Spotify and FC Barcelona announced a branding deal worth circa $310 million last week, which will see the Spotify logo branded on football jerseys, memorabilia and even on Camp Nou (FC Barcelona) stadium.
This follows their investment and hosting of Joe Rogan’s controversial podcast that platforms COVID-19 misinformation and extreme views, of around $300m that sparked a rebuke from Neil Young that triggered a #Spotifyexodus by users and musicians last month. In addition to a 100 million euro investment into shady defence firm Helsig by Daniel Ek. The company plans to use artificial intelligence to support militaries in battlefield assessment operations, reports Mixmag. Which goes against the feelings of many of its users and artists’ wishes.
It’s the latest in a long line of pronouncements and actions that prove Spotify doesn’t care about music or musicians, that they would rather fund already wealthy sportsmen and a football team and corporate interests, than pay musicians fairly for their work (or invest in the crumbling infrastructure of venues and independent labels that support them), upon the backs of whom they built their business model! It’s a cruel irony for many musicians that these investments aren’t just tone-deaf but lead to one conclusion – that they only care about what keeps users on their platform. If it was 1,000 cats meowing that did, they would invest in that. They don’t care about nurturing the future of music but their own bottom line of profit, they only care about Spotify.
Spotify claims it will use its new sponsorship of Barca as an opportunity to “amplify the work of artists” in a way that brings “the worlds of music and football together, giving a global stage to players and artists” at Spotify Camp Nou, Alex Norström, Spotify’s chief freemium business officer, said in a statement. But what that means beyond some banners for major artists on Wall Street or advertising at the Nou Camp, we shall see.
Super producer and one half of Audiobooks David Wrench, points out there appears to be “plenty of money floating around at Spotify. Enough to sponsor football teams and invest in weapons manufacturers…. But still not enough to pay anywhere near a fair rate to musicians.”
The Music Venue Trust argue that “For the amount of money Spotify have agreed to spend on branding FC Barcelona they could, instead, have secured a permanent future for circa 700 UK Grassroots Music Venues by investing in the bricks and mortar of the sector.
Such an investment could have unleashed £40 million per annum into grassroots artist talent development, from which Spotify, Universal Music Group, Sony Music Entertainment, Warner Music and others are the ultimate financial beneficiaries. Not only that, but an investment of money in this way would generate a reasonable financial return, being invested into bricks and mortar and therefore remaining an asset.
Literally, instead of throwing money at football shirts, Spotify could have taken that money, invested it into music, kept the value of that money, improved the economics for every new and emerging artist, and by making a small and reasonable return on a sensible and protected investment which completely aligns with the best interests of their company. If you are a Spotify investor, or you work at the company, it’s probably worth asking why this temporary branding opportunity has been selected in preference to a long term structured investment in music with an assessable impact.”
This news will only further inflame the Spotify exodus movement that has taken in the Broken Record campaign for a fair and equitable streaming remuneration in the UK – ie that what you stream receives a fair royalty rate. Last year a bill of reforms proposed by MP Kevin Brennan calling for a “complete reset” proposing that artists should split profits equally with labels instead of receiving 16% for streaming. Against the backdrop of COVID-19, the closure of the live touring industry for much of the last two years, crippling the ability of artists to make ends meet, this issue was thrown into sharper contrast leading many musicians, crew and associated professionals to quit the industry or unable to pay their bills.
Catherine Davies, aka The Anchoress, told the BBC last year that she has made nothing from 750,000 streams: “If streaming numbers had been recording sales, I would have got a gold record on my wall for The Art of Losing,”
“But I’ve earned nothing, not a penny, because of the structure of my label deal. There was a small advance but it didn’t cover the cost of mixing.”
During a DMCS inquiry into streaming last year Nadine Shah admitted she had struggled to pay her rent while other contributors argued that streaming rates would only lead to more wealth at the top for major artists and labels, not an investment in a thriving and diverse music scene. Tom Gray commented at the time of the initial publication of the streaming report that “The report brilliantly and coherently cuts to the chase: the music industry has a serious problem. Profits are soaring, margins are better than ever, the value of the once piracy-blighted industry is forecast to eclipse anything seen in our lifetimes within a decade, but performers and songwriters are being left well behind.”
“As we’ve repeated, rather like a broken record, it’s a failing market where corporations have little incentive to share their extraordinary profits with the architects of their success, musicians.”
After his bill initially failed Brennan commented at the end of last year that “Equitable remuneration for performers is already in effect, or currently being implemented, in territories across Europe, while British creators continue to struggle financially. I will continue to push for legislative solutions to make sure that music makers in the UK receive a fairer share of streaming revenues, helping to make the UK the best place in the world to be a musician. I believe that reform is coming even if we may have to wait a little longer than hoped.”
Like a dam that’s been ready to break for many years, a backlash has been a long time coming. CEO of Spotify Daniel Ek has been tone-deaf and increasingly shows a flagrant disregard for artists and music upon which his business has been built. They’ve taken a share hit as users and musicians like Belly abandoned the platform in favour of more ethical alternatives like Tidal, Bandcamp, Soundcloud and others. This wasn’t a surprise, many artists have been wrestling with the Catch 22 of wanting to use Spotify as a promotional platform but seeing their music being devalued by its dominance in the market as a distributor along with shrinking royalty rates. The company’s investments were the final insult for many.
The response to the Rogan affair from Spotify saw Daniel Ek publish a blog where he committed to “do more to provide more balance and access to widely-accepted information from the medical and scientific communities.”
Spotify also announced that podcasts discussing the COVID-19 virus would now come with content advisories, in a PR effort by Spotify to halt the #Spotifyexodus movement Neil Young started and make sure it won’t extend to artists that are more popular (and more important) for Spotify such as Taylor Swift, Bad Bunny or BTS.
When responding to the criticism around racist language and comments that had featured on Rogan’s podcast in the past, Ek announced a $100 million investment to support music and audio from “historically marginalised groups”. This seems like a drop in the ocean and contrasts with Spotify’s refusal to increase funding for musicians and infrastructure.
Spotify’s contentiously low payout rate has fluctuated over time. Tom Gray has long argued for equitable remuneration ie the music people listen to receives a share of the funds, not how it works now where it’s put into one pot and divvied up to the biggest artist. At present, Spotify is believed to pay between £0.002 and £0.0038 per stream, while Apple Music pays about £0.0059 and YouTube around £0.00052. Not all streams pay the same – Spotify Premium listeners pay more per stream than the free tier listeners. The pay-per-stream system also varies based on what country a listener is from.
“Spotify keeps 30% of all revenues generated. Of the remaining 70%, a part is paid for the songwriters and composers and the rest goes via label or distribution to the rights holders of the song.
From the remaining share, it’s calculated how many streams there were in total and how high the share of each artist is. Assuming there were one million streams per month and you have achieved 1,000 streams, you will receive 0.01%,” iGroove explains.
As if to add to the swirling anger around royalties and the investments Spotify have made in recent times, Spotify are also currently in court trying to reduce the pitiful amount it pays to rights holders in the US. The Copyright Royalty Board is currently considering what those rates should be for the next five years, while Spotify and many of the other streaming services are still appealing the rates that the CRB set last time.
“Spotify et al are currently pushing for a 10.5% revenue share commitment to songwriters and publishers in the US, even though the CRB previously increased it to the 15% commitment that is already common elsewhere in the world. Of course, with the music publishers now advocating for 20%, Spotify may be going in at 10.5% in the hope that the outcome is 15%.”
“It’s harder for Spotfiy to argue that its payments to songwriters and publishers should be reduced when it’s concurrently spending hundreds of millions on assorted projects outside of music.” Argued music news aggregator CMU.
Responding to reports of Spotify’s Barcelona deal, the boss of the US National Music Publishers Association, David Israelite, remarked: “You can’t even make this shit up”.
I spoke to some musicians and labels who have removed their work from Spotify in the last few months and years and asked them what was their own breaking point with the platform. Plus some music figures who have a view on how Spotify operates.
“Spotify is accruing enough money to invest in a company that can profit from war. Money generated by Spotify subscriptions. In addition to not paying musicians fairly, Daniel Ek is now using the money he has made out of musicians to fund a company whose sole priority is securing lucrative contracts with military agencies, whose sole occupation for the last century has been war. Helsing is a new type of security and artificial intelligence company which claims to create artificial intelligence to serve liberal democracies/governments.” argues musician Tim Arnold in a popular piece about removing his music from Spotify on Medium.
“Well that sounds like a great pitch for an AI company vying for business from national governments, but we’ve all seen Oliver Stone and Michael Moore documentaries, so we know that ‘security’ is another world for military involvement with/or in conflict with other nations who are not liberal democracies. My perception of Spotify profits funding such a company isn’t political, and no matter how progressive, democratic, and reasonable their mission statement is, is simply not the point.”
“If the love of music has generated $100 million in profit, why not use it to support an organisation like Jo Berry’s Building Bridges for Peace whose work focuses on resolving conflict before it develops into a military situation?
Why continue to facilitate the concept of military conflict as a convention? Surely funding acts of empathy and conversation should come first?”
The artist Miri explained why she started to remove her music from the platform “I started removing my solo projects off Spotify last year. Only have ‘Trends’ up which is a recent single but I’ll be taking that down soon. Daniel EK is investing in the military. Daniel EK continually shows he has no regard for artists.”
Mike Turner of label Happy Happy Birthday to Me explains his Catch 22 situation as a label: “I never wanted to be on it, but almost every band asked to be. I said at the time once you go on there your actual digital sales will drop and streaming pays nothing, everyone still wanted to be on there. Up to me, I’d not be on there, but it’s up to the bands.”
Machine Records explain why they are against the platform: “Not only being willing to spread harmful misinformation during the pandemic, putting $ over people’s lives, but also showing such total disrespect to a living legend like Neil Young. Spotify are clearly just utter wankers. Why would we want anything to do with them? Toxic.”
For other acts it’s not so simple to remove their music from the platform, Frequency reveal they are “thinking about removing my music but it’s all wrapped up in distro red tape. We need alternatives though. Bandcamp is good. Soundcloud ok. Resonate looks interesting. @gotohear is the one I’m most interested in at the moment. We need a shift back to putting value on music again.”
“I started out dutifully posting all my music to Spotify and other streaming services a few years ago via Distrokid, but then switched over to using them as more of a promotional vehicle only: I’d send one or two tracks from an album and reserve the rest on Bandcamp” explains ambient electronic artist clocolan aka Emlyn Addison.
“I knew I wasn’t making anything on streams but it seemed reasonable as a way to get the music out there and maybe pick up a few more fans. But many listeners (in fact, I’d guess most) didn’t even know that there were whole albums associated with the one or two tracks they heard there. So much for that idea…”
“Then, a few weeks ago, when I learned about Daniel Ek, Spotify’s CEO, investing 100 million in military technology, I pulled all my music. When your contributor base is comprised of a historically liberal, staunchly anti-war bloc, you have to be pretty tone-deaf to turn around and do something like that. As the CEO of the most visible music streaming service, it takes a special kind of ego to make that call while underpaying the same artists who helped enrich you.
When the latest accusations erupted about Spotify, I was happy that they were being exposed—for once again putting profits ahead of people and ethics—but equally disappointed that they were being called out for something unrelated to what I saw as their core failures: underpaying the people who make their model function, and using artist content to bait listeners and then prioritizing their own in-house content and playlists to skirt royalty fees.”
“There’s a strange phenomenon with digital goods. Once something can be digitized and downloaded, it loses any meaningful value. We accept that enjoying a cup of coffee for 30 minutes costs $5. We’ll pay another $5 for another cup. But for 30 minutes of music? We’ll pay $0,067740 for 10 tracks. We’ll pay $10 for 50 million tracks. Internet consumers, in my view, have become habituated to free or nearly-free content. For indie artists, it’s unsustainable and, frankly, unfair. Consumer apathy is a big problem (that the streaming services are only too happy not to address). Bandcamp is about the only bright light in all this (and no wonder physical media have come roaring back).
With music technology having become so ubiquitous and affordable over the last couple of decades, there was a growing population of indie music makers with music (and dreams). It didn’t take much to convince an army of MBAs, following the Napster/piracy era, to turn that into a profit opportunity. And for all those artists, it was the easiest sell in the world.
The streaming services assure us of how much they’ve paid out to artists; big numbers sound impressive. But most of the artists making real money on those platforms would have already been making money elsewhere. There are probably some exceptions, but it’s hardly a consolation. And they assured us that it would reduce if not snuff out piracy by making music “affordable”. Music piracy is alive and well; it hasn’t changed anything. Woah, that was more than 2 cents worth. That was like $0.067740 per word!”
The artist Joshua Caole wrote a blog post explaining why he is removing his solo work and working with his band ¡Que Asco! “I have always had a troublesome relationship with Spotify and indeed in the beginning it was due to my prehistoric nature of “you buy a record at a store and then go home” or to your car and listen to the whole thing in order to take in its magic. When MP3s started appearing on bands’ websites it was special and you could find tiny bands from Idaho, Wellington or Buenos Aries that you may never have heard otherwise. With the invention of Myspace and bands being able to put a few songs up to attract new fans this was all wonderful, but just like the fantastic format of MiniDisc, this had to end.”
“It took me a long time to start using Spotify and the real start for me was when I started releasing my own music and I thought what’s the harm, everyone else does it.” He explained “I started using Spotify to listen to music when all else failed, no free CDs with magazines, blogs stopped using free MP3s and everyone said if you want to check out this band go to Spotify. I hadn’t released the entire ¡Que Asco! debut album on the platform as an experiment we tried with the record label which ultimately failed. We were inundated with blogs asking where the songs were on Spotify so they could feature them on playlists which in turn led to less promotion for the album. One journalist even told me that the omission had led to some very big decisions going against us which I won’t go in to depth about.”
“My initial problem with Spotify as an artist was the incredibly low pay, When I released my first solo album I had an amazing first week both in physical and download sales yet my end of the month pay from Spotify amounted to less than a dollar. I don’t agree with this model and I will still use streaming platforms to distribute my work for the time being as who knows where the industry will end up next, people used to laugh at me for buying vinyl twenty years ago but look at it now.
Neil Young and several of my other heroes’ departures from Spotify brought new light to the issue. I had never heard of Joe Rogan till a few weeks ago and as much as I am a believer in free speech, spreading misinformation is just as reckless as keeping your raw chicken next to the cooked at KFC: Someone will get sick. The bigger issue for me was India.Arie bringing to light the issue about racial language in Rogan’s podcasts, I have no words.
So this (I’m at a loss for a better word) prick signing a multimillion-dollar with a company who can’t afford to pay artists more than $0.003 a stream is sickening. What turned my stomach even more was the £236 million deal they are about to announce with FC Barcelona including naming rights to one of the most iconic football stadiums in the world just made me cry.
The last thing that was just another kick in the balls was Daniel Ek’s investment in a weapons company, with the world on a knife-edge and having already lost close to 6 million people unexpectedly over the last two years the last thing we need is something else to take more human life from us.
So 384 million pounds later apparently musicians are still worth just $0.003 a stream.
My music will still be available online with Bandcamp, my favoured destination, if you want to buy my music digitally or physically. “
“The same goes for streaming: Tidal is a great and easy service to use and at the moment you can use services like Tune My Music to import Spotify Playlists over to Tidal and sync up with other streaming services too. “
Mark Christopher Lee of The Pocket Gods who recently released a 1000 track album with 30 seconds for each track to make a statement about the devaluation of streaming platforms told me:“1000X30 is making a statement about the value of music – how much do we as consumers value music and how much as the company’s the likes of Spotify value music – we’ve all been accustomed to getting music for free or for cheap and Spotify as market leader is part of this problem paying £9.99 to have access to the world’s popular music seems ridiculously cheap.” He points out.
He was inspired by an article in The Independent in which a New York-based music professor argued that Spotify’s idea of what constitutes a stream could mark the end of the three-minute pop song. “I saw the article and it made me think, ‘Why write longer songs when we get paid little enough for just 30 seconds?’,” Lee told i News.
One track on the album called ‘0.002’ refers to the amount of money an they receive per stream on the platform. “We wrote and recorded 1,000 songs, each a shade over 30 seconds long for the album. The longest is 36 seconds. It is designed to raise awareness about the campaign for fair royalty rates,” Lee continues. “I release my music on Spotify but I don’t have a contract with them saying they will pay me this amount per stream – there’s just a very vague and complicated formula that decides how their revenues they receive from subscriptions and advertising are divvied out to rights holders – we’re talking about fractions of fractions. I don’t think it’s possible that music could be de-valued any further until Spotify became a listed company and started diversifying into podcasts.”
“I can understand and respect why Neil Young asked for his music to be removed from Spotify, he has had issues with their sound quality and the whole listening experience and the vaccine issue was the last straw for him especially having had polio as a kid. I can’t comment on Joe Rogan and his podcast having only ever heard a snippet of it with the one about Bob Lazar who claimed he back engineered UFOs at Area 51 – but the podcast seems a bit testosterone fuelled for my tastes.” he mused
“However, I can tell you that since Spotify spent $100 million on obtaining the rights to his podcast that the pocket gods’ royalty rate has dropped from £0.007p per stream to £0.002 – which is insane and surely not right but what can we do about it? We don’t have a contract so can’t take them to court – and unlike Neil Young and more established artists whose fans will follow them to other platforms – we can’t leave as most of our fans access us that way so until Spotify pays us more money we will just release 30 second tracks – and we’re calling on established artist like Ed Sheeran, Taylor Swift, Sam Fender and Noel Gallagher to do the same and stand up for our rights – we need to be valued – not just the artists but the songwriters, the musicians the producers all of us are immensely undervalued – Music is the most amazing part of the human experience which is universal – by undervaluing it we risk losing the part of us that rises above the mundane and the functional. So rather than leave Spotify let’s fill it full of 30-second tracks – white noise, feedback, crap indie songs – let’s rebel and bring the system down!”
“Bandcamp is the one ethical platform still out there. My only issue is running a small label I need them to pay via bank transfer and not be at the mercies of the unethical place that is PayPal – but maybe there is a void to be filled, people say Tidal pays well which it does but not very often but at least their sound quality is superior. Listen I love technology and I love streaming I started my own small label to release music digitally it’s made releasing music more democratic and less at the mercy of major labels and music industry crooks but what we have now needs to evolve to the next level which as well as including the likes of Spotify also needs to include the consumer the listener the music fan.”
“Digital audio in the hands of actual music fans has always seemed a good thing to me, Napster included – especially music blogs – and now Bandcamp.” argues Damon K (Galaxie 500) on Twitter, the artist and outspoken critic of the platform adds “but digital in the hands of business/management consultant/investor types, where any and all audio is equivalent, is a disaster for music because what is music but audio overvalued by some and undervalued by others? I don’t believe a market analyst could ever really get why. We all thought it was so lame when major labels started calling our records “units” in the 90s. Little did we know.”
An article in Variety put it bluntly. Spotify’s “…assault on songwriters’ income — in concert with competing platforms YouTube, Amazon and Pandora — is mind-boggling hypocrisy: Not only is Spotify built on songs, it is fully aware that songwriters’ livelihoods have been decimated in the past two decades, and yet they’re undertaking a multimillion-dollar, years-long campaign to pay songwriters less. “We love songwriters!” they say. “Look at our songwriter’s hub with pages and playlists we’ve made for them!” Swell — try finding a songwriting credit on Spotify. It’s there, sure; just click on the song… then find the three dots on the far right and click on those… and then scroll down and click on “show credits.”
Fueled by the likes of Spotify streaming has undoubtedly shifted consumption of music in the last ten years especially, for the large the majority of all recorded music in your pocket for a mere £9.99 a month is a deal most music fans will say yes to! But this monthly fee undervalues music and creators the failure to invest in properly and value the music they make.
Netflix just raised prices to $20 to create more new content.
In 2007 I paid $14.99 a month for music streaming. It is now $9.99, down 33%, for all music ever recorded. The wrong direction.
This is not sustainable for music artists and it ends in disaster.#brokenrecord
— Alan Graham (@agraham999) March 20, 2022
Spotify might be a really useful app for listeners with handy playlists and the most music in history but its sound isn’t great and how it treats the artists we love is unacceptable. It is time to consider what Spotify funds and how it is devaluing music. Many users and musicians are leaving. What are the other options? Well Tidal has better sound, pays slightly better. Bandcamp and Patreon allows you to own and support the work of artists you love and explore and Soundcloud is shifting towards more equitable remuneration for artists, while Resonate and Sonstream offer an even more ethical platform.
However, many artists have no choice but to use Spotify for promotion or because it being a requirement of their label deals. Fans and artists have more power to change the system than they realise – if users continue leaving the platform they will be forced into reconsidering their investments and the rates they pay artists. So before you fire up that green app on your desktop remember Spotify is a corporation out for their own bottom line, they won’t safeguard music’s future. Indeed, reports have shown that the algorithm of streaming is focused more on music catalogue with 70% of listening now of music of the past. With the largest streaming artists such as Taylor Swift and Drake and their major labels being the ones making the most, there’s major inequality, with Spotify more concerned with its own profits than funding struggling artists and the infrastructure that fosters them. We can only really support the acts we love directly by buying a concert ticket, a record, or downloading, or buying their merch, through a fan-funding platform. As for streaming? Well it’s time to shift the dial and create the change we want before it’s too late!
I’ll conclude with a quote from songwriter, PRS director and #BrokenRecord Campaigner campaigner Crispin Hunt who offers: “The question of whether Spotify is beneficial to the Music Business is not in doubt, whether it’s beneficial to Music creators is another question. The system seems designed only to economically work for aggregated rights, with a couple of artists’ lottery winners as the lure. What the Joe Rogan/Neil Young issue has illustrated is that Artists still have great influence and greater principles. As Spotify and other platforms begin to realise that with great reach comes great responsibility, larger questions arise for the internet: Free Speech is a rock I’d die on, but it is also used as a complex tool of empire absolving the powerful from responsibility for profiteering from harm. Thankfully, Neil Young has demonstrated what great responsibility and great reach looks like. I do think the recent #FixStreaming #BrokenRecord debate has allowed creators to realise they shouldn’t be afraid to hold Music streaming to account.
Creators are not mere passive by-products of the Music Business, they are the Music Business. If the devaluation of Spotify share price & subscriber churn continues then certainly its power over the market will weaken. Competition in Markets is always healthy. I would hope that other platforms with a better understanding of artists’ needs may take this opportunity to improve the system so it benefits creators as much as aggregators. There are encouraging signs: Tidal with User-Centric, Apple not opposing a songwriter rate improvement at the US CRB, Soundcloud’s Fan Powered system. Neil Young and Joni Mitchell’s (and other brave acts) stance has shown others we are not all incarcerated within those platforms, Creators can help shape markets and help shape a better future for creators. Just as Musicians led positive dissent through history, I think the Musicians are becoming emboldened to continue. Hope so. The big tactical mistake Spotify and the Music Industry made with streaming was to design it so 99.8% of artists have little or nothing to lose in mutiny against the model…..there is no Bounty after all.”
