Sales vs. Spotify

(Note: These charts are not all the exact same week. The SoundScan singles and album charts are for the week ending 1/11/15, as is the global Spotify streaming chart, whereas, unfortunately, the Spotify U.S. streaming chart is for the week ending 1/18/15. I could wait until all the charts align, but I'm inspired now, and I believe the insights remain true.)

1. "Uptown Funk" Mark Ronson

This sold 340,776 singles in the U.S.

But it got 4,842,359 streams on Spotify in the U.S.

How many times did each person play the track they bought?

However, in the history of "Uptown Funk" sales, 2,097,503 tracks were moved. So, if everybody who bought one played the song 2 times, they'd match the Spotify streams.

However, in the history of the track on Spotify, "Uptown Funk" has been streamed 81,564,715 times. Alas, that's a worldwide. number.

So let's try to get some equivalency, which is hard to do.

Streams trump sales.

But streams pay less than sales.

But streaming only pays...when a track is streamed!

And, streaming is a worldwide phenomenon.

Furthermore, Spotify is just a percentage of streaming, there are competing streaming services and, of course, YouTube.

So...

Focus on listens. That's where the whole game is moving. Fans are made by listens.

2. "Thinking Out Loud" Ed Sheeran

Sold 223,519 for a cume of 1,413,677.

Streamed 3,881,860 times on Spotify in the U.S.

However, "Thinking Out Loud" is number three internationally on Spotify, it was streamed 12,446,973 times.

In the history of Spotify, "Thinking Out Loud" was streamed 165,300,622 times.

Ed Sheeran's album "X" has been out for 29 weeks in the United States.

But the single has only been on the chart for 16 weeks.

A lot of things drive the streams of tracks. Most definitely radio.

But it appears that the labels and radio are losing control of tracks by hit artists. Because you can see what is successful from the get-go with albums. Every track is streamable upon release on Spotify.

And "X" is number two on the album chart.

But Sheeran only has three cuts in the U.S. Spotify top fifty.

Sam Smith has two tracks in the U.S. Spotify top fifty.

Meghan Trainor has two.

Ariana Grande has two.

But these multiple tracks in the top fifty are all "hits."

If albums were everything, you'd see more tracks by an artist in the top fifty.

Now if you go to the iTunes Top Songs, you'll learn that Fall Out Boy has seven tracks in the top 200, with two in the top fifty.

Fall Out Boy only has one track in the Spotify top fifty.

So, what we learn is the sales chart is not an accurate picture. It skews for today in a world that's all about tomorrow. Yes, music is about careers, longevity. Even tracks are about longevity. So, Fall Out Boy gets a lot of action in week one of their album release, how about week ten, never mind a year in?

So, looking at the Spotify top fifty, we learn that we live in a hit single world. You can talk all you want about albums, but most people are listening to singles. A vast spectrum of them. Meaning there's room for you on the chart if you make something desirable, you're not being crowded out by the usual suspects.

(Note: Hozier's "Take Me To Church" is number two on the worldwide Spotify chart, with 325,599 more streams.)

CALVIN HARRIS

His album "Motion" is number 39 on the sales chart. A middling performance after ten weeks, you'd think he doesn't matter that much.

But Calvin Harris is an international superstar! He's got two tracks in the Spotify worldwide chart, "Outside" has 7,818,475 streams and "Blame" has 6,726,978 this week.

"Blame" has 166,657,483 streams worldwide on Spotify since its release.

"Outside" has 87,436,344 historical streams.

"Blame" is number 64 after 19 weeks on the SoundScan sales chart. It sold 23,986 copies for a cume of 691,764.

"Outside" is number 117 in sales, 15,322 this week, a cume of 147,151.

"Blame" was streamed 1,439,052 times on Spotify in the U.S. this week.

"Outside" 1,417,394 in the U.S. this week.

They were the number 25 and 29 tracks on Spotify in the U.S. respectively.

So what we learn is people stream Calvin Harris more than they buy him. And he's much more popular on streaming services.

"Firestone" Kygo

Not even on the sales chart, it's like Kygo doesn't exist.

But "Firestone" had 1,160,665 streams in the U.S. last week. It's number 41.

But it's number six worldwide, with 6,990,370 spins on Spotify.

CONCLUSION

And now I'm sure your head is spinning. You're confused. Not only because the charts are not the exact same weeks, but because there are so many charts, so many statistics!

So what have we learned...

1. It's a worldwide business.

Consolidation rules. Live Nation is a worldwide business, never mind BMW. He or she who sees the world as their marketplace ultimately triumphs. And now it's easier than ever to reach the entire world. Spotify functions in a plethora of countries. You can go direct and make all the money, or...you can go with one company and demand a worldwide rate, with no deductions. That's right, with one payer, why should you get screwed, why should you wait for your money? We're going that way. And this is a good thing.

Furthermore, we're going to day and date worldwide release. The public demands it. Hell, they do it in the movie business, it's the best way to fight piracy.

2. Listens are everything.

Streams dwarf sales and you get paid on each and every one, in perpetuity, or as long as the copyright holds, which is nearly perpetuity in the United States.

Focus long term.

And know that once a track is released, it's in the hands of the public. You can try to influence people, but they can also influence the system. Data goes both ways. When you put out an album, see what the people are streaming, those are the hits.

3. Hits are everything.

Turns out most people don't stream the album tracks. Sure, superstars have multiple hits, but the money is in the hits, that which is streamed prodigiously.

So, you should not focus on making an album-length statement so much as putting out that which will be streamed, assuming you want to get paid, and since everybody is bitching about Spotify payments, it looks like they do, want to get paid that is.

You have instant data, an instant response. Pay attention and use it.

4. The elephant in the room.

YouTube. Which pays so much less per view/stream.

The two official Vevo Calvin Harris videos on YouTube have been streamed a combined 116,428,272 times. Imagine if everybody paid ten bucks a month to stream YouTube clips!

But they don't. Google is trying to get them to do so, but right now they don't.

It's Spotify that has some people paying that amount, millions, in fact.

And Spotify is not alone.

That's right, right now Spotify does not own the streaming market. You can listen on Rdio or Rhapsody or Deezer...

Or you can steal and no one gets paid.

So we've learned that streaming has won. And the goal is to get as many people as possible to pay.

5. The data.

"Billboard"/SoundScan has a new album chart.

If you think the above is incomprehensible, try checking that out.

The main statistic is "Total Activity." A certain number of track sales equal an album sale and ditto with streams. As if buying enough bicycles gets you a car. Or buying enough toothpicks gets you a tree. And according to "Billboard"/SoundScan, "Taylor Swift" had no streaming activity during the week ending 1/11/2015. But the truth is she's all over YouTube.

So what does the "Billboard"/Spotify chart mean?

NOTHING!

We need to go to a pure stream model.

How many times a track is streamed on all services, that's all that counts.

We want an accurate count, not a manipulated number.

And we're going to get there.

The good news is we're close.

But vested interests have their thumb on the scale, they're afraid to go to the all streaming model, that would mean they're losing control.

But the truth is music is a business, which demands professionals. And there's so much music out there that you may be able to get started independently, but you need pros to push you over the top. I.e. major labels, or their equivalent.

And Apple is not going to buy Universal. No tech company is going to buy a music company. The margins are not good enough and the headaches are legion.

However, to focus on the revenue from recorded music only is to be myopic. Records are the free joint that gets someone to buy an ounce.

And if you don't understand that metaphor, you don't know weed is legal in Colorado and gays can get married and albums are history.

Your goal is to create a body of work, that people listen to endlessly.

And at the end of the day that's made up of tracks.

And payment for those tracks is going up, and the slot machine will pay off forever.


--
Visit the archive: http://lefsetz.com/wordpress/
--
http://www.twitter.com/lefsetz
--
If you would like to subscribe to the LefsetzLetter,
http://www.lefsetz.com/lists/?p=subscribe&id=1

If you do not want to receive any more LefsetzLetters, http://lefsetz.com/lists/?p=unsubscribe&uid=0eecea7b60b461717065cbde887c8e25

To change your email address http://lefsetz.com/lists/?p=preferences&uid=0eecea7b60b461717065cbde887c8e25




-- powered by phpList, www.phplist.com --