“We can hear you loud and clear,” says the recently launched Spotify website.

Artists deserve “clarity” about the economic interrelationships of music streaming, and the “Loud & Clear” page is intended to offer more transparency.

The triumphant advance of streaming is largely responsible for the fact that the global market for music recordings has been growing again for six years now.

Benjamin Fischer

Editor in business.

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    More than half of the company's last $ 21.6 billion in revenue was generated through Spotify and its competitors. Nevertheless, there has been criticism of the effects of streaming for years: on the music itself, but also with a view to the distribution of the funds. As a listed market leader, Spotify is particularly in focus - especially since concerts have now been almost impossible for around a year and the most important source of income for many musicians is no longer there.

    “It was high time we opened up more,” says European boss Michael Krause.

    The streaming business model is not entirely trivial, especially since the services “do not pay out to artists directly, but to collecting societies and the various rights holders of the music”.

    Of course, the Swedish service also presents all sorts of data on the website to underline its value for the music industry.

    How the money flows

    But the reference to the flows of money is justified.

    Spotify, like other services, pass on around two thirds of their total income.

    But when it comes to how much a musician receives proportionately from this pot, it depends to a large extent on the individual contracts.

    In the case of classic label deals, the significantly larger part usually remains with the labels.

    But musicians have long been offered many other constellations that offer different services and shares in the streaming funds.

    The new website is intended to "stimulate a conversation between artists and their labels, publishers and other partners and help everyone meet at eye level," says Krause.

    Another topic that is often discussed is the payment rate per stream.

    For several months now, there has been a demand for 1 cent per request that has been making the rounds.

    It is true that the distribution is not made per stream, but according to the respective share of each song, measured against all views in a month and market.

    Other factors also play a role.

    But of course it makes sense to calculate the respective pro-stream rate for individual rights holders with their billing, Krause also knows that.

    A comparison between "apples and pears"

    The artist rights blog "The Trichordist" regularly does this on the basis of data from a medium-sized indie label - slightly more than 50 percent of the total income from the services goes to the label side, while publishers (and, in turn, songwriters) receive a significantly smaller amount Proportion of.

    Spotify's “The Trichordist” evaluation last came out in March 2020, with an average of $ 0.00348 per stream, significantly worse than Apple Music ($ 0.00675) and Amazon Music Unlimited ($ 0.01123).

    The comparison of the distributions is "one between apples and pears," said Krause.

    After all, not every service has an advertising-financed free offer, for example. Only a fraction of the revenue generated by subscribers is achieved through its users, so their streams are of less value. Spotify relies heavily on retaining users and converting them into subscribers, although there are also different models such as family or student subscriptions. Apple Music, for example, is not available for free.