In the last year, the Swedish music platform Spotify has gained considerable media attention in the United States with their free online streaming service. Although many are hailing it as a great way of discovering new artists and music, many are also criticizing the site claiming that it fails to properly compensate independent artists.
Spotify offers a free service that can be accessed online, while access from a mobile device requires a paid “premium” membership. Furthermore, the paid membership allows you to bypass the video and audio advertisements that are present with the free account.
In 2010, Napster founder Sean Parker invested $15 million in Spotify’s development, and has since been involved by sitting on their board. Spotify cracked the ten million user mark that same year, with a quarter of the accounts belonging to paying customers. After many delays and years of negotiation with major record companies, the site finally launched its US version in July 2011.
Spotify compensates artists via their record labels by paying for both downloaded content and streaming. In some countries, record companies have marked a significant increase in revenue since joining Spotify. Not everyone is happy however, American rock duo The Black Keys have gone as far as pulling their newest album El Camino off the site. So why are so many speaking out against Spotify?
Essentially, the compensation Spotify offers to independent artists does not match the percentage given to established labels, and in turn Spotify fails in providing independent artists a realistically viable source of income. According to an infographic by London-based visual data journalist David McCandless, a music artist would need over four million streams per month to earn the U.S. monthly minimum wage of $1160.
In the meantime, several have come to Spotify’s defense claiming that the website is meant as a promotional tool to raise awareness, not as a primary source of income. Others will maintain that it’s a matter of principle. Sam Rosenthal, founder of Brooklyn based Projekt Records, was openly opposed to the idea of adding his label’s artists to Spotify, later addressing the issue in a letter:
“In the world I want to live in, I envision artists fairly compensated for their creations because we (the audience) believe in the value of what artists create. The artist’s passion, dedication and expression is respected and rewarded. Spotify is NOT a service that does this. Projekt will not be part of this unprincipled concept.”
He would also point out that it would take a total of 3,461 streams to buy a cup of mocha at a local Brooklyn coffee shop, and that this doesn’t represent adequate compensation in any way.
The debate itself may say something on the state of the ever-changing music industry and the way we ourselves perceive artists in this day and age. It’s never been easier to record an album, however the same can be said about finding that same album online for free. Ultimately, everyone is forced to adapt whether it be the artists, the labels, or the websites; so is it a question of sacrifice for the sake of some possible bigger picture promotion? Or is it a question of principle, and taking a stand against artistic exploitation.