REPORT SHOWS “BIG INCREASE” IN SPOTIFY’S PAYOUT TO INDIE LABELS
A number of metal record labels pulled their artists from Spotify last year claiming low payouts and unfair treatment to independent labels. But now it appears as if things are looking up for indies on Spotify; a confidential report forwarded to Evolver.fm from Merlin — an organization that represents independent labels and lobbies to get them the same treatment afforded the majors — claims that independent labels experienced a “major boost” in revenue from Spotify in the first quarter of 2012.
This is encouraging news for metalheads calling for their favorite labels to re-join Spotify. The information made public by Evolver.fm doesn’t specify the nature of the increased revenue — did Spotify actually increase their payout rates or is the higher revenue simply due to an increased volume of members and streams? — but either way, labels better take notice of the fact that Spotify is finally generating real income for independent labels, and by proxy, their artists.
Among the labels listed as represented by Merlin is eOne, home to Overkill, Darkest Hour, High on Fire and many other metal bands. Sumerian Records is distributed by eOne so they may be represented by Merlin as well, but I’m not able to confirm that. A quick Google search suggests Century Media is a member, but I can’t confirm that either. I can’t find anything connecting Merlin to Prosthetic or Metal Blade, the other Spotify holdouts in the metal world.
There is still no evidence connecting Spotify to lost revenue at record labels. Check out this interesting quote from Spotify founder Daniel Ek in a recent interview (emphasis mine):
Spotify users are the exact same people [who] used to listen to music every day on YouTube, whose entire music collection was pulled off BitTorrent sites. By offering them a compelling music service that allows them to discover hundreds of new artists, not just their favorites pulled from YouTube or [pirated], we’re seeing millions move back to listening to music legally after years of being left out in the cold.
They’re helping pay a ton of money back to the industry. You’re talking 10 million active users, 2.5 million subscribers — most of them paying $120 a year, which is double the amount of your average iTunes user.
Do you really want to hold back your album from people who are finally paying for music again? If you think that by doing so you’re getting them to buy your album on a CD, or as an album download, again, there’s absolutely no evidence to back that theory up. Your album’s getting shared en masse over BitTorrent, over YouTube. It’s there, right now — but you decide that it’s the paying, loyal music fans that should lose out. It makes no sense.
Hopefully news of the increased Q1 revenue from Spotify spreads to the metal labels that have withdrawn from the service and we see them join up again before the end of 2012.
-VN
[via Lefsetz]
