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Our Planet Money team creates a record label to follow the money to music creators

A MARTÍNEZ, HOST:

How artists get paid for a song in the age of streaming is a bit of a black box. Our Planet Money podcast team wanted to look inside that box, so they decided to become a record label and release a long lost song from the '70s.

(SOUNDBITE OF SONG, "INFLATION")

EARNEST JACKSON AND SUGAR DADDY AND THE GUMBO ROUX: (Singing) Now, people, stop what you're doing. And listen to what I have to say, 'cause inflation is in the nation. And it's about to put us all away.

MARTÍNEZ: The song "Inflation" was recorded by a band called Sugar Daddy and the Gumbo Roux and Earnest Jackson.

EARNEST JACKSON: I've always wanted to be a superstar. That's been my dream since I was a little boy.

MARTÍNEZ: They released the song in October. Then reporter Sarah Gonzalez and Erika Beras wanted to see if anyone would listen.

SARAH GONZALEZ, BYLINE: So how's our song doing?

SAM DUBOFF: You guys are doing great.

GONZALEZ: This is Sam Duboff. He works at Spotify.

DUBOFF: Really impressive numbers for a first song released.

GONZALEZ: Are you just telling us that? Or is it, like, actually impressive?

DUBOFF: It's actually impressive.

GONZALEZ: It is?

DUBOFF: It really is.

GONZALEZ: Two months after our song dropped, "Inflation" had been streamed about 713,000 times across all the sites, Apple Music, YouTube Music, Pandora, Spotify.

JACKSON: Yeah, I have a envelope here. NPR.

(SOUNDBITE OF PAPER TEARING)

ERIKA BERAS, BYLINE: And on March 1, we finally saw how much money our singer and songwriter, Earnest Jackson, got for those streams.

JACKSON: OK, let's see.

(SOUNDBITE OF PAPER FLAPPING)

JACKSON: Whoa. Oh, OK. It was over a grand, y'all. It's over a grand (laughter).

GONZALEZ: Earnest made $1,098.82 on his streaming royalties.

JACKSON: Yes, indeed.

GONZALEZ: Royalties are how you get paid if you own part of a song.

BERAS: We did do the math. And we have figured out, you, Earnest, are getting a sixth of a penny every time someone streams your song.

JACKSON: Oh, OK. A sixth? All right. That's how it goes (laughter). A sixth of a penny. Well, please, in Jesus name (laughter), let those sixths of a penny add up.

GONZALEZ: This is what he's getting with a record deal that we designed to be more favorable to the artist than the norm. By the way, we, the record label, we made $387 on those streams.

BERAS: You get paid based on something called stream share. Basically, you do not get paid per stream or per listen. You get paid based on how many streams your song gets in one month compared to how many streams every other song in the country gets that same month. So for example, we uploaded our song the same month that Taylor Swift dropped her latest album. She got, like, 200 million streams in a day. So our share of streams is a lot less than it would have been if we released our song on a non-Taylor Swift month.

GONZALEZ: And we did do this one big thing to try to increase our streams. We pitched Spotify to add our song to these really popular playlists. And they did. Earnest's song is up there next to songs by Etta James and Jimi Hendrix.

BERAS: And this was big. This put "Inflation" in front of people who otherwise would never find it. But come on, a thousand bucks for, like, almost a million streams? So not satisfying.

GONZALEZ: We needed to reach more people. And there are lots of ways to try to do that, like getting on the radio.

JACKSON: I want you all to get it in all the radio stations in America. That's the main thing that I want.

BERAS: Getting on the radio would bring in more money. It's a totally different royalty from the streaming royalty. And here is how you get a song on the radio. You ask radio stations if they want to play it.

GONZALEZ: So we did. We asked, like, 20 stations - and crickets.

KRISTELIA GARCIA: Right. So it's not easy to be a radio promoter, right? You have to already have relationships with these people.

GONZALEZ: Kristelia Garcia is a music law professor at the University of Colorado. She says we got nowhere because we have no record label clout.

BERAS: Yeah. But also, when we started asking stations to, you know, please, play our song on the radio, we may have been putting out these, like, weird, bribe-y vibes. And in the music industry, weird, bribe-y vibes are known as payola.

GARCIA: Payola, put simply, is paying for placement, paying a DJ to play your song on the radio.

GONZALEZ: Paying for placement is not illegal. The rule is you just have to disclose it. It's just it has a bad reputation.

BERAS: And at times, like in the '70s, it was pretty nefarious.

GARCIA: It could look like, you know, girls and drugs. It could look like any sort of in-kind payment.

BERAS: Sorry. You just said girls and drugs. And it took me a minute. Right, right.

GONZALEZ: Maybe we can send a DJ a concert ticket.

BERAS: We can send them some NPR tote bags, you know?

(LAUGHTER)

GONZALEZ: This kind of payment would be OK.

BERAS: But we didn't go this route because, Kristelia says, instead of paying a DJ, we could just pay for more streams. You can Venmo people with popular Spotify playlists to throw your song up there.

GONZALEZ: Now, Spotify says paying for guaranteed placement is totally against its policies. But some companies, like one called Playlist Push, says they don't guarantee placement.

GEORGE GOODRICH: What Playlist Push does is totally different.

GONZALEZ: George Goodrich is the CEO. He says you just pay them to get your song in front of people who will consider adding your song to a playlist, which is more of a gray area. But we don't love gray areas.

BERAS: So we found a workaround. You can also pay Playlist Push to approach TikTokers to make videos using your song. That also makes us money.

GONZALEZ: Normally, TikTokers are not supposed to disclose that they got paid through Playlist Push. But they bent the rules for us.

BERAS: And after a month, three people made TikToks.

GOODRICH: I think a lot of it is really just the ad thing. They don't want people to know that they got paid to make the video.

GONZALEZ: This whole by-the-book disclosure thing really messes things up for us.

BERAS: So our last attempt to boost our numbers? Ads.

GONZALEZ: We spent over $1,000 on a Spotify ad, which resulted in a whole 68 new people listening to our song. So we made a few pennies there.

BERAS: And as of this recording, "Inflation" has been streamed about 1.3 million times.

GONZALEZ: That puts us in the top, like, 1% of songs streamed on Spotify ever.

BERAS: And Earnest probably won't get much more than $2,000 for that.

GONZALEZ: It is a hard, hard industry. So we tell Earnest we're going old school now.

BERAS: This is the vinyl that we are releasing of your song.

GONZALEZ: So this is your album cover.

JACKSON: Oh, wow.

BERAS: We are releasing it.

JACKSON: Yes, indeed. I'm happy, baby. I'm happy.

GONZALEZ: We are selling Planet Money Records records.

Sarah Gonzalez.

BERAS: Erika Beras, NPR News.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.

Erika Beras
Erika Beras (she/her) is a reporter and host for NPR's Planet Money podcast.
Sarah Gonzalez
Sarah Gonzalez is a host and reporter with Planet Money, NPR's award-winning podcast that finds creative, entertaining ways to make sense of the big, complicated forces that move our economy. She joined the team in April 2018.