Why Beatport Is Slowly Killing Small Electronic Music Labels
For many, including my own, Beatport has become the place to be for electronic music. Whether you are a DJ searching for the latest releases, a label selling electronic music, or a listener who wants to be up to date with new dance tracks, Beatport covers it all. However, looking great on the outside, especially from a consumer’s perspective, Beatport has a shadow side and it seems not many are aware.
(If you’d like to skip to my recommendations only, you can find them at the end of this article in bold font.)
The Good Looks
Ever since discovering Beatport as a DJ and listener, I have been a huge fan of the platform. It’s easy to use, the catalogue covers a wide range of electronic music genres and every label that takes itself seriously can be found on the platform. Sure, some genre definitions could be a bit better, but that’s a minor issue compared to what the platform has to offer.
Several times a year, Beatport runs awesome discounts (usually 10–30% off, sometimes even 40–50%) which are perfect moments for DJ’s to update their (digital) collection and to add to this, Beatport launched a subscription model called Beatport Link, which makes it possible for a DJ to stream every track in the Beatport backcatalogue for a relatively small monthly fee.
For artists and labels there are several charts in all genres, who provide great content to share on social media. In addition Beatport introduced Beatport Hype. Additional charts and featured releases on the genre home page for relatively small labels (less than $10,000 yearly sales) to generate additional possibilities for small labels to receive some attention, next to the big players. A very thoughtful and supportive solution that seemed to value music over money.
There’s no question why Beatport still is the industry standard for everyone involved in electronic music. But shouldn’t there be questions?
The Shadow Side
Since running my own label I have seen a different side to Beatport as well. The platform seems to be on a sliding scale, ever since their almost bankruptcy and avoiding it*. The platform made several changes over time which obviously were beneficial to Beatport, as the platform seems to be profitable again, but some seem to make more sense than others.
For example, Beatport added new genres to the platform as well as Beatport Hype, however, these choices seem driven by popularity, contrary to make content easier to find for a user. Some could argue that Progressive House, Organic/Downtempo House, Deep House and Melodic House all have overlap and seem very similar, but they all have their own genre specification, while Hard Dance is a mess containing a wide range of genres, including UK Hardcore and Happy Hardcore, Hardstyle, very hard Techno, Frenchcore, Industrial Hardcore and Terror. All genres that at least should deserve their own nametag. Still, this isn’t by far the worst of decisions Beatport has made.
They killed of sections such as Beatport Play and Beatport News, which probably took a lot of time to maintain without much profit. But, as a user, I loved reading these news updates and Beatport Play offered a lot of quality remix contests. Even just competing in those or browsing the entries was a lot of fun.
During the first global lockdowns because of COVID, Beatport decided to experiment with lower prices for their files (up to 30% off). After assessing the trial period, these lower rates were implemented indefinitely because the trial showed that overall labels made more money doing more sales for lower prices compared to lesser sales on the higher price. While this might be the case for a huge label like Armada, small labels like my own hardly saw an increase, but still received less for their sales. And with increasing prices for everything, I can’t blame people for having other priorities than buying music currently.
Beatport never did a reassessment it seems, so I assume sales in general are still on point, as the prices are still unchanged. As a small label, I’ve only experienced decreasing sales figures the past year, against a growing amount of label followers. Now I get that Beatport can’t satisfy anyone or ask anyone’s opinion, but making it optional to take the lower rates or go back to the higher prices at least would have handed smaller labels an opportunity to experiment with what would’ve worked best for them.
Hype Mainly Good For Beatport
With the introduction of Beatport Hype, it seemed that Beatport had an eye for smaller labels and made a virtuous move to offer more exposure for small and independent labels and artists this way. Yet, it’s not all chivalry and charity. First of all, labels have to pay a monthly fee, to use Hype. This seems small ($9.99/€9.99 excl. VAT), but let’s say a label earns 50% of revenue on a track and a sale brings in a netto fee of $0.60. In order to make back the monthly fee of Hype alone, a label needs to sell 33 tracks each month ($9.99/$0.30). And that’s just break even.
Furthermore, being featured in the new Hype picks on a genre home page increases these sales. But in order to be featured, a label has to fill out a questionnaire for every release to be considered. (Maybe this is different for some, depending on the distributor.) Doing so still doesn’t guarantee any features and often seems to be a waste of time when a release isn’t selected. This could come down to the quality of releases, but having been featured almost weekly on the Trance genre page in the first year of the label (2020) and often releasing the same artists on a regular basis, I doubt this is the case.
Personally, I think there’s other forces at play. Despite stating in their own Terms and Conditions that a Hype label should not exceed yearly sales of a total of $10,000, during the first COVID spread in 2020 they decided to widen this range to $15,000. A significant difference allowing bigger labels to become eligible for Hype, especially in a small genre like Trance.
The funny thing is, that allowing bigger labels to Beatport Hype is a straight contradiction to their own Terms and Conditions, seen in this excerpt:
As an example, Reason II Rise Music just launched and is a Hype label. However, it’s a label created by Darren Porter, with a first release by Darren Porter as well. Now, I don’t have anything against Darren and his awesome music nor the fact that he started a label, but he is a huge name in Trance music! In other words, it’s exactly the same as the example given in the Beatport (Hype) T&C.
Another way to circumvent the Hype qualifications is for big labels to split up and simply subscribe their sublabels to Hype. Examples are FSOE Parallels (from Future Sound Of Egypt), FSOE Clandestine and Enhanced Progressive (from Enhanced Recordings). These labels are offshoots of much bigger labels and probably should be considered the same as well-established artists.
Why this all is important, is, because it raised the bar significantly for truly small labels to either qualify for Hype features or charting in the Hype Top 100. A chart created to hand exposure to smaller labels, next to the big main (genre) Top 100, but instead offers more exposure to already well-known artists and labels.
Less exposure and features leads to less visibility on the site. Less visibility leads to a decrease of sales. A decrease of sales leads to a much tougher challenge to even make the threshold of sales to break even with the Beatport Hype subscription fee, especially in a less popular genre.
As a label you are now torn between cancelling Beatport Hype with the knowledge that getting featured between the regular labels is close to impossible, or keeping it so your artists still have a chance to chart (and share these on socials) but probably lose a large part (if not all) from any profit you make from your Beatport Sales.
For Beatport this isn’t a problem, because any sign up from a new sublabel brings in a guaranteed fee of $9.99 a month and raising the sales limit to $15,000 seems to have brought in a bunch of new Hype labels too.
Beatport Link The Final Nail In The Coffin
In 2019, Beatport launched another invention, Beatport Link. Not rolled out on a large scale, it probably started to gain some traction in 2020. For those who don’t know, Beatport Link is a subscription based streaming model aimed at DJ’s. Link has developed so it can now interact with DJ software including the club standard Pioneer setups. For a DJ, the huge benefit is that for a relatively small fee (lowest subscription was $14,99) you have access to the full backcatalogue of Beatport without the need to download and backup files while paying a much larger amount of money to build up a collection of tracks as well. Add to this that on the most recent statement I received approximately $0.035 on a Link stream (10x Spotify at least!) and this finally should be the good news show for small labels and artists, right?
Unfortunately not. In case of a small label, it’s not uncommon to receive DJ-support only once or twice. While previewing tracks (in full) is totally free for Link subscribers and don’t count towards streams, as a label you’d only receive the revenue over those 2 plays. That would make a total revenue of 7 cents. Where in the past, that same DJ bought the file and the label would receive at least $0.60 for that sale (on 100% split). That’s a value or income loss of almost 90%.
Not even taking into account that there’s no clear information on how subscription fees to Beatport Link are divided, but it seems they are divided over all streams from the Beatport backcatalogue. This means the largest players get the largest piece of the pie (same as Spotify, another not so musician friendly platform). Contrary to a DJ buying the file (where the money ended up directly with the label or artist(s) involved) this could mean that a Beatport Link DJ heavily supporting a small Trance label musically, still sponsors big labels or popular genres financially with his subscription.
In the meantime, last week I received an email from Beatport stating that Beatport is evolving, lowering the Link subscription fee to $9.99. Hurray, even less crumbs to share with the massive backcatalogue!
In all fairness, Beatport did launch a new mobile app for Beatport Link****. I personally didn’t sign up to Link and don’t use the app, mainly because I don’t trust most internet connections in shady clubs yet and rather bring my own stash of music (whether on USB, CD or vinyl). So, I cannot tell if the app is sort of Spotify for electronic music. I am sure it would definitely help to increase streaming numbers on tracks. But this also has a downside. Small labels and small genres would relatively grow less in streams compared to big and popular ones and their share from the total pie would further decline. This could also mean that receiving $0.035 for a stream isn’t guaranteed.
This makes the current situation for a small label (active in a small genre, double fun) very difficult. Sales have decreased. The prices on these sales have decreased. Getting exposure on the platform has been increasingly harder. And if Beatport Link finally gets the upper hand and sales reduce to practically zero, this would mean another potential loss of income of at least 90%, while at current rates turning profits already is an illusion given all the costs involved with a release.
Beatport Link is presented as the flagship of Beatport****. It’s probably what Beatport wants to push most as a service, also given the amount of emails I receive to sign up with Link. But it’s also the final nail in the coffin of small labels who try to get by, if nothing changes.
Questions Must Be Asked
I don’t get why there aren’t more questions. Why electronic music artists and labels still want to be on Beatport above everything else. Why everyone happily shares their charts, or worse, their 30% discounts. While Beatport already takes at least 50% of a track sale, these discounts don’t come from their share, they are reduced from the total price of a track and everyone receives less. Can you opt out for these discounts as a label? No, unless you leave the platform. Is there any uproar about Beatport running these discounts for several times a year? Never. That is exactly the reason why Beatport can just push stuff through without any form of consultation. They know electronic music artists want to be on Beatport. They know that a label has no choice but to be on Beatport, otherwise they wouldn’t sign many artists.
But be aware, as a label owner, as an artist, as a DJ or listener/music fan, that this will lead to the death of many small labels in the future because running one becomes more and more unsustainable every month. Also, be aware that these small labels often formed the springboard to success for artists. Were inventive and creative and helped music to evolve. Often are the labels that pick up artists who have been declined over and over by big labels, to bring back their motivation and joy in making music. The time is now to ask questions, to ask for change.
That’s why I close off with a few suggestions for Beatport as well.
1.) If you really like to support small labels, make Beatport Hype free to use. Or at least use tiers, for example, a label selling less than $5000 a year receives a free Hype subscription.
2.) Instruct curators to not just pick the obvious artists and labels. Make sure that more small artists and labels are featured regularly. (Exclude sublabels of bigger labels from New Hype picks.)
3.) Lower the cut you take from sales for Beatport Hype labels. (For example 25% instead of 50+%).
4.) Pay discounts from just the Beatport cut, don’t account for this towards labels and artists.
5.) Count preview streams towards paid Beatport Link streams as well.
6.) Reward Hype labels with a higher share towards Beatport Link payouts.
7.) make sure Beatport Link streams from subscribers directly reward the artists and labels which they stream.
8.) Despite you are allowed (according to the T&C) do not lower prices for everyone, give labels a choice on what price they’d like to ask for their music.
Share your thoughts in the comments and let me know if you view it from the perspective of a label, artist, DJ or listener!
* https://www.billboard.com/pro/sfx-emerges-bankruptcy-new-name-livestyle-new-leader-randy-phillips/
**https://support.beatport.com/hc/en-us/articles/215996708-Terms-and-Conditions
***https://labels.beatport.com/hype
****https://www.beatportal.com/news/beatport-new-mobile-app-for-djs-and-refreshed-brand-design/
