How Bad Is It? Read the fine print…

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As lower margin streams destroy higher margin sales, this chart tells you the best you can hope for.

And don’t miss the fine print at the very bottom of the chart:  “Revenue based on 91 cents per download and .00575 cents per stream”

Hits Streaming

In other words–cooked numbers.  You can’t use an average per stream income penny rate because the difference between ad supported and subscription rates is so vast. The subscription rate will ALWAYS pull up the ad supported rate, especially if you don’t adjust for the difference in subscribers–much higher for free and much lower for subscription.

Nobody makes .00575 cents per stream on ad supported streaming (see Zoë Keating’s royalty statements).  Ad supported is the lions share of Spotify streaming based on the ratio of paid to free accounts that Spotify releases–which are unverified.

Do you know anyone who actually gets paid “91 cents per download” on a 70 cent wholesale price?

This suggests that the revenue column for streaming is overstated–maybe wildly overstated.

Source: Hits Magazine

4 thoughts on “How Bad Is It? Read the fine print…

  1. Aside from the faulty analysis on streaming, the authors of that chart have made a key error in calculating the sales revenue. The mechanical rate is not 91 cents per download, but 9.1 cents per download, so their figures are 10 times higher than they should be.

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