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Old 12-21-2012, 07:03 AM   #3
Top100EbooksRank
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Posts: 304
Karma: 6102528
Join Date: Mar 2012
Device: Kindle
Here's the payout rate from subscription music.

http://www.digitalmusicnews.com/perm.../120604youtube

per source: "Payable to Artist/Label via digital distributor for sales from July to December, 2011."
(Rhapsody purchased Napster last year, though the Napster name continues in various European territories.)

Zune
15,159 plays
Payout = $437.58
$0.028 per song
Ratio = 25:1 iTunes Song Download

Napster
30,238 plays
Payout = $479.07
$0.016 per song
Ratio = 43:1 iTunes song download.

Rhapsody
50,822 plays
Payout = $668.57
$0.013 per song
Ratio = 53:1 iTunes song download.

Spotify
798,783 plays.
Payout = $4,277.39
$0.005 per song.
Ratio = 140:1 iTunes Song Download



Keep in mind that only Spotify has free streaming (5 million paying subscribers + 15 million free users). Without free users, Spotify will pay about the same rate as Rhapsody. The downside to offering free streaming: huge losses.

Spotify CEO recently said that the company could be profitable tomorrow if they wanted it but their focus right now is on growth and more growth. Spotify lost something like $50 million in 2011.

Free users is great for growth since 20-25% of them will convert to paid user (eventually). But it is a drag on profits since every free user will result in a few dollars loss per year for Spotify.

Last edited by Top100EbooksRank; 12-21-2012 at 07:05 AM.
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