Spotify is Now Worth More Than the Whole U.S. Music Industry
Earlier this month, reports came in that Spotify have received $400 million in fundraising, totalling the streaming service’s value at $8.4 billion. The news came shortly after a large media push from Jay-Z’s streaming service, Tidal, which criticized Spotify for poorly recompensing the artists it streams.
Well, the Wall Street Journal just reported that Spotify is worth more than the entirety of the US music industry. For reference, Spotify’s revenue is more than double what Pandora, the streaming service’s closest competitor, makes at $3.5 billion. The Recording Industry Association of America (RIAA) reported that the total revenue of the industry in 2014 was about $6.97 billion, which includes physical and digital sales, as well as streaming. Streaming accounts for about 27% of the revenue, and almost all of that is thanks to Spotify.
On the other side, Tidal just fell out of the iPhone’s top 700 downloaded apps. Despite Jay-Z and Jack White calling new subscribers personally, consumers aren’t convinced. It seems that America didn’t react too well to the Tidal launch event, which featured music giants like deadmau5, Madonna, and Rihanna, where co-owner Jay-Z called for proper payment for music artists. America doesn’t seem to think that RiRi needs even more money.
Beyond these streaming services, there is still a serious problem with payment in the music industry. Geoff Barrow of Portishead claimed that he made a little over $2,550 after 34,000,000 streams on Youtube and Spotify. So how do we make sure that artists are compensated properly without breaking the bank? We can’t say for sure, but the need for reform is becoming clearer and clearer.