Tuesday, April 13, 2010

Spotify Spurns Songwriters, Performers

Posted By on Tue, Apr 13, 2010 at 11:05 AM

With tomorrow's main feature story (written by yours truly) on performing rights organizations and their relationship with performers/songwriters/publishers and the venues that play their music, yesterday's today's story from the Guardian.co.UK about how little Lady Gaga has been paid by Spotify is particularly timely and interesting.

Who gets paid and how much when a song is played is complex issue and one with more twists than a Gordian knot. In a perfect world, songwriters, performers and publishers are paid fairly for their creations. But when you add in streaming services like Swedish company Spotify, how those payments are regulated, what those payment amounts should be and who is ultimately responsible for those payments is wherein lies the rub.

From the story by Dan Martin:

An association of songwriters has hit out at Spotify, casting fresh doubt on the streaming service's capacity to generate income for musicians ... The British Academy of Songwriters, Composers and Authors (Basca), which represents 2,000 songwriters, claimed yesterday that the payments generated are "tiny" and called for the company to be more transparent about the nature of its business ... But last year it was claimed that over a five-month period, 1m plays of Lady Gaga's hit Poker Face—one of the most popular songs on the site—earned her just $167.

While I don't know what formula Spotify uses to pay songwriters/performers, Gaga's video for "Poker Face" has 27 million views on YouTube. To add some perspective, say she was paid one penny for each view: 27,000,000 x $.01 = $270,000.

Then let's say it had only 1 million views—the same number of times it was played on Spotifiy: 1,000,000 x $.01 = $10,000.

Using a per-play formula, Gaga received $.000167 from Spotify each time "Poker Face" was played in that five-month period.

While the formulas for determining payment are probably not simple, neither is writing a check for $.000167.

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