Back in November, Tone Deaf reported on a trio of studies collated by music industry bible Billboard, which indicated that while streaming services offer consumers a cheaper alternative to purchasing music, the use of streaming services actually drives music sales to a significant degree.
The results of the studies show that not only do many streaming users go on to buy the music they first hear from their respective services, but streaming platforms such as YouTube and Spotify are in fact three times more effective at driving music sales than traditional AM/FM radio.
While these results might suggest that streaming is nothing but a boon for an artist’s bottom line, a recent letter from Sony/ATV CEO Martin Bandier, via Digital Music News, tells a different story. In the letter, Bandier details the meagre royalties some of his biggest artists received from streaming services.
According to the CEO’s missive, a staggering 43 million Pandora streams of one of his artist’s biggest singles netted a measly $2,700 in royalties, or about $60 for every one million plays. The artist? Pharrell Williams. The song? Yep, it was ‘Happy’, a.k.a. one of the biggest tracks of 2014.
And the super-producer wasn’t the only one singled out by Bandier. According to the CEO’s letter, R&B star John Legend’s hit ‘All of Me’ was streamed a similarly remarkable 55 million times on Pandora during the first three months of 2014, but generated only $3,400 in publisher and songwriter royalties.
Of course, it’s important to note, as Fusion do, that the $2,700 amount that Pharrell received from Pandora refers only to his songwriter royalty payments, and does not include his performance rights payments, which would bump his cut up to approximately $25,000 – still meagre for the biggest song of the year.
And the list of hit-makers to get a raw deal from streaming keeps going. Back in November, singer Aloe Blacc, who had a smash with ‘Wake Me Up!’, a collaboration with Swedish producer Avicii, wrote an op-ed in which he claimed he received less than $4,000 domestically through Pandora for the song.
Despite breaking Spotify records and becoming the 13th most played song on Pandora since its release in 2013, with “more than 168 million streams in the US”, ‘Wake Me Up!’ resulted in “only $12,359 in Pandora domestic royalties — which were then split among three songwriters and our publishers”.
With numbers this grim, it’s little surprise that, as Time reports, music industry heavyweight Irving Azoff, who founded the new legal group Global Music Rights, is now demanding YouTube remove 20,000 videos from artists his organisation represents, including Pharrell, or face a $1 billion lawsuit.
According to Azoff, the Google-owned video streaming giant, which recently launched its own music streaming service, does not have performance rights to thousands of songs from about 40 of his clients, including the Eagles, Chris Cornell, and John Lennon.