Artists Spotify

Artists vs. Spotify: CEO Encourages More Music from Artists

Spotify has been in the spotlight continually this month. From employees trying to get complete editorial control over podcasts to CEO’s angering artists, there has been quite some backlash toward the company as a whole. Is said backlash justified? You decide.

Daniel Ek, co-founder and CEO the music streaming service Spotify, stirred up the discussion of changing the pay formula for artists. He gave an interview with the website Music Ally, discussing the impact COVID-19 has had on the music industry. With a large portion of incomes coming from live touring and shows, there has obviously been a decrease in the money being brought in, especially for artists themselves. 

Because of this lack of revenue, artists have had to turn almost entirely to streaming services to profit off their music.

Ek states in his interview, “I feel, really, that the ones that aren’t doing well in streaming are predominantly people who want to release music the way it used to be released.” He goes on to say, “You can’t record music once every three to four years and think that’s going to be enough.”

Professor of music and theatre arts Professor Mike Flannery said about Daniel Ek’s comment, “A quote like that is very revealing about how music is viewed by the companies that profit from it. What Ek is saying here is that it’s not the fault of the streaming royalties that Spotify doles out (.0035 cents per stream on average) to its artists that keeps them from making a living with their music, it’s that they’re not churning out enough material to constantly engage their fans in the current music marketplace. In other words, ‘It’s not me, it’s you.’”

Flannery continued, “It feels like an insult to the care, work, and money that indie artists put into the creation of their music and also feels very out of touch from the way that I’ve seen users interact with the music that I’ve personally made available on the service.”

Like Flannery said, this comment angered a lot of artists who feel they are putting in the work and just not seeing results. Artists are now questioning how much Spotify pays artists.

Spotify doesn’t pay artists per stream. Instead, the company takes all the money earned from subscriptions and advertising and puts it into one pie. It uses some formula to divide that pie up between artists. Those who get the most streams earn more money. 

Popular artists including Adele, Prince, Taylor Swift, Coldplay, and more are staunchly against the streaming service. Prince famously said, “No musician got rich off digital sales.” interviewed Tim Ingham, founder of Music Business Worldwide, a global music industry analysis site and David Macias, president of Thirty Tigers, a company that provides music marketing, distribution, and management services to independent artists.

While discussing the comments made by Ek, the topic of redistribution of money came up. Macias offered a possible solution: “Perhaps splitting up the pie where our $10/month goes proportionately out to the artists that we’ve listened to might help even the playing field.”

Similar to waiters and waitresses pooling tips, it doesn’t seem fair that the money being made off an individual’s music isn’t going directly to that individual. 

Flannery relates to artists who are struggling to live off the money made from streaming, stating, “Consider my highest streaming song, ‘Tuck Me In.’ It’s a kid’s song off of my album Love Songs For Silly Things that has about 130,000 streams (that’s about $450 of revenue split up over a few years) now, for some reason, even though that song gets played a lot, our next most popular song has 11,000 streams ($38.50 in Spotify money) and it isn’t even on the same album as ‘Tuck Me In.”

130,000 streams, and the payout Flannery received is $450. That is $0.00346/stream. It would take about 300 streams of ‘Tuck Me in’ to equal $1. However, that money is split between all the personnel who own rights to the music, the producers, and after Spotify takes its cut.

Not only are streaming services important in a world of technology, but seeming as though we may be stuck with COVID-19 for a while, it is crucial that artists can find some sort of income from their music.

Daniel Ek may be right that only putting out music out every couple of years isn’t going to do the trick, however, the debate over how much artists make from services like Spotify is a continuing conversation.

Flannery’s advice for songwriters: “Focus on making great content that people fall in love with and want to listen to over and over again with song titles that come up often in common searches.”