The Finnish Heavy Metal band Mokoma, has publicly thanked Spotify for their payout model. Their Facebook fan page states that for “every 100 album playbacks we get 30 euro cents from Spotify. Thanks Spotify.” The deals that Spotify has struck with different artists have been kept secret, so it is not known if this is the only payout model. However, if there were 1000 people listening to an album and to my understanding would listen it through, Mokoma would get 3 €.
The business model is of course related to the amount of income Spotify is able to generate for the company itself. At the moment the main sources of income are media sales and premium subscriptions. Also, Mokoma has linked to an article in the Finnish press that reveals the ownership of the company and refers to the fact that not much has changed even though a new technology is for the better of the users themselves.
Record labels bought a big chunk of Spotify last October for 100 000 Swedish Crowns, which is less than 10 000 euros. This has thought to be the reason why Spotify has been able to sign so many deals with the major record labels, in the end creating a large enough library of music to interest consumers.
While Jonathan from Spotify keeps on stating that “everyone loves music”, it seems that if the bands aren’t able to create a better source of revenue there won’t be much music to listen to in the future.