Based on this http://www.spotifyartists.com/spotify-explained/ the current distribution method is basically:
1: Divide the total revenue by the total number of streams to get X.
2: Pay X * the number of total streams of an individual rights holder to that rights holder.
This has several flaws out of which 2 seem really unfair to the artists:
1: The shorter the song the more streams it can get therefore this penalizes long songs that usually already are a niche category.
2: The method assumes that the people who stream much bring much revenue.
The problem with 1 is especially with classical music where the "songs" can easily be 10+ minutes long. When compared to a radio hit that are usually really short, always under 4 minutes, this just doesn't seem fair to the long songs. The paying customer uses the same amount of time to use Spotify but generates far less royalties to "her/his" artists.
The problem with 2 is easily explained through a real example. I'm a subsrciber and so is my mother. I easily listen to music 5+ times as much as she does but I don't generate any more revenue to Spotify. But the artist I listen to get 5+ times as much as royalties from Spotify. I really feel this is not fair.
My suggestion is to change the royalty distribution method into:
1: Keep track of the revenues by user / account.
2: Keep track of streams by user / account.
3: Divide the revenue by a user by the number of streams by that user to get X.
4: Pay X * the number of total streams of an individual rights holder by that user to that rights holder.
This would fix problem 2 completely and would fix problem 1 at least partially since most people have the tendency of listening more or less similar music and the really long songs are usually limited to only a few music genres.
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