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Spotify Royalties Are Higher Than iTunes Revenues In Europe?

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I don’t know if the Wall Street Journal has some interests to see Taylor Swift back to Spotify, but they are now claiming Spotify royalty payments are exceeding iTunes revenues? I have always read that Spotify was paying pennies to musicians, but the WSJ is now advancing the stupefying news that the streaming service is now starting to pay off for some musicians in European markets … What? How is this even possible, it contradicts everything we have heard so far.

The WSJ got some new data from Kobalt Music Publishing, which represents 6,000 songwriters including Stevie Nicks, Paul McCartney and Max Martin (ironically Taylor Swift’s main collaborator on her last album), and these data show that Kobalt’s writers ‘earned 13% more from Spotify streams in Europe during the first quarter of 2014 than they did from iTunes downloads on the continent’… and this is a new trend as it was not the case during the third quarter of 2013 when writers still earned 32% more from European iTunes sales than from Spotify royalties

What’s the hell is going on in Europe? Because it is not the case in the US. If you want to know more, Willard Ahdritz, Kobalt chief executive, will present the data this week at a technology conference in Dublin, but Mr. Ahdritz insists that streaming services ‘are generating more revenue for songwriters across the board, especially as they enter new markets where download or CD sales long have been negligible’, and for him ‘the trick is to add three times more users’…

You know what? These numbers are probably very misleading, music sales are down as they have never been, nobody is buying music anymore, and Taylor Swift may be the only artist who is managing to sell albums, which is still a mystery to me… so if iTunes sales are down, of course Spotify royalties are going to eventually catch up, this is no rocket science, more doesn’t necessary mean better, 0.0001 is still more than 0.00001, but not much nevertheless. So is this what’s happening in Europe? Are people over there buying even less music (and streaming more in compensation) than Americans? It’s possible, and this could explain the relatively higher revenues on Spotify in Europe.

But did Swift do the right thing by removing her music from Spotify? Sure, she is the only one selling music, and it’s still more profitable for an artist to sell than to be streamed. However, this is a very temporary solution, the music industry is undeniably evolving toward a universal streaming service and she will eventually be back on Spotify.

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