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How Does Streaming Pay?

July 7th, 2016
contra, music, money  [html]

When the Free Raisins put out our studio album we signed up with CD Baby for digital distribution. They're very vague on how much you earn this way:

Every one of our digital music partners pays differently, but the average we pay out is 60 cents per song downloaded, $6.50 per full-album download, and fractions or whole cents per stream (when people listen to your song as if on a radio station, but don't download or buy it). Remember we pay you 91% of the total income from digital distribution, keeping only a 9% cut.
CD Baby FAQ

Our album has now been up for about two years, so I thought I'd see what we're getting paid for streaming. [1] All numbers are how much we got; that's after CD Baby's 9% cut.

Channel #streams per-stream payment
Spotify 7458 $0.00298665
Google Locker 214 $0.00029294
Rdio 195 $0.00259000
iTunes 167 $0.00781138
Google Music Store 155 $0.00931066
Amazon Cloud Drive 142 $0.00227943
iTunes Match 104 $0.00117343
YouTube Music 52 $0.00477044
Deezer 29 $0.00452452
Groove 22 $0.04171718
Rhapsody 19 $0.00890842
iTunes Radio 4 $0.00099782
Tidal 2 $0.01382660
Omnifone 1 $0.01879669

Spotify is by far the biggest of the streaming services for us:

On the other hand, the best-paying platforms are the smaller ones:

I wanted to make sure that Groove wasn't an error here, so I looked at the details for those plays. Here's plays over time, with time on the x-axis, payment per play on the y-axis, and the size of the bubble indicating the number of plays:

(I don't know what happened in November 2014 for that month to be much lower.)

So they really do pay ten times as much as Spotify per play. I think maybe what's happening here is that they don't have a free tier, which means they have much more money available per play?

How to evaluate this financially?

  • We did earn back the $49 we paid CD Baby for their "Standard Distribution Bundle."
  • If these ~8.5k streams displaced even ~3 CD sales, we lost money.
  • If these ~8.5k streams added even one additional booking, we gained money.

Plus, if people enjoyed listening to it, that counts for something.

(In general, thinking about this sort of thing it's hard to tell whether to compare it to traditional radio, which paid musicians nothing, or to traditional sales, which paid pretty well.)


[1] The majority (two thirds) of digital income was actually from track downloads, not streaming, and nearly all of that was through iTunes, at $0.637/track. Other channels, each of which has sold only one of our tracks ever, are iTunes-UK ($0.823), iTunes-CH ($0.807), iTunes-IL ($0.404), and Amazon MP3 ($0.637). Track downloads account for two thirds of our digital income, with the other third being streaming.

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