In a new call with investors, Spotify revealed continued, if slow, growth.
It’s good to be king. Spotify was the first to make a big splash with music streaming, and their early entry into the marketplace helped propel the Swedish company to the top of the food chain. These days, the term Spotify has become synonymous with streaming. “You can find them on Spotify” means, “you can stream their music online.” That’s an excellent place to be, and the latest stats for the music company show the good times are far from over.
Spotify held its Q2 earnings call with investors earlier this week. During the update, the company announced it had passed 232 million monthly active users, up 29% since this time last year. Spotify also boasts 108 million paid subscribers, up 31% year over year. An infographic detailing all the latest developments at the company was also released. Check it out:
The biggest announcements of Spotify’s Q2 earnings report.
Apple Music is Spotify’s closest competitor. At the beginning of July, Apple Music announced it had just surpassed the 60 million subscriber mark, which leaves Spotify with a substantial lead. However, the new data from Spotify reveals a slowing adoption rate for subscribers. The cause for that slowdown is not clear, but market saturation and increased competition are two likely factors contributing to the change.
Spotify has a lot of developments on the horizon that the company hopes will raise the growth rate, including additional podcast content and a device for automobiles that will eliminate the need for terrestrial radio in vehicles. You can learn more about the device, which has been dubbed the ‘car thing,’ in the Music Biz News clip below.
Streaming has made a significant impact on songwriting. So much so, that the entire music industry is trying to catch up to ‘The Spotify Sound.’
No one knew what Spotify would do to the music business. People were quick to assume the easy of access to the majority of all recorded music would lure people away from physical media, but no one thought to consider the ripple effect that seismic shift in consumer behavior would create.
Physical sales of music were on the decline before Spotify launched, but the now ten-year-old company and its competitors in the streaming market have also created a drop in download sales. A few niche formats found success in the early 2010s, specifically vinyl and cassette tapes, but those trends have also fizzled as streaming continues to gain momentum.
The latest evolution resulting from the age of streaming concerns songwriting. With most streaming platforms counting a play after consumers have listened to the track for thirty-seconds, more emphasis than ever is being placed on the way songs begin. There is also added emphasis on the runtime of tracks, as well as the volume of material being released.
On this episode of Music Biz 101, host James Shotwell explains the phenomenon know as ‘The Spotify Sound’ and offers a two-step solution to writing songs that generate a high volume of streams.
The Nielsen mid-year music report is here, and it shows the reign of streaming services over the industry is far from over.
Nielsen is widely considered to be the authority on the business of entertainment, and their latest mid-year report reveals the music industry is in good standing. The recently published data found the first half of 2019 shattered previous 6-month records with more than 507 billion on-demand combined music and video streams and milestones led by singles and albums from Ariana Grande, Billie Eilish, Halsey, Khalid, BTS, and Bad Bunny.
The fall is widely considered the busiest time of the year for music, so it is likely the total on-demand combined streaming numbers will be equal to, if not greater than the statistics above. If true, that would mean 2019 is on pace to be the first year where streams of recorded music surpass one-trillion plays in the United States and Canada.
To date, many of this year’s most significant music moments were aided by exposure in popular films. The success of A Star Is Born, for example, gave Lady Gaga and Bradley Cooper’s smash hit duet “Shallow” a major boost following the Acadamy Awards. The song has earned more than 684,000 track downloads, 316 million on-demand song streams, and over one-billion audience impression on the radio to date.
Nielsen sites other areas of entertainment as playing a very influential role in the rise of the year’s most popular songs. The music featured in film and television continued its upward trend from 2018 when soundtracks accounted for two of the year’s top 10 biggest sellers (The Greatest Showman and Black Panther: The Album). The impact good placement has on songs can be understood by looking at the success of Post Malone and Swae Lee’s “Sunflower” ( 47.6 million U.S. streams), which appeared in the equally popular animated film Into The Spiderverse, or through the continuing success of rock biopics such BohemianRhapsody and Rocketman.
There is a wide range of Global pop genres that made a sizeable impact in the U.S as well, including K-Pop and Latin. K-Pop’s global domination, which reached record peaks in 2018, continued to reach new audiences.
230,000 equivalent album units earned for BTS’ Map of the Soul: Persona, a career-best for the K-Pop group, during the week ending April 12.
BTS and Halsey’s “Boy With Luv” reached 125 million on-demand streams so far this year, including spikes after their performance at the Billboard Music Awards on May 1.
18.6 million first week on-demand streams for BLACKPINK’s “Kill This Love,” which broke the band’s own record for highest-charting single by a K-Pop girl group on the Billboard Hot 100.
Nielsen Music’s Mid-Year 2019 Charts:
2019’s Mid-Year Top 10 Albums (Based on Overall Equivalent Album Units)
1. Ariana Grande, Thank U, Next (1,552,800) 2. Billie Eilish, When We Fall Asleep, Where Do We Go? (1,304,000) 3. Khalid, Free Spirit (929,000) 4. Lady Gaga & Bradley Cooper, A Star Is Born (Soundtrack) (889,000) 5. A Boogie Wit da Hoodie, Hoodie SZN (810,000) 6. Post Malone, beerbongs & bentleys (756,000) 7. Drake, Scorpion (718,000) 8. Queen, Bohemian Rhapsody (Soundtrack) (705,000) 9. Juice WRLD, Death Race for Love (675,000) 10. Jonas Brothers, Happiness Begins (663,000)
2019’s Mid-Year Top 10 Selling Albums
1. Lady Gaga & Bradley Cooper, A Star Is Born (Soundtrack) (404,000) 2. Jonas Brothers, Happiness Begins (374,000) 3. Billie Eilish, When We All Fall Asleep, Where Do We Go? (343,000) 4. BTS, Map of the Soul: Persona (343,000) 5. Backstreet Boys, DNA (299,000) 6. Queen, Bohemian Rhapsody (Soundtrack) (253,000) 7. Ariana Grande, Thank U, Next (228,000) 8. Soundtrack, The Greatest Showman (181,000) 9. P!nk, Hurts 2B Human (158,000) 10. Lauren Daigle, Look Up Child (154,000)
2019’s Mid-Year Top 10 Selling Vinyl Albums
1. Queen, Bohemian Rhapsody (Soundtrack) (61,000) 2. Queen, Greatest Hits (49,000) 3. Billie Eilish, When We All Fall Asleep, Where Do We Go? (47,000) 4. Soundtrack, Guardians of the Galaxy: Awesome Mix Vol. 1 (33,000) 5. The Beatles, Abbey Road (33,000) 6. Pink Floyd, The Dark Side of the Moon (32,000) 7. Bob Marley & The Wailers, Legend (30,000) 8. Fleetwood Mac, Rumours (29,000) 9. Michael Jackson, Thriller (29,000) 10. Billie Eilish, Don’t Smile at Me (28,000)
2019’s Mid-Year Top 10 Selling Digital Songs
1. Lil Nas X, “Old Town Road” (958,000) 2. Lady Gaga & Bradley Cooper, “Shallow” (684,000) 3. Post Malone & Swae Lee, “Sunflower (Spider-Man: Into the Spider-Verse)” (488,000) 4. Ariana Grande, “7 Rings” (420,000) 5. Halsey, “Without Me” (388,000) 6. Post Malone, “Wow.” (381,000) 7. Jonas Brothers, “Sucker” (357,000) 8. Lauren Daigle, “You Say” (322,000) 9. Taylor Swift featuring Brendon Urie, “Me!” (322,000) 10. Ava Max, “Sweet But Psycho” (321,000)
2019’s Mid-Year Top 10 On-Demand Song Streams (Audio and Video Combined)
1. Lil Nas X, “Old Town Road” (1,337,995,000) 2. Post Malone & Swae Lee, “Sunflower (Spider-Man: Into the Spider-Verse)” (850,194,000) 3. Ariana Grande, “7 Rings” (776,696,000) 4. Travis Scott, “Sicko Mode” (623,498,000) 5. Halsey, “Without Me” (599,335,000) 6. J. Cole, “Middle Child” (582,748,000) 7. Post Malone, “Wow.” (582,633,000) 8. Blueface, “Thotiana” (588,277,000) 9. Marshmello & Bastille, “Happier” (528,640,000) 10. YNW Melly, “Murder On My Mind” (498,806,000)
2019’s Mid-Year Top 10 On-Demand Audio Streams
1. Lil Nas X, “Old Town Road” (596,113,000) 2. Post Malone & Swae Lee, “Sunflower (Spider-Man: Into the Spider-Verse)” (458,470,000) 3. Ariana Grande, “7 Rings” (433,904,000) 4. Post Malone, “Wow.” (416,231,000) 5. J. Cole, “Middle Child” (395,872,000) 6. Meek Mill featuring Drake, “Going Bad” (337,025,000) 7. Halsey, “Without Me” (319,879,000) 8. YNW Melly, “Murder On My Mind” (287,219,000) 9. Lil Baby & Gunna, “Drip Too Hard” (284,613,000) 10. Travis Scott, “Sicko Mode” (276,802,000)
Spotify has changed the music business in many ways, including a few that you may have never considered.
There are many streaming services in the world, but none of them can compare to the size and influence of Spotify. With more than one-hundred million subscribers, the Swedish based company has nearly double the audience of its closest competitor (Apple Music). The company has grown so popular, in fact, that it has become a kind of shorthand for streaming music. People say, “Do you use Spotify,” instead of, “do you subscribe to a streaming music platform?”
Spotify has revolutionized how artists make money from their music. The company pays, on average, between $0.006 and $0.0084 per song stream. A single stream is counted when the listener has played thirty-seconds of the track. If the listener finishes the song, that’s great, but it doesn’t change the amount of money the stream earns for the artist.
With this in mind, it’s easy to understand why many industry experts claim Spotify has changed the sound of music. The ‘Spotify Sound,’ as it has been dubbed, refers to artists who waste no time getting to the heart of their song. The days of lengthy introductions or slow-burning tracks has been replaced by immediate choruses or other attention-grabbing tactics.
Another element of the ‘Spotify Sound’ is the length of a song, which again is a result of the company’s approach to compensating talent. If a play is counted after thirty-seconds of listening time, then artists are not incentivized to make longer songs. The more financially informed approach would be to record more material that is shorter, thus earning more money. A five-minute song earns as much as a two-minute song, but listeners can play multiple two-minute songs in the same amount of time, which means they can earn more money.
A glance at the Spotify and Billboard charts shows the impact of the company’s influence. “Old Town Road,” which has spent three months topping charts, is less than two minutes in length. The remix, which helped catapult the song into the pop stratosphere, runs just over two and a half minutes long.
Artists who have adapted to the influence of the ‘Spotify Sound’ are seeing success on the platform. In a recent digital feature from PBS, two members of the group Frenship credited their efforts to match the changing trends for the success they found with their hit “Capsize.” Check it out:
Other platforms have different rules for what counts as a play. Some services require a certain percentage of the song to be enjoyed before a play is counted, while others have a higher minimum for time spent listening. Both methods of counting plays encourage the same thing. Artists should make shorter, catchier songs if they want to earn big from streaming services.
The streaming wars are upon us, and Netflix needs to take action before a competitor steals one of the biggest niche audiences.
After years of streaming domination, Netflix finds itself in a war for subscriptions, and music may have the answer.
Netflix is at a crossroads. For more than a decade, the entertainment company has reigned supreme over the world of film and television. Specifically, Netflix has been the leader in streaming content for longer than virtually any of its competitors have existed, but that may soon change. A new crop of streaming platforms are rising, with many owned or largely controlled by the companies that once relied on Netflix to stream its content online.
A quick Google search for new streaming platforms will shed more light on the state of video in 2019. In addition to Hulu and Amazon Prime, which have been gaining ground on Netflix for years, Disney, Warner Bros, DC Comics, Apple, and more have or are preparing streaming platforms of their own. Disney’s product, Disney+, will offer every Marvel movie, Star Wars Film, and Disney original for less than the current cost of a monthly subscription to Netflix. The house that Mickey Mouse built will also pull all its content from Netflix when the platform launches, which is likely what all the other studios will do when their services go live in the months and years to come as well.
That impending change has put more pressure on Netflix to create original content that justifies its rising cost and shrinking library. The company has invested millions into original series with mixed results, but it has found a lot of success through its embrace of stand up comedy. Be it Chris Rock, Amy Schumer, or Joe Rogan, the biggest names in comedy have made Netflix their home, and the company has reaped the benefits of having fans of the art form flock to the platform for fresh content weekly.
Netflix may find similar success through music. After leaving the music industry mostly untouched for the last several years, Netflix made waves in the industry by releasing Taylor Swift’s concert film for her Reputation stadium tour and Springsteen On Broadway at the end of 2018. That release was followed in April with the debut of Beyonce’s Homecoming concert film documenting her now legendary performance at Coachella. Both films were exclusive to Netflix, and each made it possible for millions of fans around the world to witness events they otherwise could not see.
This month, Netflix has taken its relationship with music further by releasing a Martin Scorsese documentary on Bob Dylan and announcing the exclusive premiere of Radiohead frontman Thom Yorke’s new short film. That latter is particularly exciting because it is intended to pair with Yorke’s new solo album, which means Netflix is playing an active role in supporting new music rather than celebrating things that have already happened.
Where Netflix goes from here with music is up in the air, but the company would be wise to continue investing in and aligning itself with musical talent. The live entertainment industry is booming, but no consumer is able to see everything or even a fraction of everything they want to see in a given year. Netflix has the ability to support artists while also helping them engage with fans who otherwise cannot see them live or get to know them behind-the-scenes.
That said, Netflix needs to hurry if they want to claim reign over music as they have the world of comedy. Amazon Prime released an original film from Donald Glover, otherwise known as Childish Gambino, earlier this year. Amazon also released a Jonas Brothers documentary days before the group’s recent album, Happiness Begins, hit stores. Apple has not announced any music projects for their upcoming video streaming service, but it’s not hard to imagine the exclusive video content made for Apple Music will also appear on that platform.
Despite being one of the lowest paying streaming platforms, artists worldwide can see their careers change overnight through YouTube.
The study by Pex showcases categories on YouTube that are dominant drivers of growth and engagement for the platform. The study examined the performance of publicly available videos on YouTube for a period ending December 31, 2018. The results reveal that YouTube has over 5.2 billion videos, 1 billion hours of content, and 29 trillion views.
To put that figure into perspective, it would take 41,666,667 days of nonstop watching to view everything that was available on YouTube when the study was completed. Even more content is available now.
According to the data Pex shared, YouTube saw around 621 hours of content uploaded every minute in 2018, or roughly 10 hours of content every second. That’s even higher than the 500-hour estimate shared by CEO Susan Wojcicki earlier this year. Unsurprisingly, the length of these videos has increased each year since the restriction lifted.
Youtube videos are getting longer, and ads are largely to blame.
The reason for the change of the average video length is likely the result of YouTube’s advertising deal with creators. YouTube shares a portion of the revenue for ads shown during the video with that clip’s creator, but the service limits how many ads can be displayed based on the length of the accompanying video. Longer videos, therefore, equal more ads, which means more money for creators (even if their viewers are frustrated).
Gaming is the fastest-growing category on YouTube thanks to the popularity of services such as Twitch, but music still has the lead.
The average length of a music video on YouTube is 6.8 minutes, with an average of 2,411 views per minute and 16,397 views per video. That’s compared to the gaming category’s average of 24.7 minutes per video with only 121 views per minute and 2,987 views per video.
Music is the category with the shortest videos, but it generates the most views per average video. The music category received 20% of all total views on YouTube last year — but makes up only 5% of YouTube’s content. Music and Entertainment are the two YouTube categories that deliver the highest returns, but YouTube doesn’t want you to know that because both entertainment and music videos often require the company to pay royalties. YouTube does not want to share revenue anymore than it needs to, which is likely why the streaming giant has been investing heavily into original content.
The less YouTube needs major labels and movie studios, the better, at least for YouTube.
Despite reports claiming otherwise, a new study from a marketing research company reveals that the war on piracy far from over.
Despite reports claiming otherwise, a new study from a marketing research company reveals that the war on piracy far from over.
The music industry breathed a sigh of release last September after global piracy platform MUSO released a report claiming that piracy was on the decline. The streaming age, it seemed, had finally converted thieves into consumers.
This week, however, a new study published by marketing research company MusicWatch claims otherwise.
In a blog post focused mainly on stream-ripping services, MusicWatch claimed to have tracked 17 million users downloading their music on websites from video platforms, including YouTube. That’s up from 15 million from the same period two years ago.
The top 30% of stream-rippers also downloaded an average of 112 music files, the equivalent of 10 full music albums, over the course of the year.
“That may not seem a lot in a world where streaming services hold millions of songs, but ask any rights holder how they feel about someone copying their works. For a more vivid picture, imagine someone shoplifting 11 albums from Walmart or Best Buy!”
MusicWatch Blog, 2019
The question of why the spike occurred remains unanswered, but MusicWatch points the blame at search platforms such as Google for not taking the matter seriously. The company believes it is easy for anyone to find a stream-ripping service in a matter of clicks, and that files ripped from sites such as YouTube are seen as a replacement to mainstream music streaming services such as Spotify.
A quick search by the Haulix team proved their theory to be true:
Google and other search platforms are under fire for not doing more to prevent access to stream-ripping services like the ones seen here.
Additionally, the study from MusicWatch revealed that stream-rippers are also more likely to participate in other forms of unsanctioned music sharing. These include downloading songs from unlicensed music apps and sharing songs on digital lockers or file-sharing sites.
They’re also more likely to go to the movies, play video games, and subscribe to video streaming platforms, like Hulu and Netflix. That, says the marketing research company, amplifies the risk of piracy in each category. If they’ll steal music they don’t own, why wouldn’t they do the same for films, tv, or video games?
Of the people surveyed by MusicWatch, 68% of stream-rippers in the U.S. are aged between 13 and 34. A slightly higher number of males pirate when compared to women, 56% to 44%. The average household income of stream-rippers is between $75,000 and $199,000. Only 34% are full or part-time students, which strongly suggests that professionals are also downloading music for free.
As for solutions to these problems, MusicWatch concludes their study by reiterating the need to fight back against stream-ripping platforms.
“If [stream-rippers] pirate music, they’ll likely also take movies, TV shows, and other forms of intellectual property. Discouraging stream-ripping isn’t just good for music; it’s good for the entire entertainment ecosystem.”
There have been several lawsuits filed against stream-ripping websites in recent years, while other stream-ripping platforms have received cease and desist letters. Until action is taken to block or otherwise remove stream-ripping sites as a whole, the entertainment industry will have to wage war against the services on a site-by-site basis.
Streaming has changed the way artists make money, but that doesn’t mean the biggest stars of today have fallen on hard times.
When its the last time someone told you about buying an album? When is the last time someone who wasn’t a collector (vinyl, cassette) told you they bought an album? Unless your inner circle is filled with devoted, old school music fans the answer is probably not anytime in the recent past. We live in the age of digital, which means we live in the streaming era, and that evolution has changed the ways musicians make money.
Depending on who you ask, this is a good and bad thing. Newer artists, especially in the world of rock and metal, claim streaming has made it harder to earn money because fewer people are willing to pay $5 or $10 to purchase their music outright. On the other hand, artists who create strong singles have found that the ease of access that Spotify and similar platforms provide has lowered the barrier to discovery. Those artists still make far less per stream than they would if each play was tied to a sale, but high stream counts can prove more beneficial than sales over time.
Whatever the struggles for newer artists may be, those talents at the top of the industry hierarchy are continuing to rake in plenty of cash in the age of streaming. Understanding the math behind the streams is often a struggle, but Billboard recently uncovered the top 5 streaming earners of 2019 so far, as well as a rough estimate of just how much money they’ve brought in for their label and team.
1. ARIANA GRANDE Total label streaming revenue YTD: $12.08M Total audio and video on-demand streams YTD: 2.83B
2. DRAKE Total label streaming revenue YTD: $11.29M Total audio and video on-demand streams YTD: 2.58B
3. POST MALONE Total label streaming revenue YTD: $10.90M Total audio and video on-demand streams YTD: 2.63B
4. JUICE WRLD Total label streaming revenue YTD: $8.38M Total audio and video on-demand streams YTD: 1.92B
5. BILLIE EILISH Total label streaming revenue YTD: $7.93M Total audio and video on-demand streams YTD: 1.89B
Billboard’s estimates are based on Nielsen Music data and other information as of the week ending April 18. It’s a month later now, but the top five most likely remains the same, only with larger play counts.
It’s important to note that the second figure under each artist’s name combines song and video streams. Audio streams generate more revenue than video streams, but YouTube is an incredibly popular platform for music.
The figures above cover the sound recording royalty that the record label collects and doesn’t include publishing.
Spotify is working to empower artists, and it’s coming after Instagram’s most popular feature along the way.
With over 100-million premium subscribers, Spotify is already the biggest streaming platform in music by a wide margin. That kind of lead allows the company to work on expanding other areas of its business, and that includes making the platform more social.
Now testing on iOS and Android devices, Spotify Storylines provide listeners with behind-the-scenes information about songs direct from artists. The information is presented like an Instagram Story, with a carousel of cards featuring a combination of text and images that you can tap through. Android Police notes that the feature is only available on a select number of songs right now, including Sucker by the Jonas Brothers, and a handful of songs by Billie Eilish.
Here’s a look at Storylines in action:
At the time of posting, Storylines are only available to The Jonas Brothers, and Billie Eilish, and not every mobile user can see the functionality. Spotify most likely approached the artists directly for their participation in the program, and as of right now, there are no public plans to roll the feature out to more talent.
That said, industry analysts have long predicted that Spotify would move into more social and editorial content. Storylines would give artists a direct line of communication to their listeners, and the possibilities that line presents are limitless. Artists can detail the story behind a song, promote a tour, promote recordings, or even provide steps to joining their official fan club.
In a statement, a spokesperson from the company said, “We are always testing new ways to create better experiences for more users,” but did not confirm when the feature would be released more broadly.
The latest data point from Spotify’s founder reveals a hard truth about competition in the streaming age.
Spotify Founder and CEO Daniel Ek spoke with investors this week during a quarterly earnings call to discuss the latest developments at the streaming giant. Amongst the many tidbits of information shared, including the companies’ recent success crossing the 100-million paid user count, was the fact that nearly 40,000 new songs are added to the service each day. To be specific, Ek said:
“with more than 50 million tracks now available on Spotify, and growing by close to 40,000 daily, the discover[y] tools we’re building have never been more important to consumers and artists alike.”
Daniel Ek, speaking to investors on April 29, 2019
Let’s put that figure into perspective. Forty thousand tracks per day equal about 280,000 songs a week or around 1.2 million tracks per calendar month. In a year, this volume would add up to a whopping 14.6 million.
Therefore, at its current rate, every three-and-a-half years, Spotify will add over 50 million tracks to its library. Considering the platform currently boasts a catalog of roughly 50 million songs total, the current growth rate would double Spotify’s music library by 2022, and it could happen sooner than that.
To look at it another way, let’s accept that the average song is about three minutes long, or 180-seconds. With 40,000 songs added every day, Spotify is creating roughly 2,000 hours worth of new competition for clicks each morning.
If you listened to every song added to Spotify in a single day without taking breaks it would take you a little more than 83 days to hear everything. That’s almost three months of music being added to one streaming service each day.
Daniel Ek also added that the “number of creators that are engaging directly with Spotify’s platform continues to increase, growing to over 3.9 million” in the first three months of 2019. That figure refers to musicians and podcasters, both of whom are contributing to the overwhelming amount of content being added to the platform each day.
Artists reading this now may find themselves in a panic. After all, how can anyone adding music to the platform with a promotional juggernaut behind them hope to stand out in a sea of music far too large to ever be consumed in full? For them, Ek offers this data point:
“In Q1, we saw a 20% increase in the number of artists streamed on our platform year-over-year and a 29% increase in the number of artists with at least 100,000 listeners.
Daniel Ek, speaking to investors on April 29, 2019
The best chance most artists have of being discovered on Spotify is through appearances on popular playlists. We ran the advice of one playlisting professional on our blog last week, and we plan to share more in the weeks to come.
If Spotify’s catalog is growing at this unprecedented rate, it’s highly likely that the same can be said for Apple Music and Amazon Music, as well as their smaller competitors. Streaming may be helping the music business recover from its low point, but it’s certainly not helping developing artists make careers out of their work in the same way physical media sales once did. At least, not yet.
