist that I broke even on a record. I did that through involving the audience ahead of time in a pre-sale, and it meant I got complete creative freedom to make the exact album I wanted.
I was very clear that this wasn’t a crowd funding exercise like indiegogo or kickstarter, and that no matter whether I sold one pre-sale or one thousand, I would have made the album anyway. There was no financial goal to be met in order for the project to take place. Just as there never was in the past. I believe in the art, I shoulder the financial risk, and I make the albums.
Those risks, for the past 18 years, have not paid off. With roughly $125,000 spent on recording over the years, I have only recouped about $72,000. That was until I opened up inclusion into the process this year and brought a lot of you with me for the ride. I also chose not to put the album on any of the streaming services, and the only way to hear it was to either be in on the ground floor for the pre-sale, or purchase the music from my website after it came out. Something you can still do by the way.
Moving forward I intend to do something similar with how I make new albums. I will eventually release the music to Spotify and all the other asshole streaming services out there, but it is only for public archival purposes, and only after the life cycle of the album has concluded.
I really enjoyed making the film about the process, and that’s something I hope I can continue with as the trio goes on the road in 2023, and as we get ready to record more music around the world.
This mailing list, and the support I get from you all, means the world to me. It’s very important to be able to share all this data with you and not be shy about real numbers, and the reality of the process. It helps me to stay very grounded and focussed on solving the issues we all face as musicians.
The point of talking somewhat negatively about Spotify and streaming in general, is not to shit all over people out of frustration, but rather to think out loud and make sure the conversation is headed in the direction of a solution.
Janek
This post is so very eye opening. All that exposure, for what? Companies like spotify don't value the artists or the consumers. It raises the question, what's the point of reaching to thousands of listeners or no return?
There's this notion that musicians have to be on spotify, but the results bring those practices into question. I had a similar thought when you "deleted" instagram.