Can you guess the sample?

Luigi just posted this clip of a new song on his Instagram, bad boy! We’ve already told him off. Can you guess which track he’s sampling? This is the first time Luigi has sampled another track before. But we can tell you, it was worth the wait – what a sexy stomper!

Edit: The clip has been taken down. But Luigi confirmed on Twitter that it was Cathy Dennis’s ‘All Night Long’.


Some thoughts on Amazon Prime Music

Based purely on subscriber figures, Amazon’s just launched Prime Music service is now the world’s largest streaming platform; weighing in at over 20 million paid users compared to Spotify’s 10 million paid user count. Now right here you can argue, but Spotify’s users are dedicated users in the sense that they paid strictly for the premium account whereas Amazon’s users already had Prime and were simply granted this new additional service. Without getting technical, sure that’s correct in a sense, but as it stands, Prime Music is now the biggest active service. So let’s weigh the two together and see what’s going on.

Spotify Premium costs $120 a year whereas Amazon Prime is $99 a year ($50 for students). $20 savings isn’t really anything to shout about, except well, it is; because your Prime subscription gives you so much more for your money than the Spotify one does. But let’s keep it just about the music. So if music is the focus, then actually Spotify clearly wins out here, with over 20 million tracks against Prime’s, err, 1 million. Now you might be wondering why on earth did Amazon launch a service with that pitiful amount of songs? They even launched without any UMG artist songs (so you won’t find me there!). Arguably it’s here you would bemoan the lack of focus — who exactly is this catalogue at Prime aimed at?

Well Prime’s market is actually easy to grasp and so thus is the Prime Music demographic. As mentioned already, this Prime Music service is simply an additional feature for current Prime users — just like their Prime Instant Video (which has a similarly lacklustre catalogue). At its core, Amazon Prime is a next-day/two day shipping programme. All these additional features are merely there to help promote the Prime core, which is to make more purchases on Amazon. Film studios have already said that it has worked for them with the Prime video catalogue successfully upselling DVD packages. By integrating Prime Music within the store, you can search for what you want to listen to and it will appear within the usual music for sale on Amazon, but then if it has the Prime icon next to it, voila, you can listen to it for free. But then what if what you want isn’t for free? Err, just buy it then? Surely if you’re searching for something on Amazon it’s because you’re planning to purchase it.

A common refrain within the industry over the past few years is that consumers do not appreciate having access to huge (tens of millions+) unlimited catalogues. That’s where Prime comes in, being the first major platform to adopt micro-licensing. If you only listen to country music, why would a service that includes millions of classical and hip hop tracks interest you? It wouldn’t. As I argued before in my Spotify piece, streaming services should not be about replacing ownership – but guiding discovering and up-selling the actual music products. That’s what Prime is doing here. Yes Amazon can afford to loss-lead and could have taken on Spotify completely if they really wanted to, they already burn enough money on refund scams. But instead of wasting that money, and indeed wasting portions of the Prime subscription fee, which again, is there for the speedier delivery in its primary usage, the smaller catalogue costs them less and so makes it more worthwhile for them to offer it.

Looking ahead, you can forecast that they might eventually launch a fuller service in 2015. One that either makes Prime users pay an additional monthly fee or makes you choose a specific genre you want. Take a look at these hypothetical figures for Spotify for example. At the moment they have 10 million subscribers at 10 dollars a month, so that’s them racking in at least $100 million a month. But then they have 30 million free users. If Spotify offered a lower tiered $3 a month plan that was limited to specific genres or playlists, then that would unlock an additional $90 million a month that would have been lost before. This is what I see Amazon as loss-leading right now for their Prime users. They are just tanking the cost of this smaller micro-licensed catalogue.

Put simply; it isn’t (currently) a replacement for Spotify. It isn’t even in the same category and those comparing Prime to it and others like Beats/Rdio/etc. are missing the point. But Prime do have a bunch of good tracks if you have typical taste. Great curated playlists. It’s free of adverts. And best of all, it’s included in my Prime subscription already. There is actually nothing to complain about. Your music collection just got bigger without you lifting a finger. If you don’t like it, nobody cares. Just wait until next year, let the service and Amazon grow.


Spotify: A case of copyright bankruptcy

If you follow me on Twitter, you may have seen my small rant the other night about the royalty statement I had just received. I promised I would write a proper piece about it, rather than just a few 160-character sentences. Please note I’m writing from a master ownership perspective, not discussing publishing royalties. As always, I would love to hear your thoughts and comments.

Spotify: A case of copyright bankruptcy

It is pointless to compare the music industry of today to that of the year I was born – 1990. Also, it is useless to compare the state of the market today to when my sister was born – 2000. Today’s modern music business is a whole world of uncharted territory. Nobody knows exactly where it is going or how it is going to work out. But that does not stop tens of ‘hot’ tech companies from buzzing up and hyping their solutions and systems, promising to boom us back to the golden era of the 1960s.

My issue is not that I am bemoaning the complete collapse in album sales. Far from it — I completely understand that society and technology evolve over generations. This is something that taxi drivers should also understand (but that is a completely different topic). My issue is with streaming services. More specifically with what they promise and what they actually deliver. Now, I am a firm supporter of new technology; especially of innovative technologies that actually improve user experiences and quality of life. Streaming, as a technology, accomplishes this very well. The actual concept of anytime-anywhere playback of media is amazing and there is no way that anyone can possibly slam it. If I buy an album, then of course I should be able to play it on any device I want: on my laptop, my iPhone, my Galaxy, my TV. I should be able to play it wherever I am. I paid for the music, so therefore I own the right to ‘use’ it (i.e. listen) whenever and however I see fit. That right belongs to any consumer. However, it is services like Spotify that cause my love of streaming music to die suddenly.

The basics

At its most basic, Spotify lets anyone-anywhere stream any song-any time. That sounds great, no? Indeed in a utopian world, it is perfect. But that just explains the service (and that of other similar platforms like Deezer, We7, iTunes Radio) at the very basic level. When you are playing the songs from these streaming services, you do not actually own the song. You are either listening through a ‘plays for free’ service supported through adverts or you have a premium account that for a modest fee (say £7 a month) gives you unlimited listening without any interrupting commercials. So for the price of one album on iTunes you can get the world’s entire music catalogue right there on your iPhone whenever you want. It is amazing as a piece of technology. Nobody can disagree with that. But at the same time, it is legitimising copyright bankruptcy.

Some of you might say that supporting a financial model that has existed for decades only serves to support the ‘big labels.’ I don’t care to cater this article towards those claims. Any industry has examples of extreme excess if you look closely enough; it is just a lot more visible in the music and entertainment industries. Because that is the nature of these particular industries – they are an escape from everyday life for people. People want to see what they do not have. Listen to what they cannot have. It is both inspiring and encouraging. Music engages across a level that no other media can. And so with that said, should we really be encouraging the devaluation of the very model that drives the creation of what we enjoy so much?

How the royalties work

For the uninformed, Spotify uses a rather mysterious equation to determine the amount of royalties to be paid to the copyright owners each month. Basically, the managers of Spotify place all of the money raised by ads and all of the money raised by the premium user accounts into a pot. They then keep 30% of this pot for themselves as ‘operational expenses’ (when in reality it is just blown on expense account dinners and company credit cards). The remaining 70% is then paid out according to how much playtime each song got. If you had say, half the total plays in a month, then you would get half of that month’s remaining pot. So really if you are at the bottom end of the scale, getting only a few plays a month, you should not expect to get anything, ever, for the use of your music on Spotify.

Because of this playtime-based pay scale, the rate you get paid each month changes. That is completely different from fixed price services like iTunes where you know you will be getting the same sum per each download guaranteed. Taking my last royalty statement, the one that I got mad at on Twitter, I will tell you exactly what I got paid so you can understand why I am so angry.

For each iTunes song purchase, I earned a £0.55 — great! For each Spotify play, I earned £0.006 — not so great. Please note, these numbers are for UK territories only. With exchange rates the iTunes rate ends up slightly different for each territory. As is Spotify’s payout amount, which calculates the playtime rate per each individual territory. So, for example, there might be more paid users in Spain than the US, causing the rates to be very different between the two. In fact I can take a look right now and tell you what those two territories gave me per song via Spotify: ES – £0.004 and US – £0.0007 (yes, that extra 0 there is not a typo). In fact, take a look at this chart below of the differing rates from countries around the world. Look at Mexico giving the highest! But these rates are all meaningless because they change each month.

Spotify royalty rates

To prevent confusion I will be sticking with the UK rates only for the rest of this piece. So just to re-iterate, if you purchased ‘Aye Okay’ on iTunes, then that paid 55p (55 pennies) to the artist. If you streamed it once on Spotify you paid 0.6p (just over half a penny!) to the artist. So for the artist to earn what one iTunes download would earn them from your use of their song via Spotify, you would personally have to stream the song 75 times. Now you might say, “only 75 times? I listen to every song like 100 times a day.” Well yes, you might. I am sure there are lots of hardcore music listeners out there, good luck to you all. But I am super casual. Look at the top 10 most played songs in my iTunes since 2010. Yes the past 4 years. My top 10th most played song was listened to only 79 times in all.

For Carrie, I bought the entire album – so I basically gave them my 55p for that one song. But if I had streamed it 75 times instead, then yes, I would have paid them that much money. And in the case of Karmin, well I would have given them more if I had streamed the track 113 times than the one time I paid for it. So yes, you can all argue for days that “I played a song over 400 times this month alone, I earned them far more with my streaming than if I bought it on iTunes”. Well, good for you! You are a statistical anomaly. If only we were all like you! (Well no, but give yourselves a high five for the effort anyway).

Question of the long term

Right now you may be arguing well, surely streaming is better then? Because it is a long term stream of money rather than the one-time fixed payment that iTunes delivers. Well, no. Not really. Streaming services should be complementing purchasing channels, not displacing them. We should not be using streaming services as the primary way of listening to music. For the month being discussed, for my one song ‘Hands Tied’ I had 1076 streams (counting worldwide) which gave me £10.55 in total. Had those streams been iTunes purchases instead, that would have netted me £591.80. That’s quite a difference. For just one song. For one month. That same month, ‘Pretty Body’ got streamed 2995 times on Xbox Music. That delivered… wait for it… £0.64 in total. Keeping in mind the dismal rates Microsoft pays, this is one time I would have preferred them to stream through Spotify. The point is, for me to make what someone on minimum wage in the UK makes in an hour (£6.31), I would need 1051 streams. That is 1051 streams per hour. 17 plays a minute. This basic figure is completely unsustainable for most acts bar the superstars.

Having shown you the discrepancies between downloads and streaming royalties, your next train of thought might be, “weLL spoTIfy gives u EXPosure to NU fans and U Can sell mOre LIVE and MERCH”. Well quite. Some of us do not actually perform that often and do not sell merchandise. So thanks for that suggestion. And I have not even dug into the publishing side of royalties. All figures given are merely based on master ownership. Publishing royalties is a whole ‘nother essay and I do not have enough rage for that quite yet. Hold on until the summer when I get my publishing royalties in…

When Spotify first started, they mentioned that the larger they got, then the larger the royalty payments would be. Now that’s cute considering that today at 20 million users the rates have hardly doubled since the service’s inception. The size of Spotify in no way affects the payout rate. If it did then surely the $250 million they raised last November would have made its way into payments. The fact is, the music industry today is a business of pennies. You have to collect as many pennies from as many different sources as you can. Yes it’s not cool, but to say that beats having our music ‘stolen’? No, it really doesn’t. Spotify streaming should not be replacing ownership; by doing so, it is devaluing the worth of copyright. The need for musicians to be chasing pennies in itself just shows how respect for the art has been massively devalued. In fact, Spotify itself is valued at a worth more than the entire US recording industry. That just shows how undervalued the creation of music is.

There is a lot more to say on the matter, so I’ll probably write more pieces in the future. Please note that this post is not an attack on Spotify and streaming platforms as a piece of technology. I love it for what it is and what it enables people to do. It’s just that it has somehow been holding the whole industry at ransom with the promise of ‘improved’ royalties but only if they themselves grow. So basically, either we help them grow or we’re stuck with crappy rates. Surely it doesn’t work like that? We are the copyright owners, and without our music they wouldn’t have a service to offer in the first place. Really — the music industry needs to step up and display some self-respect instead of relying on this artist exploitation economy.

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