Music

Musicians eye steady cash in Spotify deals

spotify

The opening numbers are displayed on the floor during the Spotify IPO at the Dow Industrial Average at the New York Stock Exchange on April 3, 2018 in New York. PHOTO | AFP

Summary

  • The official unveiling of the famous bright green logo with frequency waves in Kenya is a milestone in the evolution of music streaming in Africa.
  • As of February 23, Spotify, the world’s most popular global audio and streaming service is now available in Kenya, Ghana, Nigeria, Tanzania and Uganda.
  • Spotify’s business model is based on revenue generated from subscriptions and adverts, and therefore more revenue translates into higher payouts to artistes.

The official unveiling of the famous bright green logo with frequency waves in Kenya is a milestone in the evolution of music streaming in Africa.

As of February 23, Spotify, the world’s most popular global audio and streaming service is now available in Kenya, Ghana, Nigeria, Tanzania and Uganda.

Spotify’s business model is based on revenue generated from subscriptions and adverts, and therefore more revenue translates into higher payouts to artistes.

Spotify is today the largest music streaming company in the world with 70 million songs, 2.2 million podcasts, and four billion playlists and a user base expected to surpass 350 million in 2021.

“There is an opportunity for artistes and content creators to generate revenue from streams in new markets and to build fan bases, which in the long term will lead to opportunities to perform and engage with a wider audience,” says Mike Strano, founder of PHAT! Music and Entertainment.

Spotify is launching in a market that already has some big players including Boomplay with 75 million users and 47 million songs, and Mdundo which is a download service, boasting seven million users and 1.5 million songs.

“These streaming services have only made a dent in the one billion strong audiences in Africa, so the cake is big enough for everyone,” says Strano.

“I expect Spotify to grow the understanding of streaming and grow the potential market of streaming that will benefit the other players. The biggest competition is from piracy, not among music streaming services,” says Strano.

“Piracy is robbing these streaming services and content creators of money that is due to them,” he adds.

Strano says Kenyan laws have also been strengthened under Section 35 of the Copyright Amendment Act which outlines an internet service provider’s liability to block a customer’s access to sites that are responsible for piracy.

Other music streaming services like Mdundo and Boom Play are already part of the Partners Against Piracy lead by the Kenya Copyright Board and Strano says the entry of Spotify will lend weight to the anti-piracy efforts.

“Digital has checked piracy because you can control the source and access to the source. That means there is more money going into the pockets of the rightful owners of the content,” says Strano. Kenyan music on Spotify is categorised under Made in Kenya and Gengetone Fire with a catalogue that includes recent songs by artistes like Nviri the Storyteller, Bahati, Elani, NaiBoi, H_art the Band, Sauti Sol and Blinky Bill.

“This is a great platform with a global reach and every Kenyan artiste should ensure their music is on Spotify,” says DJ and producer Blinky Bill.

His music, both as a solo artist and with the group Just A Band, has been available on Spotify, even before the service was made available in Kenya.

He explains that artistes have to understand the process of going through a distribution channel (aggregator) to get their music released on Spotify. These distributors charge a small fee or deducted from royalties.

Bill channels his music through the CD Baby digital distribution channel, which then gets the songs on to multiple streaming and download outlets, including Spotify, Amazon, and Deezer.

“As recording artistes and other content creators, the arrival of Spotify is another opportunity to generate revenue, and to make our brands available on the biggest digital space in the world,” says Bill.

The service offers insights through Spotify for Artists for musicians to view real-time statistics on how their content is streaming and monitor how the music is faring in different geographical locations. He says that technology is the answer to an outdated royalty system that lacks transparency. Royalty payment depends on the location of listeners.

“The world of music has changed and so artistes have to embrace technology because there is more harm in being off these streaming platforms than there is being on them,” says Bill.

“Even if you just regularly earn just Sh4,000, it would be much better than the Sh2,500 royalties that the Music Copyright Society paid members in 2019,” he said.