What is the best way for Artists and Bands to make money from their music online?

There are myriad ways to sell your music online these days but often the sheer quantity of services leads to a dilution of returns on your music.

In my experience (with the label Sonic Vista), absolutely the wrong way to do it is to spread yourself far and wide, registering for every service, putting 17 widgets on your network of sites and hoping you’ll see the money roll in.

This approach not only dilutes your music but also takes time and makes real interaction with your fans very difficult. Many artists have taken this approach and we’ve seen bands maybe getting a couple of small payouts every few months, even if they reach the often substantial threshold.

So who should you trust with your music?. The following infographic shows some of the features offered by a variety of platforms.

Who gives the best deal for selling your music online

Spotify, Deezer and We7 are the ones to really think long and hard about. They have ‘ad revenue stream’ models and subscription options but artists only see a tiny, tiny fraction of any monies generated. You’ve all seen the Lady Gaga story right? If not here’s a link.

Of course you’ll probably want to get your music onto iTunes. Apple still takes a substantial commission but their payouts are more generous than the streaming services already mentioned. It is also unlikely you’ll be able to directly sell your music on the iTunes platform. For this you’ll need to go through a 3rd party aggregator such as Believe, CD Baby or ReverbNation. Believe will put your music onto itunes and other services for free but again take a hefty commission of around 30% on top of Commission charged at the point of delivery. You’ll be lucky to see more than 15-40% of the selling price. Believe also operate an exclusive system meaning you can’t use anyone but them to distribute your music. They have also been quite aggressive recently, enforcing take down orders on youtube videos, even if they have been uploaded by the artists. CD Baby and ReverbNation both charge you upfront to get your music onto itunes but could work out cheaper in the long run if you sell enough downloads. The disadvantage of selling in this way is that you can’t fix the prices or have any meaningful interaction with your fans.

Finally there are services like Aurovine, who let you set the price of your music. Fans can even pay more if they want to. They allow you to sell physical releases, gather fan info for your mailing list and also pay you around 86% commission on your sales. Aurovine is a new independent service but deserves to be supported for the extra features and fair share policy. It launches on May 11th, 2012. Register for more information here.

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