Sam Rosenthal pulled Projekt releases from Spotify a year ago because they essentially pay artists almost nothing. Here's an excerpt:
"Spotify claims, "The overwhelming majority of our indie label partners are thrilled with the revenues we're returning to them." Honestly, I doubt that is true. Spotify further claims to be "monetizing an audience the large majority of whom were downloading illegally (and therefore not making a penny for the industry) before Spotify was available."
Yes, it is true that torrents gave no artists any money. Spotify gives all artists almost no money.
For a stream on Spotfy.... NOW READ THIS CLOSELY..... on average $0.0013 is paid to Projekt's Digital Distributor. 5000 plays generates around $6.50. In comparison, 5000 track downloads at iTunes generates $3487. To be clear: I am not suggesting that every stream would have been a sale at iTunes. Believe me, I understand the reality of the music business. I am providing that as a comparison for you. Let's look at this another way: To earn the U.S. monthly minimum wage - $1160 - 892,307 plays a month are needed at Spotify. This is not a viable number for artists.
You have probably seen this article in The Guardian; over a five-month period, 1-million plays of Lady Gaga's hit 'Poker Face' earned just $167. Really.
I talk about this with my 9-year-old son; he fully understands we all have a basic right to earn a paycheck for our work. See this chart for a comparison of how much is earned via different sales formats. To earn the U.S. monthly minimum wage - $1160 - 892,307 plays a month are needed at Spotify. This is not a viable number for artists. It is not that we are even aiming for the minimum wage. We only desire something equitable. $0.0013 per play is not.
In the world I want to live in, I envision artists fairly compensated for their creations, because we (the audience) believe in the value of what artists create. The artist's passion, dedication and expression is respected and rewarded. Spotify is NOT a service that does this. Projekt will not be part of this unprincipled concept."http://www.projekt.com/newsarticles/projekt-spotify.asp