As Spotify’s profits stagnate, is music streaming dying out? Enjoy it while you can, experts say
Most of the income from music streaming goes to the artists, publishers and labels, and streaming services are struggling to make a profit. If Spotify can gather 100 million subscribers, it may start to make money
The music business stinks, and that has been great for consumers.
Tens of millions of listeners have been tuning into on-demand, ad-supported songs on music services such as Spotify. Millions more have been paying for music subscriptions, shelling out around US$10 every month for unlimited music.
But the companies offering the services can’t turn a profit, and that means we might have to start looking at new ways to consume music in the coming years. So enjoy Pandora, Spotify and iHeartRadio while you’ve got them.
The filing sheds light on the economics of the streaming business, which has crushed traditional music sales, from CDs to downloads. The takeaway: lots of money comes in, but most goes straight out the door to record labels, artists and music publishers, who all have been saying for years that they don’t get enough. They want more.
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Spotify has 71 million paying subscribers and has been able to fight off competitors such as Apple, Google, Amazon and others, despite the many advantages the well-heeled rivals have. Apple, for instance, has sold more than a billion iPhones. Every time an owner hits the music icon, Apple offers to sell them an Apple Music subscription.