Do you think your money goes to the artists you listen to on Spotify?
Streaming services have changed the way we consume music for the foreseeable future. In some ways, this change has been positive. For example, independent artists can self-release their music and potentially breakthrough to a wider audience. However, with this change comes a greater financial burden. As the records are no longer sold, small to medium size musicians must rely purely on touring and merchandise sales to sustain themselves which, as we’ve discovered in the past year, is not particularly sustainable and also not entirely fair.
The fact that musicians earn almost nothing from streaming is not a secret. For instance, Spotify pays £0.003 per play which is then split up between different parties - producer, mix engineer, songwriter etc. To put it into perspective - an artist will earn approximately £34 for 10,000 streams.
To make a minimum wage* in the UK, the artist(s) will require roughly 377,940 streams per month. Often, this is an unattainable objective to any small to medium-sized bands.
Music-making is a full-time job which requires years of training, practice, and expertise. Essentially, musicians are the workforce making a product that is then packaged and sold by other parties. The lack of sustainable royalty payments hits non-touring musicians such as non-performing songwriters and lyricists particularly hard as they often rely on royalties.
The statistics I provided above do not exist in a vacuum but are also not unchangeable absolutes - it was decided to pay artists like this. And if that’s the case, we can change the way the profits are calculated.
Your favourite artist won’t see your money
The royalty system for Spotify at the moment is that it pays all artists from the pool of collected royalties by the % of the streams the artist gets - e.g. if Ariana Grande gets 3% of all streaming in the world, she gets 3% of the marketshare. However, it means that even if you’ve never streamed her music and you exclusively listen to underground shoegaze, some of the money you pay is likely to end up in the pockets of the mega mainstream artists.
This is a problem as some genres of music are inherently niche - such as jazz or death metal. While creators of such genres won’t top the charts, they still have a dedicated following and deserve to be fairly paid if we want a diverse musical landscape. Streaming services just have to aid it and distribute the profits appropriately. The current system disproportionally harms niche artists and genres, and it risks reducing the modern commercial music to a distilled radio-friendly output as musicians attempt to survive economically.
"I used to pay some bills with my CD income or download sales, but now I can't even buy a cup of coffee from my streaming royalties." - an anonymous Musician on Redditt
Music industry as a reflection of the capitalist economy
The next point of criticism is that big record labels already have tons of money to advertise their artists. They also have exclusive access to many of the Spotify playlists and can PR their artists excessively. This reflects the ‘wealth creates wealth’ attitude of the capitalist economy with big record labels making excessive profits from streaming, and non-mainstream artists barely getting anything. The streaming services also actively favour bigger artists for playlists (which is natural and understandable as they have more fans) but it also creates more barriers for smaller creators to breakthrough.
Musicians and music producers are, technically, workers in the environment where the means of distribution are controlled by the corporations which also count and distribute the profits without any consent or consultation from the creators themselves.
When we talk about Spotify redistributing profits, the ‘fairness’ of it is ultimately subjective, and someone’s wallet will suffer. However, for the big record labels, the difference is another million they are making, and for more niche artists it’s the question of whether they can pay their rent and make music as a career.
"Streaming is the future, but to deliver a rich and culturally diverse musical future, non-mainstream music needs to be able to keep its head above water." - Nadine Shah
An alternative: User-centred payment
To put it simply, user-centred payment means that your subscription money only goes to the artists you actively listen to. It is not an ultimate panacea as the streaming platforms are still facing the question of increasing the pool of royalties. But it’s the first step and would make a significant difference to independent/non-mainstream artists and niche genres. To highlight once again -it relies on the deducted following and artists having fans who actively stream their songs, it’s about a fairer treatment not an artificial award for underachieving creators.
But can Spotify just pay more?
In short: it’s complicated. To pay more, it will have to increase its pool of subscription payments via charging higher subscription fees and/or having a bigger number of consumers on paid accounts. It’s unlikely to be a burden on the public as even a half a pound difference would make a significant cumulative increase in profits. However, the subscription rate, as well as the revenues, have been growing anyway and musicians hardly saw an increase. So pushing for rethinking the process of counting the profits and redistributing the eared share would be more productive if we are aiming for the structural change.
The music industry has contributed 5.2 billion to the UK economy in 2019 (the latest aired statistic for now) and created around 200 000 full-time jobs - according to UK music and Oxford Economics. However, many musicians without whom this growth would not have happened are still struggling to make ends meet. While streaming opened doors for many creatives, the big corporations responsible for the music distribution should be called out to use their power and aim to create a fairer music industry for all.
