In a letter sent to Uruguay’s Minister of Education Pablo Da Silveira, a spokesperson for Spotify said: “If the proposed reform became law in its current form, Spotify’s business in Uruguay could become unfeasible, to the detriment of Uruguayan music and its fans,” claiming that the amendment would force it to “pay twice” the amount of royalties.
Spotify currently pays out at 70%. Doubling royalties would cause them to pay out more than they make in subscription and ad revenue. This is why they’re shutting down.
they don’t. spotify says they’re paying 70%, but they don’t tell how they redistribute that revenue. they have under-the-table deals with the 3 majors who grabs most of that money, and leave the crumbs to everybody else.
If that’s subscription revenue in Uruguay then the business model is just not feasible, unless they up the subscription fees to adequately cover costs.
This is the risk when the revenue model doesn’t scale with th cost model.
Well that’s damning
Spotify currently pays out at 70%. Doubling royalties would cause them to pay out more than they make in subscription and ad revenue. This is why they’re shutting down.
they don’t. spotify says they’re paying 70%, but they don’t tell how they redistribute that revenue. they have under-the-table deals with the 3 majors who grabs most of that money, and leave the crumbs to everybody else.
70% of what?
If that’s subscription revenue in Uruguay then the business model is just not feasible, unless they up the subscription fees to adequately cover costs.
This is the risk when the revenue model doesn’t scale with th cost model.