I’ve noticed a growing trend in online music sites. They’re free, FREE, FREEEEEE for everyone, and they’re gonna make all kinds of money for artists. How is this possible, and if it’s such a great deal, why aren’t musicians making millions of dollars?
Here’s the common example (taken from an actual website called jamendo):
Can the Artists earn money with jamendo?
Yes they can! Jamendo enables all the users to make a donation to the Artists with a minimum of 5 Eur (or Dollars). In any case, jamendo retains as little as 50 cents for financial fees, the remaining sum is directly given to the Artists…But there is more, jamendo shares 50% of its advertising revenues to the Artists who opted for the Program ‘Revenue Sharing’.
Sounds pretty good, right? You, the loyal listener, donate a minimum of $5 to support a (probably struggling) artist. The middle-man (Jamendo) only takes “as little as 50 cents for financial fees.”
Wait, read that again.
As little as 50 cents. Not as much as 50 cents. This basically says that the MINIMUM amount taken from loyal listener before it gets to struggling artists is 50 cents, but there’s NO limit. They could actually be taking $4.99 and not have violated their stated user proposition.
Another classic premise involves sharing ad revenue. Using Jamendo as the example, they offer a 50% share on ad revenue on your page. So, let’s assume (they’re using Google ads…) that you get $0.02 per ad click on from your page. That means (in the most simplistic terms) you get a penny if someone goes to your page and clicks on the ad.
Pretty cool, right? Not so fast. The great majority of the bands on there don’t drive much traffic. Maybe they’ll make $1.00 per month. And so does Jamendo. But suppose Jamendo has about 50,000 artists doing the exact same thing.
Monthly payout per artist: $1.00
Monthly payout to Jamendo: $50,000.00
There’re all kinds of sites, some with more favorable rates, that offer things like this. So the next time you hear someone buzzing about Sellaband.com, SlicethePie.com, TheSixtyOne.com and others, think about what happens to your sponsorship dollars. If you’re giving money to a band and assuming it all goes to them, well, think again. Who’s really seeing the money?
