Is Spotify Damaging the Music Industry?

“Taylor Swift is absolutely right: music is art, art has real value, and artists deserve to be paid for it.” This quote comes directly from Swedish CEO Daniel Ek’s blog for Spotify—the music streaming company from which Swift recently removed all of her albums.

The pop singer cut ties with Spotify, claiming that streaming sites not only lessen album sales, but also decrease the value of an artist’s work. Swift references Beats Music and Rhapsody, two services that require users to pay a premium fee in order to access her albums, for placing a “perception of value” on her music. In an interview with Time, Swift implies that Spotify does the opposite: “On Spotify, they don’t have any settings, or any kind of qualifications for who gets what music.”

Swift’s decision to quit Spotify and release her new album “1989” on iTunes was met with record sales; 1.3 million copies sold in its first week, while the album remained at the top of Billboard charts.

“Everybody’s complaining about how music sales are shrinking, but nobody’s changing the way they’re doing things. They keep running towards streaming, which is, for the most part, what has been shrinking the numbers of paid album sales,” said Swift.

Swift’s business strategy in keeping the album off Spotify and other various streaming services encouraged anxious fans to buy the album. However, critics wonder whether this move will pay off in the long-run, as the music industry is moving quickly towards streaming platforms.

In response to Swift’s allegations that Spotify diminishes the value of music, Spotify CEO Daniel Ek stated that the company aimed to protect music artists from illegal piracy, and has already paid upwards of $2 billion to music labels and producers since 2008. Premium users pay $9.99 a month to enjoy Spotify’s vast music library without advertisements on smartphones and computers.

According to Ek, piracy is the stealing of music without compensating artists “a penny,” while Spotify pays popular artists and labels millions of dollars a year. Ek promises to “work with the industry to increase transparency, improve speed of payments, and give artists the opportunity to promote themselves and connect with fans.”

Spotify’s CEO points to Hozier’s “Take Me to Church,” a widely popular hit generating hundreds of thousands of dollars for his label and music publisher. As for Swift, based on her popularity and listening audience, he predicted payouts to exceed $6 million a year.

Sasha Frere-Jones, a writer for “The New Yorker,” debates the benefits of Spotify by questioning what the definition of music is when it is streamed rather than purchased. “What are recordings now? Are they artistic expression that musicians cannot be compensated for but will create simply out of need?”

As a fan of streaming platforms such as Spotify, 8Tracks, Soundcloud, and others—the greatest aspect I see for listeners is the variety of genres available right at our fingertips. My iTunes reflects only a fraction of the music I listen to—mostly because it is unfeasible to buy all the music I would like to. If not for streaming services, I would only purchase music from select favorite artists. Fellow music lovers share similar attitudes, and seek sites such as Spotify for the vast collection of music waiting to be discovered.

As listeners gravitate away from purchasing albums directly, the decision to restrict music from streaming services can potentially cost artists a large portion of their audience. Although Swift’s choice paid off in the short-term, and drove up album sales, her general audience for “1989” consists of loyal fans, rather than new listeners searching for music, but hesitant to spend $12.99 on an album.

Rather than boycott what seems to be the future of the music industry, the better option seems to lie in negotiating further with streaming platforms. Likewise, companies such as Spotify should cooperate with dissatisfied artists and devise methods to generate greater revenue for all artists— Billboard chart-toppers and indie artists alike— such as giving users greater incentive to go Premium.

Remodeling business tactics can improve general attitudes of listeners and music artists towards streaming while providing music fans with the endless selection of music that they crave.

 

Image Source: Philly.com, ABC News