For several months, I’ve heard a lot of complaints on how little Spotify pays indie artists. So I was kind of surprised that very few picked up the story that Spotify is actually, well, starting to pay indies more.
Evolver.FM said that a confidential report from Merlin (the indie label
trade organization rights agency) is showing strong revenue growth from Spotify. The reason is an increase in subscribers and usage overall. One would also suggest that the Facebook integration is starting to show up in royalty statements in recent months as well.
As an indie label owner, I get the pain of small micro payments. But I also get the concept of patience. We all dream that our song will be released, spread like wildfire, and generate huge instant digital revenues. Lately, Bob Lefsetz has been promoting the idea that great music finds its audience no matter what, further reinforcing a false notion that great things are instant successes.
But let’s take a look at one of the biggest songs of 2012: Fun’s “We Are Young”. This is the Google search trending for the song over the last year. The song was released in September 2011. This critically acclaimed song produced…barely a ripple. In fact, it didn’t do much until the spike in December which was the result of appearing on the show Glee. Then it dropped off, though maintained a higher popularity than before the show. But it wasn’t until the use in a Super Bowl ad that everything kicked into high gear and the upward ascent began. This popular hit did not go viral out of the gate. It took traditional TV placements for people to see it.
The success occurred because everyone was patient. In fact, the band’s manager Dalton Sim said as much in a Billboard cover story in March.
From my perspective, the success comes from the hard work the band, Nettwerk Records and Fueled by Ramen have put into the band for the last three-plus years to develop a real fan base.
So when it comes to services like Spotify, it appears that patience just might pay off as well. At one point, YouTube didn’t pay anyone. Now they are a top revenue driver for many artists. Financial success at any level is not an overnight story for artists or companies for that matter. However, working towards those greater successes can yield bright futures for all.
UPDATE: As Jim Mahoney of A2IM pointed out, Merlin is not a trade organization, but a rights agency.