The Reality Of Monetization In The Streaming Era

Longtime musician, Jeremiah Bowser, recently shared his streaming revenue for the month of August: $8.63 for 3,600 plays. That’s less than what he used to make selling a single CD at a live show. His story sparked a bigger conversation: are podcast creators heading toward the same trap musicians face in the streaming era?

In this episode, we compare the realities of music streaming and podcast downloads, break down who actually makes money (from Taylor Swift to indie acts), and reflect on what this means for podcasters. Should monetization be the goal, or just a cherry on top of a passion project?

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Transcript

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Kevin 0:00

So a friend of mine. He's a musician. He's been a musician for as long as I've known him, so 20 plus years. His name is Jeremiah Bowser. If you want to look him up great musician has tons of CDs. Probably has recorded eight to 10 CDs.

Kevin 0:12

I don't know a lot of music over his career and I thought it was interesting. He decided to share some revenue stats with his fans. The takeaway was that his streaming totals for August he made $8.63 across all the streaming platforms for his music, all the songs combined Wow. And it got me thinking, because we talk to podcasters a lot and podcasters all the time are talking about how they can make money podcasting. Where Jeremiah has landed is that in his follow-up he said I would make more selling one CD than I do on 3,600 streams.

Kevin 0:47

The music business is a business only for the top few and for the rest of us it's purely a passion project, which is something we talk about all the time in podcasting. Like, you should be podcasting If you love podcasting, if it's a passion project for you, you shouldn't go into it if you desire to make money. But I've never sort of connected the dots or thought about it from the musician side as well. There's also hundreds of thousands of people who probably make music like Jeremiah does, who do it for the love of making the music. They don't actually make a lot of money on it. Anyway, I thought it'd be interesting for us to talk about. What do you guys think?

Alban 1:20

I like it because there's this temptation in podcasting like, oh, I'm getting into it so I can quit my day job and I can do this full time.

Alban 1:27

This is going to be my big breakout. I don't think that temptation's there for most people with music. I think mostly what you have is someone who falls in love with music and they're mostly playing covers in the beginning and they start making their own music and they're really enjoying it and they book a show and they go and play publicly and then if they decide to go full time into it, it's because I know this is unlikely to succeed, but I love it so much I might move to Nashville and you know, and try to get a record deal and maybe a healthier way to think about it is like even in music, the likelihood of success is so low. Podcasting may end up being similar where it's yeah, most people are just going to enjoy it and unless you're enjoying it in the way that a musician who plays covers and maybe does one show every three months, unless you enjoy it like they enjoy it, it may not be the right fit for you.

Kevin 2:22

I was honing in on the part where he said the music business is only a business for the top few, and the rest of us do it as a purely passion project.

Jordan 2:30

Yeah.

Kevin 2:30

And so I fired up my GPT and I went to work so I started punching in some numbers to try to get who the top artist was, who was making the most in streaming, sort of a middle of the rung. And that's really hard to find a middle of the rung because once you kind of go out of like the top 10%, five to 10% of artists that you've heard from the numbers drop off significantly.

Kevin 2:51

So what really? What I'm saying is, like the top person, who happens to be, according to GPT anyway, like Taylor Swift, seems to be making the most off of the streaming revenue, which is ironic because she withheld her music from Spotify for a long time. But anyway, she's in there now. She seems to be making the most. And then, like if you did a list of the top 500, the number 500 band that I found was a band called Flip Turn, which I've heard of my kids. Listen to them.

Alban 3:12

I don't listen to them that much, but I've heard of them.

Kevin 3:22

Sounds like a skateboarding trick. They're actually a really great band, anyway, but they're not doing stadiums, okay. And then I have Jeremiah Bowser as, like an indie, he's in the you know the 200,000, 300, 500,000 musician group. There's a bunch of them, okay. So Taylor Swift making somewhere between 16 to 25 million let's just call it $20 million a month in streaming revenue alone alone. No merch, no endorsement deals, no concerts, none of that other revenue that she's making, just streaming revenue alone. Around $20 million a month.

Kevin 3:51

Flip turn this is the band that consistently, two or three times a week, is selling out somewhere between $5,000 and $10,000 arenas. They are doing about 100 million streams a month and they're making about $400,000 off of that. I think that's just their percentage. That goes to their label. I actually don't know how much of that that they get, but I think their label is making about $400,000 off of their music. Okay.

Kevin 4:13

And then you have Jeremiah Bowser, which in August he made $8, but he said sometimes it's more, sometimes it's less. It can be up to like $14. So somewhere between eight and $14 a month. The disparity there is. Exactly what he's pointing out is like you can't be a musician, especially like in the, in the current world of streaming services. I think there used to be this world where he would go and book a gig and maybe he gets a hundred or 200 people there. He plays a lot of. He plays Christian music, so he gets. He does a lot of shows at churches and stuff like that and I think he would set up a table afterward and sell CDs and he'd sell the CDs for 20 bucks a pop and he'd make you know 12 to $14 of that would be profit on that CD and he'd sell a hundred of them a night can't do that anymore because his music is on Spotify and Apple music and YouTube music, whatever all the platforms are.

Kevin 5:00

So nobody wants to buy the CDs anymore. So really that revenue stream is gone for him and all he can do to make money is the price that he gets paid for the gig and streaming revenue, and the streaming revenue is less than one CD. It just got me thinking, like the amount of time, effort, energy that he puts into this, it only pays off if he's, you know, if he's getting something out of it, and he does. He loves creating music, he loves being a musician, he's passionate about it. It gives him a lot of life to be able to pursue this, but he can't do it as a career. And so many podcasters I think we have had an unhealthy relationship with the idea of monetizing a podcast.

Jordan 5:37

Yeah.

Kevin 5:38

There are going to be the top performers. You know, like, who's the equivalent to Taylor Swift in the podcasting world? Well, it's Joe Rogan. Now Taylor Swift is a whole nother level Like she's making $20 million a month just on stream.

Jordan 5:49

Actually, I think Taylor Swift is the Taylor Swift of podcasting, since she broke a world record.

Kevin 5:57

But there are people at the very tippy top of podcasting who are making really good money, and then there's probably another 500 to 1,000 who are making a living. And then there's the rest of the world. Of the 400,000 podcasts that publish on a regular basis and are considered active, I would venture to say that 99% of those they don't make their money back. They spend more on their hobby than they recoup and I'm just wondering do we have an unhealthy relationship with it, like the fact that we put monetization tools inside of Buzzsprout? Is that a good thing or a bad thing? Is that feeding this unhealthy relationship with something that should be a passion project? Or is it okay if somebody's like no, if I just make $5 a month on my podcast that's better than nothing.

Jordan 6:44

I'm happy with that. I don't think it's like a mutually exclusive sort of thing, like if I think about someone who loves needlepoint and maybe during the summers they go and sell their needlepoint at the local farmer's market because they want to share whatever their hobby is with other people and maybe recoup some of the money and you know they can buy more needle pointing stuff, right, it's one of those things where it just supports your ability to have a passion project, especially, especially in this economy. You know it's expensive to do all this stuff and so I don't I don't see that there's an unhealthy level of monetization. I don't. I think that kind of the narrative or the culture around monetization can be unhealthy in the way that advertisers are perpetuating the story of monetization, and I think that it's one of those things where people are just willing to throw programmatic ads haphazardly into their episodes just for the sake of monetizing, regardless of if it degrades the quality of their podcast. I think that's where it starts getting into the unhealthy territory.

Alban 7:43

To play devil's advocate. I could see an argument, kevin, for a company like Buzzsprout, not Megaphone, like we're working with indie podcasters almost exclusively. Megaphone is the opposite. Acast is the opposite. They're working primarily with really big podcasts that are trying to do big deals and they're selling a ton of ads For us to put in monetization Into Buzzsprout and have it be one of these main tabs. It almost feels a little bit like If Jordan's needlepoint kits Came with a thing that said hey, three steps to selling your needle point for profit at the local farmer's market. Like she knows she could do that.

Alban 8:24

But it may not be the healthiest thing when you first start to start seeing that tab right off the bat, because that tab implies a lot of people are clicking on this tab and they might feel like, hey, maybe, uh, maybe we're making a lot of money over here. But if they knew that most podcasters are making what I'll call Jeremiah Bowser money like $7, $8 a month, and even when they're doing well, you may end up going oh, I need to reframe this. This is a hobby, this is something I love. I'm sharing a message with the world. I'm unlikely to turn this into a full-time gig and just it's.

Alban 9:05

You know from the beginning the relationship could be healthier, that if it turns into something bigger and you make money, that's really cool, but 99% of the time you expect it won't work out that way. I mean, there's just this period really it felt like 2018 to 2022, where every conversation at like conferences would be around how do I make the most money, and I felt like I was always the one who had to break it to people. You're probably it's not going to. It seems like it's improved a little bit, but it's a little bit surprising, I guess, that so many people still kind of come into it thinking like this is probably going to pay off.

Jordan 9:39

Yeah.

Kevin 9:40

You know, trying to make this in my mind, I was trying to make it apples to apples between like a music stream and a podcast download and I was thinking, if Jeremiah, he does 3,600 streams for last month in the podcasting world, that would be a really successful show.

Kevin 9:55

We would put that in the top 5% of all Buzzsprout podcasts that do that. And then I was trying to connect, like how much talent you have to have to be able to do this. As a musician Like he spent years learning how to play his instruments. Well, he's spent thousands of dollars buying very expensive instruments and recording equipment. He's done talent searches to try to find the right musicians to accompany him on songs. Then thousands of dollars to rent recording space to be able to record songs, to be able to, you know, put them together again, originally as in CD format, but now you're just publishing them to the different streaming platforms. So he's just invested thousands and thousands of dollars, hundreds, probably thousands of hours and honing his craft, learning how to write songs that people enjoy. And I was trying to compare that to like who am I as a podcaster who, just you know, one day grabbed a microphone and convinced Alvin that we should start doing a show?

Kevin 10:48

And then we're like okay, buzzcast is born, like in our first episodes were terrible and we've gotten a little bit better over the years, but the talent level was not equal and the investment was not equal in any way and it almost seems like it's a lot easier in some ways to make money as a podcaster than it is as a musician. Yes, shockingly right that's that should be shocking.

Alban 11:11

If we do the math, so 3,600 streams. Let's just use that number as downloads. That came out to be eight, 63. Okay.

Kevin 11:21

Yeah, you're trying to get like a CPM on this, yeah, so $3,600,000.

Alban 11:27

Multiply that by, let's say, you got three ads at $15 CPM. So good, but not like top-notch CPM.

Jordan 11:35

Yeah.

Alban 11:36

That's $162 a month yeah.

Kevin 11:39

You could probably cut that in half. Let's just say you're using programmatic or something.

Jordan 11:43

Yeah, it's going to be like seven bucks.

Alban 11:44

Right. So programmatic, where we're selling them for $7. We're only putting in three ads. Yeah, now we're looking at $81. I mean, that's 10 times as much as music. That's actually kind of crazy.

Jordan 11:57

Yeah.

Alban 11:57

Yeah, I mean probably even to get the for Jeremiah to make that money. The level of quality is pretty dang high, right, so maybe? Wait, am I making the opposite point? Then everyone needs to be monetized in their podcast. People who do music should quit and really need to jump into making shows.

Kevin 12:13

Well, we know it's just not realistic. Like, in order for a podcaster who's doing 3,600 downloads a month to be able to get a programmatic deal where they're getting anything more than $5 CPM is really difficult. And then you have no control over the ads and of course, there's the consistency with those ads filling every month. It's actually going to end up being less than $20 at the end of the day. That's really what's going to be in the podcasting world, but it's still just as much or more than a musician who has massive amounts of talent and skill and has invested tens, or 20, 30, you know, thousands and thousands of dollars over years to get their craft to where they can actually produce songs that are on these streaming platforms in the first place. So I don't know where I landed. I landed somewhere in between.

Kevin 12:56

Podcasters have an unfair advantage if they want to make a little bit of money on their craft, versus musicians. Musicians, it's a much bigger hill to climb and I also landed in this place of like it's the wrong mindset to have in the first place. Like Jeremiah has landed in this very healthy place of you do it for the passion and for the love of of doing what you're doing and hoping that your message and your music is reaching people and moving them in the ways that you want to connect with them. That's why you do it, and if there's eight bucks at the end of the month, then that's a cherry on top of the sundae, but that can't be the motivator.

Jordan 13:28

Yeah, it's so funny because I think when I looked at his posts, what immediately came to my mind, instead of it just being like a passion project kind of thing, was almost like it feels like the music industry and like the ad and royalty system of the music industry is almost like a cautionary tale for podcasting, where if you're not like really intentional about how you support your craft, then it can degrade into this thing where you're getting like point zero007 cents per download or play. And so I feel like there's opportunity for indie musicians to, instead of just relying on like royalty pooling percentages to make money from fan support or from, you know, sites like True Fans who are trying to do the value for value system. So I think that that might be a better future for independent musicians and for podcasters to not rely so heavily on these programmatic ads that are pretty unreliable.

Kevin 14:34

And maybe there's an opportunity for musicians to learn from podcasters Like maybe next time Jeremiah Bowser books a gig at the local venue and has 200 people show up to listen to his music, maybe he should play a couple songs and then pause and tell people about his new Casper mattress and how rested he is.

Alban 14:53

If you think I look great tonight, it's because I slept on an amazing Casper mattress. Use promo code Jeremiah Bowser to get $8.73 off your next purchase.

Jordan 15:04

Oh man, why can I actually picture this happening in the future? Sponsored concerts.

Alban 15:11

This is what we need, Kevin. Great, great point.

Jordan 15:15

I guess this is a good segue, because musicians have fans and next episode we're going to be talking about how to turn your listeners into super fans. So if you have any comments or questions about you know, turning listeners into super fans, or if you are a super fan of a podcast maybe you can tell us why you're a super fan of a podcast Go ahead and tap the Texas show link in the show notes and we will try to incorporate it in our next episode. So until next time, thanks for listening and keep podcasting.