iGroove Blog — Know-how for musicians
Know-how for musicians  

How many artists actually make bank on Spotify?

How many artists actually make bank on Spotify? We’ve calculated the answer for you based on the most recent numbers.

March 3, 2021

Based on the newest numbers there are 60,000 songs being uploaded to Spotify every day. That’s almost 22 million tracks per year. A study has shown that of these, 1.2 million songs were released through major labels. DIY artists released 9.5 million tracks, meaning eight times as many. The remaining 11 million songs are covered by independent labels. But most of these songs drown in the flood of new music – because only a fraction of artists actually make bank.

57,000 artists account for 90% of streams

According to Spotify, there are 8 million artists on the platform who released a total of 1.8 million albums (including singles, they make up the aforementioned 22 million tracks). But out of these 8 million artists, only 57,000 are responsible for 90% of all streams on Spotify. That may sound like a small number, but it’s four times as many as it was six years ago. Spotify projects this number to go up to around 100,000 by 2023.

800 artists receive 20% of the total revenue

As of the status quo, it’s 0.7% of artists who rake in 90% of the revenues. At their “Stream On” event in 2020, Spotify announced that they paid out more than $5 billion. 4.5 billion therefore went to only 57,000 artists (or rather, their labels), which on average equals $79,000 per artist. But even among this this 0.7% elite there are massive differences: 800 artists received $1 million or more and 7,500 artists made over $100,000.

So, even in the top elite there are around 49,000 artists who made less than $100,000 per year, while only 0.1% of all artists made six figures. At the same time, a total of 800 artists received around 20% of the total payout.

The numbers emphasize why more and more artists are demanding a change in the way revenues are distributed. What such a system change can look like will be regularly covered in our iGroove magazine.

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COVID: Mental health of musicians is taking a toll

March 31, 2021

Musicians have been hit hard by the pandemic, and not just financially, but also in matters pertaining to mental health. On top of the lack of income, there is also a loss of perspective and a huge feeling of insecurity which lie heavily on the mind. According to a British study, 87% of respondents reported a decline of their mental health over the course of the pandemic.

Lack of perspective and financial worries

91% think the reason for this is the current and continuing uncertainty surrounding their music careers. 96% wonder how they can keep making a living in the future, 70% of those don’t even know how to financially survive the next 6 months, and 24% are considering a career change. This research is consistent with a survey conducted among musicians in Berlin, of which a third responded that they will have to find a different job or have already done so.

Considering that the business is generally very competitive, mental health problems have always been prevalent among musicians. Now, corona has only made it worse. A similar study has already shown in 2016 that 71% of musicians suffer from anxiety or panic attacks, while 68% have or had depression.

How to deal with the situation

Here are some suggestions that might help you cope with the situation:

  • Talk about it – whether with friends, with other musicians, or with a professional. That way, you might also gain some different perspectives.
  • You are not alone – if nothing else, this study has demonstrated that many others are fighting the same problems.
  • Maintain your routine or develop a new one. Make sure your daily schedule includes different activities.
  • Pay attention to your physical health: Go outside, exercise, get enough sleep but not too much, try to eat healthy, and don’t overdo it with the alcohol. Listen to what your body is telling you!
  • Make plans. It certainly won’t be easy, but try to draft up and take on new projects. Set realistic goals for yourself.
  • Remind yourself that things will go back to normal in the foreseeable future. You are still a musician and soon enough you will be able to show that on stage, as well.
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Why more and more artists are taking the independent route

March 29, 2021

More and more artists are celebrating major successes without major labels, and many are now seen leaving big record companies. We’ll show you what advantages come with being an independent artist.

Major labels are still a big force, no question about it. Last year, the music industry made a profit of 23.1 billion dollars worldwide, 65.5% percent of which went to major labels. However, this share has been steadily declining; back in 2019, it was 66.5%. A similar situation can be observed at Spotify, where the portion of stream revenues that went to major labels dropped from 70.3% to 68.9% between 2019 and 2020. And yet, major labels continue to enjoy an abundance of power and, above all, financial resources.

Indie instead of major

Nevertheless, more and more artists are either staying on the independent route or leaving the major labels. We’re not just talking about smaller artists either, but also an increasing number of those that any major label would jump at the opportunity to sign. What drives established artists to leave the cemented structures and financial resources of major labels to work with a distributor instead?

  • Rights to the music: When working with a major label, you have to give up the rights to your music for a certain (or even undetermined) period of time. However, when you’re with a distributor, you maintain those rights in your own hands.
  • Flexibility: You’re usually tied to a major label over multiple years or releases. But when you make a release via an independent distributor, you can switch anytime.
  • Cuts: Depending on the distributor, you only have to hand over a small percentage of your revenues or pay a fixed amount per release.
  • Of course, you won’t get the same services as you would from a major label. But you can decide for yourself how much, for instance, you want to spend on promotion, marketing, etc. As an artist, you can put together the types of services yourself and don’t have to resort to the full package that the major labels offer.
  • Transparency: With most distributors, you have a detailed inside look into the numbers and trends. This way, you gain a better overview of your finances and can plan more confidently.
  • Regular payments: While some major labels only pay their artists every couple of months, independent distributors normally credit the amount in question to your account every month.
  • Last but not least, you have full artistic freedom. Unlike with a major label, nobody will be butting into your creative process when you’re working with a distributor.

At iGroove, you have the additional benefit of being able to request an advance payment, just like you can at a major label – but again, without being forced to make a long-term commitment.

Additionally, you can request advances for older releases, for which major labels often apply a flatrate that is much too low a compensation. Furthermore, at iGroove you can get a reliable projection of your future revenues. This gives you the ability to plan your next steps and make better business decisions as an artist.

Conclusion

Many young musicians dream of a major deal. But more and more established artists who are already surrounded by a good team have realized that without a major label, they will not only become more independent but can also increase their revenues. There seems to be no better time than now to remain independent. If you have an offer on the table from a major company, you should definitely check first whether you can’t get a better deal elsewhere.

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Why do artists fall for fake music promotions?

March 26, 2021

It is commonly known that there are a multitude of untrustworthy offers circulating in the music market. So why do so many artists still fall for them anyway? It’s a mixture between a lack of knowledge, the belief in shortcuts, and scammers’ slick exploitation of the artist’s pressure points.

The streaming era has ushered in entirely new possibilities for fraud. In many other posts we have already reported on why fake streams are damaging more than anything and how you can spot suspicious offers and playlists. But why do artists, whether unknowingly or on purpose, still make use of these music promotion offers?

Know your business

A musician’s budget is already small enough as it is, so you shouldn’t invest it in fraudulent offers. Nonetheless, many people still do, and there are many reasons why. For one, a lot of musicians don’t do enough research into the workings of the music industry. Additionally, many believe in shortcuts and in buying your way to success. Last, but certainly not least, scammers know exactly what worries and concerns artists have and exploit them mercilessly.

Nowadays, it is very easy to release music and thus have some sort of music career. But it takes more than that, namely a certain level of knowledge about what goes on in the music business (spreading this knowledge is the goal of our magazine). If you aren’t interested in acquiring this information yourself, invite someone into your team who is either willing to do it or is already bringing sufficient knowledge with them.

Shortcuts lead to a dead end

As an artist, you want as big of a reach as possible and a solid fanbase – preferably now. But a music career is a marathon, not a sprint. There are hardly any artists who became stars completely out of nowhere. Just because you’ve never heard of an artist before, that doesn’t mean that they haven’t worked for years to get to this point. Patience is not only a virtue but a must. There are so few shortcuts in the music industry that don’t lead you down a dead-end road.

Scammers know your pressure points

At the beginning, many musicians simply don’t have that many streams and listeners. The scammers know this and claim to have the end-all solution to the problem, all the while keeping only their own profit in mind. It’s how they get musicians to accept offers that they should know from the beginning not to be legitimate. Most of the time, these scammers unfortunately only do genuine marketing for their own business.

Conclusion

All things considered, it is clear that you should never buy a fixed number of streams or followers. It is equally impossible to buy your way into the official playlists of streaming providers – whoever says it is, is a scammer. Likewise, you should be careful when it comes to playlist placements, promotion offers on social media, or paid placements in blogs.

If you see an offer that seems almost too good to be true or extremely cheap, it should set alarm bells ringing. Before booking anything, you should take time for some thorough research. Additionally, ask the company critical questions when you see something suspicious or don’t understand the process entirely. Using some precautions, you can avoid falling for fraudulent tricks that are not sustainable and will only harm your career.

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Spotify Loud & Clear: More insights into your streams

March 25, 2021

Spotify continuously absorbs criticism from the community, which is certainly in part related to the fact that the streaming pay-outs are not always transparent. The iGroove Magazine constantly tries to look behind the scenes and provide artists with a deeper insight into their streaming revenue. Loud & Clear represents Spotify’s step in this direction, an attempt to provide more transparency.

This is how Spotify distributes revenue

For the first time Spotify breaks down their revenue streams (subscription and advertising) and how they distribute these. An estimated 1/3 stays with Spotify. The remaining 2/3 are then put into a separate pool. From this pool, 75% – 80% is returned to the rights holders (via distribution / label to the artist) and 20-25% to the songwriters (via collecting society / publisher to the artist). This is something we will cover in more detail in another article.

Why is the PPS lower at Spotify?

Spotify also commented on why the PPS (Pay per Stream) is lower than that of the competition. On the one hand, they have the opinion that their reach opens additional sources of income for artists. On the other hand, Spotify continues to grow in popularity in many markets with low prices. While this lowers the PPS, it enables revenues to be generated from markets where piracy used to dominate. As before, an additional reason is tied to their ad-based model. Most users who use Spotify for free would not pay for it, which results in lower revenues.

In addition, they tend to speak out against raising prices, as otherwise more people would again consume music illegally.

What is Spotify’s position on the user-centric model?

They also addressed the topic of User Centricity referring to the same study which iGroove already reported on. In their eyes the advantage for the artist would be minimal. They however explain that if musicians, songwriters and rights holders (e.g. labels) so wish, they would be willing to change the system. However, this is only possible if the entire industry wants this switch.

Podcast investments: Musicians should also profit

They also made a statement on why they were investing millions in podcasts rather than music. According to Spotify, musicians also benefit from these investments. Podcasts attract new subscribers who listen to music as well as podcasts. The subscription costs of these new subscribers results in direct benefits for the musicians. Podcasters are not paid per stream like musicians, but via advertising that they place in their podcasts.

Only 184,000 artists earn more than $1,000

Loud & Clear also offers a few gimmicks. You can find out how many artists have generated more than, for example, a million dollars. We recently analyzed these numbers for the iGroove magazine. An interesting fact, (e.g.), is that only 184,000 of the approx. 8 million artists on Spotify generated more than $ 1,000 last year and that with both payments combined.

There is also a tool where you can enter the streams of a song or your monthly listeners and you are then able to see where you are within the ranking list. For example, if you have 100,000 monthly listeners you are in the top 44,000. If your track has a million streams, it is one of 551,000 songs that reached this milestone.

Is this clever self-promotion? Yes. Is it informative? Likewise. Have a look at loudandclear.byspotify.com.

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What goes into an EPK?

March 25, 2021

In the first part of this post, we talked about how you can pitch your music to blogs and media outlets. In this second part, we’ll show you all the things that go into a so-called Electronic Press Kit (EPK). When you’re writing to journalists and bloggers, you should never send attachments, only links. Or better yet: one link. The goal should always be that the journalist can find everything right away and doesn’t have to ask again or look for themselves.

The EPK can be set up as part of your website (artiswebsite.com/press) or you can use many other tools like iGroove’s free PR page. But let’s get to the content:

Press release

The core of the EPK, since it talks up the music release. It includes all the information about the release, how it came about, as well as once again a few highlights of your career so far. Try to use the press release to tell a story. Especially when it comes to media outlets that don’t necessarily specialize in music, there needs to be a story that they can pick up.

The text should already have the quality of an article, not least because some lazy journalists will just copy your press release verbatim. If you don’t feel like you would be good at this, hire someone who can do it for you. Many artists write really good songs, but the same can’t necessarily be said about their press releases or bios. When someone is reading that text, they need to get the feeling they would miss out on something if they don’t give your music a listen. The text should be no longer than an A4 page and answer the 5 W and 1 H questions.

Biography

While the press release focuses on your current release, the bio talks about your background and career so far. You should limit yourself to the real highlights only and not write more than a page. If you can upload a short version, as well – even better. Tell your story, your influences, your milestones (releases, tours, festivals, awards, etc.). and include, if possible, some quotes from the media or other musicians.

What must not be missing from the EPK?

  • Press photos: Always offer multiple photos as options and make them available in different formats. Also, make sure they are print quality and don’t forget to credit the photographer.
  • Artwork: Blogs in particular often use the cover of a release in their posts. Upload this in excellent resolution, as well.
  • Incorporated videos
  • Links to important press articles
  • Contact info (e.g., for your management)
  • Links to your website and social media

But of course, we can’t forget about the music! People should be able to listen to the release, the center of your message, directly on the EPK. If it’s not publicly available yet, you can put in a private SoundCloud link, for instance. But you should always keep in mind that we want to make it as easy as possible for the journalists. If you are also writing to radio stations, don’t forget that the song needs to be downloadable.

Also add your discography and use the link site.

Keep the EPK up to date

Make sure that the EPK is always up to date and that it can thus be utilized whenever needed for the next campaign. It’s also not just great for pitches to blogs and media outlets, but can also be used to get in contact with playlist curators, DJs, or bookers.

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How do I pitch my music to blogs and media outlets?

March 25, 2021

Nowadays, most discussions about music are taking place on social media and most listeners discover new music through playlists. Nevertheless, you shouldn’t write off blogs and traditional media outlets prematurely. Curators, A&Rs, and other tastemakers continue to use blogs and media outlets to discover new artists, and there are also a lot of fans who could come in contact with your music in this way. Articles can help establish a connection with the fans, reveal more about the artist as a person, and attract more new listeners.

You should therefore never miss out on sending your new releases to bloggers and journalists. If you don’t have the budget for a PR agency or would rather take things into your own hands, there are a few things to keep in mind. What’s certain is that music journalists and bloggers receive dozens, if not hundreds, of e-mails. This means you need to stand out from the crowd – everybody hates spam, so you shouldn’t send out any either.

Putting together a media list

Before you can start, you need to know who you actually want to contact. Instead of buying a list of media contacts online, most of which won’t be a good fit, you should put together a handpicked list yourself. If you’re a rap artist, there is no point in writing to blogs specializing in electro or rock music. That’s why it’s better to get in touch with only 20 media outlets that actually fit your style, instead of wasting your (and everybody else’s) time.

Once you have your list put together, you need to find out how the outlets in question like to receive their submissions. Some list their e-mail address, others upload a form or use external platforms. Make sure to actually follow these submission guidelines!

When is the right time for a pitch?

Journalists like to have information in advance. So, it’s best to send them your pitch before the release. Keep deadlines in mind: Bloggers are flexible, but print journalists (especially if their publications only appear weekly or once a month) obviously less so.

Personalize your pitch

Now it’s time to send those e-mails. First rule: Send out a personalized message! That’s more work, but you’ll stand out from the crowd and you’re showing the journalist that you are genuinely interested in their project. Include something that lets the recipient know immediately that you’ve really researched their medium. If you don’t have enough time, pick 10-20 of the most important media outlets and spend time crafting personalized messages for them, while the rest can receive a more general e-mail. Should you not receive an answer (chances are high that you won’t), ask for constructive feedback, but don’t send more than one reminder.

Get to the point!

What’s really important is that the e-mail clearly states from the start what exactly it is that you want from the journalist/blogger. Would they be posting a track, are we talking about a video, do you want to get into a playlist or a certain column or are you asking for an interview? Are you perhaps even interested in having the blog launch the premiere of your song/video? Of course, you shouldn’t suggest a premiere to everyone in your e-mailing list – only those media outlets that you really want to be featured in.

The first thing the journalist sees is obviously the subject line. So, take time to come up with an eye-catching headline (mentioning your stage name and genre would not be amiss). The content of the e-mail should be kept short. Briefly introduce yourself and your release, mention important information like the release date, features, and a selection of past highlights. Also add a picture to the text. Everything else belongs in the EPK. You’ll find out what all is included there here.

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Your social media content strategy

March 25, 2021

As a musician, music is often the only thing on your mind. Consequently, the focus of your social media posts will be your music also – especially since you’re using those platforms to reach more potential listeners. But precisely for this reason that we utilize social media as a marketing tool, it might be good to follow some marketing principles, as well. One of them is not to fixate on just one topic.

Define topics and strategy

This means that you must have a clear definition of your brand, which is who you are as an artist. In many areas, social media requires a strategy and a clear position. The fans should be able to identify themselves with you and this usually happens beyond the scope of just music. That’s why you should consider how you want to present yourself as an artist to the public and think about some topics that could be of interest to both you and your fans 

If you’re only ever talking about your music and are thus essentially always trying to sell your product, it gives off a very one-dimensional and self-centered impression. People aren’t just interested in your music but also in the person behind it and why you are making this music. But, of course, you also shouldn’t just ramble on about a bunch of random topics. If you’re talking about music one day, and the next day you’re discussing the military coup in Myanmar, and the day after that the subject is cars, it will seem like you don’t have a concept.

3-5 topics for your strategy

Experts recommend choosing 3-5 topics. The obvious one is music-related themes, such as new releases, music videos, and behind-the-scenes material, as well as the promotion of merch, concerts or livestreams. On top of that, you should consider 2 or 3 additional topics that you are knowledgeable in, that you have passion for, and that you want to speak about in public.

One person might be comfortable sharing their private life, the other is involved in local politics, and the third loves to talk about soccer or their pet. Of course, this doesn’t mean that you have to keep discussing the same topics year after year. On the contrary, every once in a while, you should re-evaluate whether these are still the right ones for you. After all, everybody’s interests will always evolve, so you should keep re-inventing your content accordingly.

The focus changes continuously

Likewise, you’ll need to constantly reorganize your prioritization. When there’s a new release coming up, you’ll naturally post more about the music. When there isn’t, other topics can come to the fore. If possible, you might also want to slightly shift the thematic focus depending on the platform.

Knowing the core topics also helps you develop concrete marketing strategies for an upcoming release and identify which resources you’ll need to promote it.

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The most accurate sales trends in the music industry

March 18, 2021

Sales trends give you a preview of the amount being credited to account in your future. iGroove has updated this feature and can now offer the most accurate trend data to tell you well in advance exactly how much money you will receive and when it will be at your disposal.

Many distributors provide artists with so-called sales trends. These trends give an overview on streams and sales before accounts are balanced with the streaming services. They offer artists a point of reference on where they stand approximately. The reason why nonetheless the actual payout might deviate from these numbers is that while streaming services disclose to distributors the number of streams, the type of subscription, and where the streams come from, they do not specify the monetary amount.

Essentially, all distributors (including iGroove) calculate the amount of money garnered from a stream based on previous numbers. But this didn’t cut it for us – we wanted to offer our artists the most accurate trends in the game. Thanks to our Artificial Intelligence “Muse,” we can already predict future revenues with precision, so we decided to use it for the trends, as well. Thus, we can now tell exactly how much Spotify pays, for instance, for a stream from Brazil that was generated by a family subscription.

What has changed for you?

Precision has improved greatly once again, so you can know much more accurately today what you will earn in the future. When it comes to the most important services like Spotify, Apple Music, or Deezer, the precision is more than 98%. Unfortunately, some other services like Amazon, for example, do not yet provide trend data about their streams. But as soon as they are available, we will include them, as well. Our goal is to tell you in advance exactly how much money you will receive and when it will be at your disposal.

Preview & Forecasts

The new iGroove app also shows you how high your future payouts will be. That way you know at all times how much will be credited to your bank account in the coming months and can plan better for the future. The app also gives you a projection of your revenues in the next 6, 12, and even 24 months.

If you still have questions about the sales trends, the app or the forecasts of your future revenues, feel free to contact our support.

All further information can be found on www.igroovemusic.com.

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Make the most out of your YouTube channel

March 15, 2021

Videos are one of the most important tools for marketing music, be it on TikTok, Instagram, or Triller. But the top dog of video platforms is still, by far, YouTube, with its 2 billion users logging on every month (not even counting those without a Google account).

In another one of our posts, we explained why you shouldn’t put all your eggs in YouTube’s basket. Nevertheless, a strong presence on the world’s biggest video platform is absolutely indispensable.

Clean up your YouTube channel

To start off, you might want to do some spring cleaning: As an artist you should set up an Official Artist Channel so that all your content is in one spot. We already discussed this feature in another post. Once you have your OAC, you should optimize your profile. That’s your calling card, which should leave a good impression on any visitor, so that they’ll want to linger on.

Make the following customizations:

  • Pick a name for your channel
  • Upload your profile picture and banner
  • Fill out the basic info
  • Put in the links to your website, social media accounts, etc.
  • Add the links to the channels/accounts for your other projects, your label, etc.
  • Sort your videos into different sections, to which you can add videos, playlists, or videos from other users, too
  • Adjust the URL of your channel

When uploading a video, there are a few things to consider, as well:

  • Pick a nice thumbnail
  • Write a good description, so that it’s easier for people to find the video, and include all the important information and links
  • Add cards which take viewers to another video or to your channel
  • Add your channel logo as a watermark so viewers can go to your channel and subscribe to it
  • Add an intro which you can use as a personal trademark on multiple videos
  • Add an end card with a call to action (this can be used for multiple videos, as well)
  • Upload the video in HD (720p or 1080p) for a professional look
  • Don’t forget to use tags and list the right keywords
  • Put your video in a playlist so that viewers can immediately be directed to other videos

Am I a youtuber?

First, we must differentiate between artists who use YouTube and upload their videos there and youtubers. The latter upload not just once every 1-2 months, but often multiple times a week. How frequently you want to post is, of course, completely up to you. What’s certain is that YouTube’s algorithm favors channels with lots of uploads when it comes to recommendations as well as monetization. But how can I manage to regularly upload content?

You can use YouTube as a storage medium for your videos, or you can view it as a social media platform, which means that you regularly upload new content. But what should that content be when you can’t exactly produce a new music video every week? We’ve come up with a few options:

  • Videos from live concerts (past recordings, for the time being)
  • Lyric videos (popular and definitely cheaper than a music video)
  • Vlogs: Use them to give a glimpse behind the scenes
  • Q&A: Go live and answer questions from fans
  • Virtual concerts: An obvious way to use YouTube
  • Cover songs
  • Advertisements: Present your new merch and tell people about your upcoming album, deluxe edition, or box set
  • Tutorials: A great opportunity, especially for producers, to show people the newest available tools
  • UGC: Put up videos made by your fans (user generated content) on your channel, as well

For some of these videos, other platforms might arguably be more suitable – it mainly depends on where you have the biggest community of fans.

How does YouTube’s algorithm work?

Obviously, a behind-the-scenes video won’t generate as many clicks as an elaborate music video. But do videos with fewer views have a negative impact on the algorithm? According to YouTube, that is not the case, since every video is assessed individually. The goal is to recommend videos that users want to see. Otherwise, it wouldn’t be possible for a video to go viral when the previous clips from the channel only had a few views.

The algorithm pays attention to how users react to a video. The more people interact positively with a video, the more that video will be recommended to others. Frequent uploads are rewarded, although you should keep in mind that subscribers only get a maximum of three notifications from the same channel per day. So, it’s not recommended to post more than three times daily. It also has a positive influence on the algorithm when users are taken to YouTube from other platforms. But what’s most important is the user engagement on YouTube itself.

Like any other social media platform, it’s well worth studying YouTube’s Analytics, as well, and learn more about user behaviour. That way, you can find out how users come across your videos and get information on the age and gender of your viewers.

You shouldn’t just measure success based on views. What’s also important is how many people watched the video until the end. A sustainable channel is marked primarily through a steady growth of subscribers.

Monetize your videos

Thanks to the Content ID, you can monetize not only your own videos but all videos that use your music. Many distributors, including iGroove, offer monetization via Content ID.

Another source of revenue are Art Tracks, which are available on YouTube when you submit your music to YouTube Music.

Want to increase your views? iGroove offers efficient pre-roll ads for your videos.

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