Blog Post #4
For most of my blog posts so far, I’ve been reading about the negatives of Spotify and how it is a company that is supposedly not beneficial to artists. However, after reading about the situation from Spotify’s perspective, I may have had a slight change of heart.
Daniel Ek, before starting the company Spotify, had briefly been the C.E.O. of uTorrent, which made money in part by monetizing pirated music and movies on BitTorrent, a major file-sharing protocol. Later, the Napster co-founder Sean Parker, for years Public Enemy #1 to record-company executives, joined forces with Ek. Daniel wanted to create something that worked instantly. Streaming, whether audio or video, tends to have built-in delays while you wait for the file to download, so Ek wanted the music to start in two hundred milliseconds or less. Clearly, he as well as the help with others, succeeded and Spotify now has well over 50 million paying subscribers.
From Taylor Swift’s perspective, streaming is not much different from piracy and in 2014 she removed all her music from Spotify, she further explained “Piracy, file sharing and streaming have shrunk the numbers of paid album sales drastically, and every artist has handled this blow differently.” David McMillin, an independent musician believes Spotify is saving the industry. He explained how his bands pays a flat fee of $49.99 per album per year to have Tunecore, a digital distributor, push out their material to Spotify and 23 other digital download and streaming stores. Tunecore receives $0 from the streams and every cent goes back to the band. By being an independent artist, David and his band do not have to worry about having a major label take a majority of the share. He further described, that people need to stop pointing the finger at Spotify but rather at their record labels, the labels are the ones negotiating the contracts with Spotify. The labels are the ones who determine how much the artist will receive after distributions, so Spotify is not the one to blame. In order to prevent the labels from taking all the profits David believes that bands should take extra efforts to understand the terms of their deals and work to negotiate and keep higher portions of their streaming revenues. David also admired Spotify’s integration with Songkick to automatically display upcoming nearby tour dates. Bands invest plenty of money in Facebook advertisements and banner ads to promote shows and sell tickets. However, with Spotify the artist does not need to pay for the advertisements and these free reminders of when and where to see groups and artists perform are crucial factors for success. As a Spotify user myself, after discovering new music, I immediately check if the artist has a show coming up in my area so this feature on Spotify has proved to be extremely helpful. Instead of having to search up the artist on a different platform then from there click to see their tour dates, Spotify provides this feature with one click.
After reading more about Spotify, it was definitely an eye opener. After doing so much previous research about why Spotify is not beneficial to artists, in actuality it is doing the complete opposite. Although, I still need to complete further research, at this moment I believe Spotify isn’t the one to blame but the major record label companies. After all, Spotify has paid out more than two billion dollars to the record labels, publishers, distributors, and artists who own the rights to the songs. How the labels decide to distribute the payments out to their artists isn’t transparent, because, while Spotify gives detailed data to the labels, the labels ultimately decide how to share that information with their artists.