Manatt Entertainment Leader Jordan Bromley and Financial Analyst Trent Smith wrote an article for Billboard about how Spotify’s decision to bundle audiobooks with its premium subscriptions will affect payments to songwriters.
With this change, Spotify reduced the reported service revenue from music, attributing the rest to audiobooks, resulting in songwriters receiving a substantial payment decrease. Bromley and Smith explain the nuts-and-bolts financial effects of this change as it relates to songwriter payments.
While this bundling decision affects Spotify streaming’s musical content in total, less than of 1% cost saving is reflected. The authors wrote, “Spotify should reverse course immediately and find 1% savings somewhere else that doesn’t work to decimate the revenue of millions of American songwriters, the lifeblood of our treasured American music industry.”
Billboard subscribers can read the full article here. Use Manatt’s Streaming Royalty Calculator to see how much musicians are paid per stream on Spotify and Apple Music here.