What about other streaming services, like Tidal, that pays 0.013/stream? Is this just marketing, they are trying to look like the good guys, or it's Spotify that is being greedy?
Also, to me it looks like 4200min/month is not a realistic number. What do you think?
4200/60 is 70 hours, that doesn't sound unrealistic to me given people often work a little bit over 160 hours a month.
On Tidal, in addition to what Luke posted, one thing in their favor is that Tidal doesn't have to worry about free ad-supported users. Tidal, hence, should have a much higher amount of revenue per user on average since less than half of Spotify users even pay the subscription.
I wouldn't fault this article too hard for that since it's a super difficult thing to account for since we don't know how much revenue an ad-supported user is worth, and there's other business costs left out. We just can't be too specific because we don't know.
Thank you for the feedback. It is true that Tidal pays out more per stream on average! However it is also true that Tidal offers two tiers of subscription prices, 10.99 and 19.99. The 19.99 subscription includes the higher quality streaming experience (what Tidal is known for) so it is probably justified to assume many users are buying in at that price point. This only further proves my point that if streaming services want to pay out more, they must charge more to do so.
It is difficult to find very accurate estimates on the exact amount of music the average user consumes per month on Spotify. So some assumptions had to be made about the data. It is also true that throughout its entire existence, Spotify has had many more unprofitable quarters than profitable quarters. According to the company it claims to payout 70% of all payments collected back to artists, which seems like a very believable number to me based on the calculations in the piece. If you sell your CD in a store, the store does take a percentage to maintain its own operating costs. If Spotify was really just overly greedy, rather than bound by market forces, it surely would payout less to artists and just be profitable every single quarter, but considering it has competition it can not do so.
What about other streaming services, like Tidal, that pays 0.013/stream? Is this just marketing, they are trying to look like the good guys, or it's Spotify that is being greedy?
Also, to me it looks like 4200min/month is not a realistic number. What do you think?
4200/60 is 70 hours, that doesn't sound unrealistic to me given people often work a little bit over 160 hours a month.
On Tidal, in addition to what Luke posted, one thing in their favor is that Tidal doesn't have to worry about free ad-supported users. Tidal, hence, should have a much higher amount of revenue per user on average since less than half of Spotify users even pay the subscription.
I wouldn't fault this article too hard for that since it's a super difficult thing to account for since we don't know how much revenue an ad-supported user is worth, and there's other business costs left out. We just can't be too specific because we don't know.
Thanks for the feedback, appreciate your thoughts!
Thank you for the feedback. It is true that Tidal pays out more per stream on average! However it is also true that Tidal offers two tiers of subscription prices, 10.99 and 19.99. The 19.99 subscription includes the higher quality streaming experience (what Tidal is known for) so it is probably justified to assume many users are buying in at that price point. This only further proves my point that if streaming services want to pay out more, they must charge more to do so.
It is difficult to find very accurate estimates on the exact amount of music the average user consumes per month on Spotify. So some assumptions had to be made about the data. It is also true that throughout its entire existence, Spotify has had many more unprofitable quarters than profitable quarters. According to the company it claims to payout 70% of all payments collected back to artists, which seems like a very believable number to me based on the calculations in the piece. If you sell your CD in a store, the store does take a percentage to maintain its own operating costs. If Spotify was really just overly greedy, rather than bound by market forces, it surely would payout less to artists and just be profitable every single quarter, but considering it has competition it can not do so.