Twitch has always been popular amongst the gaming community. It was created initially in 2011 as a platform for gamers to use in order to live stream as well as broadcast live Esports events and competitions and has since retained on average 15million daily users.
With so much more of our time spent online due to the Covid-19 pandemic, Twitch has expanded in regard to what they broadcast and live stream: talk shows are growing in popularity as well as live streamed music to name but a couple.
As the date for the resumption of normality approaches and with it the reopening of concert halls and live shows, one can speculate as to what will happen to those artists that have decided to make use of these live streaming platforms as a source of income.
Twitch users reportedly spend three times as much time on the platform as on Sportify and YouTube so the potential for it to be a very lucrative platform for music makers and artists is what has been looked into by Will Page, an economist who runs Tarzan Economics. He worked alongside various teams in order to understand how live streaming and live music may co-exist in the future.
“Live streaming won’t go away when live music returns.”
-Will Page
In 2002, one of the first music streaming services Rhapsody, offered a $9.99 monthly price which is the same as what we see today for similar music streaming services.
What is provided is also pretty much the same as what was offered in 2002; fans remain largely disconnected from their favourite artists, they are unable to offer direct compensation to creators, and ‘cross-usage’ occurs frequently as a listener is often subscribed to multiple platforms.
“None of the on-demand streaming services that have since sprung up enable immediate engagement, this is a relic of the music industry of old.”
-Will Page
User engagement is something that both Twitch and Jeeni offer, and not only does it allow the fans to be more involved with the artists they love, but it allows the artists to be fairly compensated, a huge issue which is now being petitioned against by the Broken Record Campaign. See our last blog post for more information and ways that you can support the campaign.
According to Will Page, the typical music streaming model has approached the way in which artist are compensated in one way:
“the platform aggregates all the streaming data and revenues from a specific market and product over a specific time period, divides an artist’s share by that sum, and allocates revenues proportionately. Get 1% of all the streams, and you’ll get 1% of all the money. This has spurred much debate within the industry, as heavy streamers are effectively subsidised by light streamers, or as Quartz controversially put it: Your Spotify and Apple Music subscriptions pay artists you never listen to.”
In essence, the modelling simply just isn’t fair, and neither rewards the artists or their fans for supporting them.
The way in which Twitch brings in money, however, varies across three methods similar to Jeeni: Creator Channel Subscriptions, Bits allow users to support creators directly on the service, and advertising.
Will Page made a comparison between creator earnings on Twitch, which average at $0.15 per-hour-per-user, with that of global streaming services at which the rate per-stream is set at roughly $0.003.
By taking the $0.003 per stream and multiplying by 17 (assuming a song lasts 3 minutes this equates to an hour of listening time), then applying an average 20% royalty rate, this results in a creator’s “revenue-per-hour listened” at just $0.01.
My jaw dropped, did yours?
Twitch has proved it can monetise over 10 times better than music streaming, however this only applies to creators’ most loyal fans that tune in on a regular basis.
"If you keep the full $100 of each true fan, then you need only 1,000 of them to earn $100,000 per year."
-Kevin Kelly, The Technium, 2008
Do you want to spend hours watching your favourite gamer and at the same time, fairly compensate and reward them for their time and effort? Well of course. What Twitch does for gamers, we want to do for music makers and artists here at Jeeni.
Look out Twitch, we’ll meet you at the finish line.
