How Does Digital Distribution Work?
There are many benefits of digital distribution, but it is not without its drawbacks.
Here are some of them:
Disadvantages of digital distribution
While the advantages of digital distribution far outweigh the disadvantages, there are still some important differences between the two. While this type of distribution is more flexible and provides greater re-monetization opportunities, some businesses may feel limited by the restrictions it places on it. Here are some of the disadvantages of digital distribution. This method is not suitable for all products. Disadvantages of digital distribution include limited audience reach, lower average revenue per viewer, and difficulties with traditional re-merchandising.
Purchasing digitally-distributed media is not free. You must pay for the product in full before downloading it. Moreover, you cannot exchange or trade it for another product. This means that digital games and other electronic products have no resale value. Purchasing digital copies of these products is a one-time investment. However, you may have a genius mind who discovers a way to exchange digital media for physical products.
If you are an independent artist or songwriter, you may be interested in learning about Spotify digital distribution. Spotify is expanding their services and have a list of preferred distributors and digital delivery platforms. If you are considering submitting your work to Spotify, you should know that the top three distributors are CD Baby, DistroKid, and EmuBands. These distributors adhere to best practices in the music industry and comply with Spotify’s strict quality and metadata standards. You can also choose to distribute your music through these channels instead of uploading it directly to Spotify.
For indie artists, Spotify allows direct uploading of music to its platform. The company has in-house sync agents and a robust music library searching system. They also recently launched their own digital distribution arm in June 2018, offering artists a free distribution service with 0% commission through 2020. The company was founded by Victoria and Paul Wiltshire, and began as a sync licensing service. Spotify acquired a minority stake in DistroKid in October 2018; despite the financial interest in DistroKid, the company is a completely independent music distribution company.
Streaming music is a lucrative business for music labels. Spotify is able to retain up to 15 percent of the revenue from ad sales. However, the deal with Sony has some complications. Unlike Apple, Spotify has 800 different rates for each stream. This means that an individual stream from a US user will earn more than a stream from an Indian user, who will pay less than a US user. Therefore, Spotify’s deal with Sony Music is not completely transparent.
Spotify’s open platform typically revolves around two basic services: an aggregator package for music creators and an aggregator package for music lovers. This package lets the creators upload their music, which makes it available to hundreds of DSPs around the world. For this, the distributor charges a flat per song or album fee, an annual subscription toll, and a commission ranging from five to 15 percent. If you decide to distribute your music to Spotify, you can be confident that your music is protected and will remain available in the platform for a long time to come.
A significant benefit of Spotify is that it provides an option to independent artists to self-publish their music without having to go through a record label or third-party aggregator. Spotify also provides the option to sign direct deals with artists, so they can control their own fates. The majority of the money goes to the artist’s record label, which splits the remaining 50% of the monthly revenue with the artist. The artist can make up to 50% of their royalties directly from the platform.
Almost all distributors are involved in trade marketing. The level of engagement varies, but most provide tools for promotion, best practices for pitching to editorial teams, playlist pluggers, and rep consultations. However, not all distribution companies are as active as Spotify in providing trade marketing services. Most distribution companies will not offer you access to a direct upload option unless you are an independent artist or songwriter. If you are a music creator, you should consider getting in touch with these companies.
A Los Angeles-based talent management firm, Human Re-Sources, has partnered with YBN Nahmir to release his music in digital distribution. This new label offers artists greater control and freedom in their creative process, unlike traditional record labels. The company has signed a partnership with Spotify and is uploading music to all major streaming platforms. Here’s a look at the new company’s mission. Founded by J. Erving, the company aims to give artists the freedom to express their creative vision.
The company’s A&R team includes J. Erving, who has twenty-plus years of music industry experience. Her team is aware of music culture and is up-to-date on the latest trends. Major record labels, on the other hand, rely on analytics and statistics to determine the best releases. Human Re-Sources balances analytics and gut feeling to maximize profit for the artist and distribution company.
The company has also signed J. Erving, a Philly native who previously managed Nelly and Eve. Erving will serve as a strategic partner for Sony’s recorded music teams. Sony will use his expertise to identify new talent for its label. Erving will be reporting to SME Chairman Rob Stringer and The Orchard CEO Brad Navin. Currently, Human Re-Sources has signed artists such as Bren Joy, Pink Sweat$, and YBN Nahmir. Streams generated 2.5 billion streams in the past year alone.
As part of the Sony Music Entertainment acquisition, Human Re Sources, an LA-based artist distribution company, will merge with The Orchard, the global independent music distribution company. Erving will continue to lead the company while serving as Executive Vice President of Creative Development for the company. The Orchard will continue to sign and develop artists directly. This deal will open the door to a global distribution company for independent artists.
Besides signing new artists, Human Re-Sources is also expanding its British roster. In addition to Matilda Cole, the label has also signed up young rapper Lancey Foux, beat-heavy songwriter ADMT, and rising singer-songwriter Matilda Cole. These new signings are all poised for success. Among their impressive list of talent, Christian Alexander has 120,207 monthly Spotify listeners. And Oscar Welsh is set to release his debut EP next year.
Sony Music’s recent acquisition of Human Re-Sources will create a platform to further streamline digital distribution. Sony will be able to leverage its own content and expertise to reach its goal of distributing a broad variety of music. The company’s stock has recently hit a record-high of $325. Its market cap is $60 billion. The deal will also increase Sony Music’s presence in the independent music distribution space.