Photo: Kanye, Donda and Stem Player
The idea that the music industry has taken advantage of artists is not a new one. Now by examining how much money giant streaming services in collusion with popular record labels actually pay musicians, the fact that artists are being ripped off is nothing but apparent. The sad truth of this is hidden behind streaming services like Spotify and Apple Music’s refusal to release the true accuracy and totality of how they equitably distribute the currency that they rake in each month.
Not only do they make money off of advertisements that adhere to their free subscriptions, they charge a monthly fee to all users who choose to listen to their music ad-free. The un-believableness of how much an artist makes per stream has contributed to why certain big-name artists are attempting to reclaim the rights and financial control over the very music that they put their heart, soul, and livelihood into. Jay-Z, who founded the streaming service Tidal, has made the service one the highest pay-per-stream platforms for the artists whose music and discography it features.
Now Kanye West is attempting to shift the paradigm of how listeners receive and experience their music, which will be primarily and wholly financially beneficial to the actual creator of the music. With Kanye’s new Stem Player, a Bluetooth music speaker which can alter the sound and style of any music played through it, Mr. West is addressing the issues of monetary compensation; first-handedly, and is changing the music industry and its exploitation of artists and their work for the better.
Kanye West Leaves Apple Music and Spotify to Solely Promote His Next Album on The Stem Player
Kanye West has recently announced the exclusive release of his new upcoming album, ‘Donda 2,’ on the Stem Player, a collaborative innovation in technology that is primarily designed for musical enthusiasts. The Stem Player allows users to edit and alter any aspect of a song that they play through this Bluetooth speaker. By allowing free form, personal creation, and adjustment to existing songs, Kanye as well as Kano, the company that has co-created the audio adjuster, intends to shift how people experience and interact with traditional music and songs. Though the most significant aspect of the Stem Player, and its exclusive, ‘Donda 2’ release is not the revolutionary technology that the Stem Player features. Rather, it is Kanye’s decision to not allow the distribution of his new album on any other musical platform or streaming service. His personal decision to withhold the rights to his own music, and intentionally limit where and how listeners can access this album marks the beginning of a change in how artists and musicians can fully and fairly be compensated for their work. Pricing the Stem Player at $200, Mr. West has recently announced that in one day they made more than $2.2 million.
He wrote, “To earn the $2.2 million we made on the first day on the stem player the album would have had to stream 500 million times.” He went on to say, “We did more revenue on stem player, without the album even being out, than we would have done with the album being out on streaming.” “The next day, he revealed that the Stem Player had secured $9.5 million in lifetime net revenues to date; equivalent to around 47,500 total unit sales.” To be able to earn that amount of money by streaming with Spotify, which on average pays its artists $.004, his album would have had to have been streamed, at that price point, 2.375 billion times. Kanye’s brilliant decision to exclusively release ‘Donda 2’ solely on the Stem Player has already resulted in a massive financial accumulation for him and his brand.
Not only has this resulted in great monetary success for Kanye, it has resulted in a shift away from the exploitation of artists by big-name streaming companies. Kanye revealed earlier this week that Apple offered him $100 million for streaming rights to ‘Donda 2’, which he turned down. Mr. West has remained steadfast in his belief and goal aiming to put the power and personal control of artists’ rights to their music back into their own hands. In the words of the Stem Player’s co-founder, Alex Klein, this device allows the artist and creator to lead the “conversation and set the value on the work that they put out in the way that they think is appropriate.”
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What Kanye West’s Transition to His Own Music Distribution Platform Symbolizes for The Music Industry and Other Artists
Kanye West’s transition away from traditional music distribution and streaming symbolizes a coming change to the music industry. Kanye, in one of his recent posts on Instagram wrote, “Today artists get just 12% of the money the industry makes. It’s time to free music from this oppressive system. It’s time to take control and build our own.” The sad truth is that of the eight million creators that have uploaded to Spotify, only 2.3% earn more than $1000 per year, and of that group, only 0.8% earn more than $5000 per year making music. With each group making discernibly more money after that, the percentage continues to exponentially drop off to where only 0.1% of creators make more than $100,000 per year.
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This can be viewed in current times as an adequate living for one’s craft. The percentage of musicians that can actually make a living off of their passion for music is so minute that it highlights the issue with how Spotify rewards its creators. With Spotify revealing that it made ~$11 billion in revenue in 2021, the vast disparity between the amount of wealth and income that Spotify accrues and how much they pay their artists whose labor is what actually attracts subscribers is starting to become readily apparent. Spotify, before its debut in 2011, in order to appease the major record labels, including Warner Music Group, Sony, and Universal Music Group, gave them an 18% stake in the company. This stake has gone to net these major labels and record companies hundreds of millions of dollars. On top of this, every time that Spotify is required monthly to pay an artist for their music, in actuality the artist is the last one to get paid.
Spotify prioritizes the payment of the rights holders and the distributors before an artist ever sees a single cent.
Apple has “announced that it pays artists a mere penny per stream,” and while that is an improvement and more than double on average than what Spotify pays its artists, it’s not trailblazing by any regard. It is not nearly as much as other smaller music streaming services pay their artists. Streaming platforms such as Bandcamp, Tidal, Napster, and a few other smaller streaming companies are all known to be higher paying for their creators than the two biggest music streaming services, Apple and Spotify.
This fact emphasizes the words by Kanye West and foregrounds the consequence of what he is trying to achieve by removing his future projects from the hold and influence of Apple and Spotify. By taking back control of his own artistic commodities he is proving that it is not the artist that needs these big-name streaming services, but rather it is Spotify and Apple that needs them. Spotify and Apple Music are built on the backs of musicians and Kanye is showing that there could be a future where these artists no longer need the services that these streaming giants provide.
Does The Music Industry Fairly Reward Its Artists, or Does It Only View Them As A Source of Revenue?
At this point, it is fairly accurate to say that the big-name streaming services are solely interested and invested in their own success, and financial profit no matter the cost to the individual creator. It is clear that they operate with a business model of putting their own needs and vast financial gain over that of the musicians whose work allows these streaming services to be so successful. Singer and composer Ashley Jana, at a music conference in 2019 stated that, “Spotify was created to solve the problem of piracy, not to pay people money.” The lack of opportunities afforded to musicians by streaming companies like Apple Music and Spotify ensures that they hold a monopoly over the industry and they set the standard and determine exactly how much artists deserve to get paid for their work.
With reports that it takes around 250,000 streams to earn a $1000 with Spotify, and 136,000 streams to earn the same amount of money with Apple Music, these services have made it incredibly difficult to make a living for the artists that upload their music to these platforms. With artists like Kanye West to challenge the status quo, there is a coming shift in the paradigm. There have been many cries calling for change and with the success of the Stem Player, that change may have already come. What will be crucial to see is how artists like Kanye can not only ensure their own success and freedom from the constraints of the streaming giants, but rather ensure monetary freedom for other smaller artists who do not have the same voice or influence among society.
By Thomas Jacobs
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Thomas Jacobs is an avid writer, Cinema aficionado, and filmmaker. He graduated with Dean’s Honors from the University of California, Santa Cruz with a major in Film and Digital Media. His passion is directly tied to the appreciation and creation of film and television, and this fact is reflected in his intent to be a writer for the acclaimed entertainment journal, The Hollywood Insider. His beliefs mirror the core goals and mission statement of The Hollywood Insider by sharing an admiration for quality entertainment as well as bolstering a sense of positivity and equality among all humans. Thomas believes that Cinema is an advantageous promoter of civil and social empowerment, and he shares a mutual societal view with The Hollywood Insider, that people should not be judged by the color of their skin, but the content of their character.