What Indie Artists Make from Digital Music Sales and Streaming

Unknown.jpgCellist Zoë Keating is a successful indie artist. Her unique style of minimalist-influenced music has earned her a dedicated following. She self-publishes her music, selling directly to listeners without the intermediary of a record label.

Keating recently shared her income for 2013 in a spreadsheet on Google Docs. (She had previously shared similar information for the period between October 2011 and March 2012.)

It is interesting to examine how much money an artist makes from digital sales and streaming. Note that, since Keating self-publishes, she retains all this income; an artist working with a record label would get a smaller amount of money from the different services, depending on their contracts. (Most likely half or less.)

For the year 2013, Ms. Keating earned just over $75,000 in sales, and slightly more than $6,000 from streaming. (Ms. Keating does not say how much she made from physical sales, nor what percentage of her income or sales digital and physical represent.)

What’s interesting is the number of streams and how little they pay. From Spotify, Keating earned about $0.0044 per stream, whereas Spotify claims they pay “an average “per stream” payout to rights holders of between $0.006 and $0.0084.”

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To be fair, Spotify does stress potentially higher payments as more people use Spotify, but it’s basing its current low-ball business model on the premise that more and more people will stream music, which will reduce overall sales. It’s clear in Ms. Keating’s case that, with sales generating more than 10 times streaming income, increased streaming – with the resulting drop in sales – paid at such low rates, would lower her overall income.

Keating’s album sales were not brilliant, but she did not have a new album in 2013, so all the sales were back catalog. It’s interesting that nearly as many singles as albums were sold on iTunes, if you count an album as being worth 10 singles. On Bandcamp, however, only a handful of singles sold, and album sales were about 3/4 of what iTunes netted. Also, Amazon MP3 sales are low because this only represents sales from albums from 2005 and 2006, and “because I don’t have a digital distributor and amazon mp3 doesn’t work with artists directly,” as Ms. Keating said on Twitter. It seems that, if this is true, she should either get a digital distributor, or indie artists like her should put pressure on Amazon (if that’s possible) to allow artists to sell directly, as iTunes does, and as Amazon does so profitably with Kindle ebooks.

What is shocking is how much YouTube paid Ms. Keating. For nearly two million “streams,” she earned a mere $1,247. YouTube has become the go-to place for pirated music. People upload music to YouTube, illegally, and Google does little or nothing to stop this. (There is a complaint process, but it is very complex. And one needs to constantly monitor what content is uploaded. Because Google is delighted that YouTube has turned into this gray area of soft piracy.)

So Zoë Keating earned just under $82,000 from music sales and streaming in 2013. Some of this income is offset by expenses; those albums weren’t free to record, edit and release, after all. Again, this was a year when she didn’t have a new recording, so she had, most likely, lower expenses, but recording costs should be amortized over the life of an album.

This is yet another example of how difficult it is to make a living as a musician these days. One thing missing from the equation, however, is the amount of money Ms. Keating has earned from performances, and the amount of expenses need to be taken against the sales. Remember, these are gross sales, not net income. You may think that these numbers translate into a fair amount of money for a niche musician, but when you get to the bottom line, there’s much less.

So, go out and buy an album by an indie artist today; don’t let the music die. You could buy one by Zoë Keating, or by plenty of other artists, such as The Durutti Column.