You must have read about Indie labels pulling their music from Spotify, because of low revenues.
But not all Indie labels are this pessimistic about the effect of a release on Spotify. Element9 decided to release Idle Warship’s album, “Habits of the Heart” on Spotify three weeks before the retail release.
This is what Element 9 Vice President Stu Pflaum told Bob Lefsetz today:
It really is all about taking risks these days and the old model has to be destroyed. I recently made the decision to release our label’s latest album on Spotify three weeks ahead of street date. The execs I’ve spoken to on the move think I’m crazy. They say Spotify doesn’t generate enough revenue to risk pissing off retailers by showing favoritism to the new player in town. I’ve responded by saying if retailers are concerned about our dealings with Spotify, it reassures me that we’re moving in the right direction.
Since the release went live on Spotify we’ve streamed the album over 70K times. I know what skeptics will say; our revenue from those streams is about $7. Who cares? Our web traffic has more than tripled in terms of site visitors & discussion. Nobody is pirating the album even after we’ve distributed promo copies. And most importantly, we’re getting real-time feedback from listeners on which tracks they favor and are able to adjust our marketing accordingly with most of our budget still intact. The group & the album have a legitimate buzz now.
We’ve got to get rid of this old model where all of our moves are made to impress retailers. Our budgets aren’t big enough to burn money with radio & video promotion for singles that might not succeed. The music has to come first. Let the fans have the keys to the car. They don’t care about first week sales.
Great to see a label that thinks different. Good news for Stu. According to my latest data the 70K streams so far should be good for $ 371 Way more than the $7 he expects.
You may think, he would have earned more without the prerelease, but I doubt it. You have listeners and buyers. My observation: both groups stick to their habits. Listeners keep listening and buyers keep buying music. The big change is that most of these listeners used to download illegally. Now they are streaming, thus creating additional revenue. Why do these downloaders switch to streaming? Because of convenience. It’s so easy!