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The Web Monetization Big Picture
Let's compare Web Monetization to existing streaming platforms.
We’ve covered how Web Monetization works. You’re now familiar with the components – Coil + digital wallet + payment pointer. We’ve outlined a few ways to get started with Web Monetization as a creator.
To get a full picture of the vision for Web Monetization, specifically how it can help creators, let’s compare Web Monetization with Coil to an important streaming service for music, Spotify.
Many of you have music on Spotify. How many of you have ever received a check from the service?
Spotify’s payout accounting is complicated. A 2020 Business Insider report found that musicians earn as little as $0.0033 per stream on Spotify. However, Spotify does not pay per stream. Instead, it calculates earnings based on “streamshare,” a metric that accounts for both an artist's streams and the total number of streams per that artist’s market.
[Keep in mind: Spotify pays rights holders, which may or may not be the same as the artist.]
In 2022 Clare Mulroy at USA Today analyzed the creator revenue share system at Spotify. They contacted the streaming behemoth for more information on ‘streamshare.’ "Every month, in each country we operate in, we calculate streamshare by adding up how many times music owned or controlled by a particular rights holder was streamed and dividing it by the total number of streams in that market," Spotify explained. (Apple Music also pays on a stream share basis.)
From the article:
The Union of Musicians and Allied Workers found artists were paid an average of just over half a cent per stream in 2018 and under a third of a cent in 2020. The average artist pay rate declined 43% over two years.
Music lovers are taking notice. In August 2022 Congresswoman Rashiada Tlaib introduced House Concurrent Resolution 102. The bill “recognizes the need to establish a new royalty program that would directly compensate musicians with a fairer royalty payment every time their music is listened to on a streaming music service, like Spotify.”
From the press release:
Spotify, the world’s largest streaming service, paid rights holders an average per-stream royalty of $0.0030 – at that rate, it would take more than 800,000 monthly streams to equal the wage of a full-time worker earning $15/hour. According to the UN’s World Intellectual Property Organization, even the current meager streaming rates are declining every year.
You can read House Concurrent Resolution 102 here.
Let’s compare Spotify’s payout policy with Coil’s implementation of Web Monetization.
Coil sends micropayments per second per user. Payments are streamed according to how long the user is consuming – in this case paying attention – to the content. On the supporter side, Coil charges a flat fee of $5 per month. Those fees fund the payouts to content creators.
From Coil’s website:
Coil “streams payments” instantly instead of keeping a running ledger of what each creator and website is due. They pay websites and creators continuously while the subscriber visits their content at a rate of 0.0001 USD/second. Websites can use the proposed Web Monetization API web-standard to check and verify when and how much clients are actively paying them. This can be used to unlock subscriber-only content (like a universal pay-wall), hide ads, or otherwise customize the customer experience.
This payout policy removes the streamshare variable. Your content earns you per second, per user.
Of course, the more Web Monetized users you have visiting your content, the more money you will receive. To date, Web Monetization has not attracted nearly as many users as Spotify has.
Let’s do the math.
Let’s imagine a song streams on Spotify. The song’s duration is 3 minutes, or 180 seconds. Let’s assume 800,000 monthly streams, the figure that Congresswoman Tlaib uses.
With Spotify: 800,000 monthly streams * 0.0033 per stream = $2,640
With Coil: 800,000 streamers * 180 = 144,000,000 seconds * 0.0001 = $14,400
Looking at these stream numbers another way for our 3-minute song:
Spotify revenue per stream: $0.0033
Coil revenue per stream: $0.018
A Note about YouTube
In order to unlock YouTube’s monetization features, your channel needs to have at least 1,000 subscribers and 4,000 public watch hours. YouTube’s monetization relies on advertising. Many YouTube channels rely on brand partnerships to make their channels profitable.
Coil will allow you to monetize your videos. Any Web Monetization member who visits your channel will stream you payments. Additionally, any of your videos embedded in Web Monetized sites or platforms will also earn you money. No need to get your subscriber list to 1,000.