Technology
How Many Music Streams Does it Take to Earn a Dollar?
How Many Music Streams Does it Take to Earn a Dollar?
A decade ago, the music industry was headed for a protracted fade-out.
The disruptive effects of peer-to-peer file sharing had slashed music revenues in half, casting serious doubts over the future of the industry.
Ringtones provided a brief earnings bump, but it was the growing popularity of premium streaming services that proved to be the savior of record labels and artists. For the first time since the mid-90s, the music industry saw back-to-back years of growth, and revenues grew a brisk 12% in 2018 – nearly reaching $10 billion. In short, people showed they were still willing to pay for music.
Although most forecasts show streaming services like Spotify and Apple Music contributing an increasingly large share of revenue going forward, recent data from The Trichordist reveals that these services pay out wildly different rates per stream.
Note: Due to the lack of publicly available data, calculating payouts from streaming services is not an exact science. This data set is based on revenue from an indie label with a ~150 album catalogue generating over 115 million streams.
Full Stream Ahead
One would expect streaming services to have fairly similar payout rates every time a track is played, but this is not the case. In reality, the streaming rates of major players in the market – which have very similar catalogs – are all over the map. Below is a full breakdown of how many streams it takes to earn a dollar on various platforms:
Streaming service | Avg. payout per stream | # of streams to earn one dollar | # of streams to earn minimum wage* |
---|---|---|---|
Napster | $0.019 | 53 | 77,474 |
Tidal | $0.0125 | 80 | 117,760 |
Apple Music | $0.00735 | 136 | 200,272 |
Google Play Music | $0.00676 | 147 | 217,751 |
Deezer | $0.0064 | 156 | 230,000 |
Spotify | $0.00437 | 229 | 336,842 |
Amazon | $0.00402 | 249 | 366,169 |
Pandora** | $0.00133 | 752 | 1,106,767 |
YouTube | $0.00069 | 1,449 | 2,133,333 |
*U.S. monthly minimum wage of $1,472 **Premium tier
Napster, once public enemy number one in the music business, has some of the most generous streaming rates in the industry. On the downside, the brand currently has a market share of less than 1%, so getting a high volume of plays on an album isn’t likely to happen for most artists.
On the flip side of the equation, YouTube has the highest number of plays per song, but the lowest payout per stream by far. It takes almost 1,500 plays to earn a single dollar on the Google-owned video platform.
Spotify, which is now the biggest player in the streaming market, is on the mid-to-low end of the compensation spectrum.
The Payment Pipeline
How do companies like Spotify calculate the amount paid out to license holders? Here’s a look at their payout process:
As this chart reveals, dollars earned from streaming still don’t tell the full story of how much artists receive at the end of the line. This amount is influenced by whether or not the performer has a record deal, and if other contributors have a stake in the recorded work.
The Pressure is Heating Up
When Spotify was a scrappy startup providing a much needed revenue stream to the music industry, labels were temporarily willing to accept lower streaming rates.
But now that Spotify is a public company, and tech giants like Apple and Amazon are in the picture, a growing chorus of industry players will likely dial up the pressure to increase compensation rates.
Technology
The World’s Biggest Cloud Computing Service Providers
Cloud computing service providers generated $270 billion in revenues last year, concentrated among a few giants.
The World’s Biggest Cloud Computing Service Providers
This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.
Today, the three largest cloud computing service providers command 66% of the global market.
Amazon, Microsoft, and Google have generated billions in revenues through their cloud infrastructure that provide the computing power companies need to store data. What’s more, most AI models are run on the cloud, creating a surge in computing demand for cloud providers.
The above graphic shows the largest cloud providers globally, based on data from Synergy Research Group.
Breaking Down the Cloud Market
Here are the world’s top cloud computing service providers based on enterprise revenues as of the fourth quarter of 2023:
Provider | Country | Market Share Q4 2023 |
---|---|---|
Amazon Web Services | 🇺🇸 U.S. | 31% |
Microsoft Azure | 🇺🇸 U.S. | 24% |
Google Cloud | 🇺🇸 U.S. | 11% |
Alibaba Cloud | 🇨🇳 China | 4% |
Salesforce | 🇺🇸 U.S. | 3% |
IBM Cloud | 🇺🇸 U.S. | 2% |
Oracle | 🇺🇸 U.S. | 2% |
Tencent Cloud | 🇨🇳 China | 2% |
Other | 🌐 Other | 21% |
With 31% of the global market share, Amazon’s cloud division posted $24.2 billion in revenues over the quarter.
AWS is a major cash engine for the company, but growth slowed over 2023 as enterprises and startups cut back on tech spending. Annual sales growth compared to the same quarter last year grew by 13%—far below competitors Microsoft and Google, whose cloud divisions grew by 30% and 26%, respectively.
As we can see, U.S. firms make up the lion’s share of the market, while China’s Alibaba Cloud and Tencent Cloud together comprise 5% of the global share.
The AI Boom and the Cloud
Given that a significant chunk of AI models are run on the cloud, the industry may be positioned to see greater demand as momentum accelerates.
In fact, newer AI systems are as much as 10 to 100 times larger than older models. In line with this, major cloud providers are seeing high demand for cloud services to allow companies across financial to manufacturing sectors to run large language models on their platforms.
Today, 98% of companies globally rely on the cloud for at least one part of their business applications, which may present a market opportunity for the industry as advancements in AI continue to grow.
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