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this post was submitted on 23 Nov 2023
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Well that's damning
Spotify currently pays out at 70%. Doubling royalties would cause them to pay out more than they make in subscription and ad revenue. This is why they're shutting down.
70% of what?
If that's subscription revenue in Uruguay then the business model is just not feasible, unless they up the subscription fees to adequately cover costs.
This is the risk when the revenue model doesn't scale with th cost model.
70% per dollar apparently. It's mostly large record labels taking the lion share though I think, independent artists make pennies.
95% of the royalty pool goes to 200000 artists who generate 15% of the content. Sounding less fair the more you look at it.
Depends doesn’t it? If I make a song that is listened to zero times, I wouldn’t expect to get a payout that equals Spotify subscriber income split by amount of songs. Disregarding the popularity.
The entertainment business, is a one-to-many business and money follows whomever sits at the top of the pyramid. And it was the exactly the same before the streaming era.
If you make a great song, and Dua Lipa makes a crap song, which one would be featured and added into playlists by Spotify's algorithms? It's not a level playing field. It doesn't promote content that isn't already popular.
I'm sure that songs that tend to become popular are probably promoted first. And I think we agree that you can always do more work to showcase lesser known artists.
But with that said, it has never been easier to get your music published. And any idiot can make their music globally available. Which is a win for smaller artists.
And the songs that Spotify put in my Discover Weekly list, often has less than 10.000 plays. So in that regard their algorithm work in the unknown artists favour.
Ease of publishing - ignoring the fact that it’s been easy to record and publish since well before Spotify came along - just means more volume of content to sift through for audiences, meaning that lesser known artists end up having a hard time just like they did before, it’s just that now it’s for different reasons. Regardless the result is the same: bigger artists get an advantage on being discovered. At best it’s still the same playing field it was before.
Spotify did not democratize the ability for working musicians to earn money any more than broadcast radio did. Another medium that favored and continues to favor already established artists.
You mention your discover weekly. Do you know how that algorithm works? It suggests songs that you have not played, that other people who played songs that you played. It's the same positive feedback loop. It's songs already popular that it promotes to be played more. Which makes them more popular so it recommends them more. And thus you end up with the most steamed artists only making 15% of the content.
Does it work? Passably. For the majority, mostly generic listeners. Is it a fair way to structure a platform and to dispense payments? No. A great business model however.
On a platform like Spotify I don't really see the issue here.
Have you ever looked through the other 85% of the content? Excluding finding some obscure hits, most of it is trash.
Unless we want to argue that any art in our current economical system should be of equal value no matter what.
But it's based almost entirely on actually streams. So they only get the majority of royalties because they get the majority of streams.
Which is mostly due to Spotify's playlist and algorithms. Which fall victim to the positive feedback loop issue. Those popular artists are suggested, promoted, and played more frequently so more people hear them and thus play them more. It's not a level playing ground. It's a self generating walled garden of artists.
There's too much music out there...
they don’t. spotify says they’re paying 70%, but they don’t tell how they redistribute that revenue. they have under-the-table deals with the 3 majors who grabs most of that money, and leave the crumbs to everybody else.
Doubling means rising the price and not shutting down or giving less to some and more to others. The new price may be too expensive for the customer. In this case, the service or the business model is the issue.
An other regulation may be to pay egally all artists per listen with this point regulated as well.
Spotify didn't turn a profit yet. I would be pessimistic on the business model knowing the Majors take the majority of the 70%. Spotify is de facto a monopoly and so the Majors. With a fair price, the issue is to see the Majors quit the service and launch their own service. Spotify would be useless with only the indep (this is sad). They are protecting their money and the Majors. They don't care about the smaller artists.
Spotify is hardly a monopoly by any standards. I agree that they have a large market share and in some countries Spotify is synonymous with music. But there's plenty of options