Spotify

With Spotify Wrapped making a return I thought I would look at the music distribution platform that has become the music industries new centre of power, Spotify. In 2006 Daniel Ek and Martin Lorentzon founded Spotify in Stockholm Sweden after making a breakthrough in the understanding of affordances offered by new digital technologies to tackle the issue of music piracy with a new music streaming platform. The app provides their consumers with an infinite amount of instant music curated through playlists and artist pages.

Spotify is doing everything it can to get you to listen to more music. An article in One Zero say Their level of customization and expansion of music knowledge create custom listening experiences for each of it’s over 200 million users.Which sounds on some level quite romantic but to understand how they do this is the use of the infamous AI algorithm known as BaRT, Bandits for Recommendations as Treatments. The BaRT system is Spotify’s central balancing act and the success of it is dependent on how desirable their music suggestions are. It tracks our listening patterns, anything from how long you listen to a song, the sweet spot being apparently 30 seconds, where you listen to your music and even when. Ever wondered how Spotify makes those genius advertisement campaigns such as billboards detailing “Dear person who listened to Justin Bieber’s SORRY 42 times on valentines day”? Well that was just a bonus of this data extraction. So not only is Spotify shaping and designing our own musical identity by using data and analytics but also completely changing the practices of the music business.

With streaming currently accounting for more than half of the global music industries revenue, Spotify comes across as some kind of secret sauce of the music industry. Especially as it battles every tech giant including music juggernaut Apple. Spotify is classed an intermediary in the music industry as it has the editorial capacity to transform it. In a talk on his book Platform Capitalism, Nick Srnicek explains that “platforms are the only business model adequate to the digital age” and therefore as an intermediary, their business model is positioned to capture and control as much data as humanly possible and for Spotify to collect the immense amount of data that it does, they create network effects by implementing cross-subsidization. By providing unprofitable elements you can attract more users and the more users that rely on the platform, the more valuable the platform becomes. Building more momentum for Spotify, meaning their algorithms are advancing and therefore creating this virtuous cycle. Spotify uses this process with their freemium subscription so a user can abuse their endless library but only if you can deal with an annoying 15 second ad every other song and always having to have wifi. 

In Srniceks four aspects, Spotify falls under a product platform as they transform music into services that can be in some way rented. The music industry had been losing money since the 90s until 2016 when it started to go up because we were purchasing music through these product platforms which you can see from the 7.44 billion Spotify now makes from the app each year. Spotify displays invisible politics as it is supposed to be value neutral but actually steers users into their sort of Spotify Core as journalists call it. The sound of Spotify shaping our music identity sounds quite nostalgic but in reality they are actually profiting off our interactions with their service to acuminate on a specific sound that does well in the music economy. This even influences the formula of modern songwriting, the branding of artists and the future of the music industry. And I think what determines this better than anything else is actually an interview made with the CEO and Co-Founder of Spotify, Daniel Ek.

In this Interview he said “You can’t record music once every three to four years and think that’s going to be enough. The artists making it realise it’s about creating continuous engagement with their fans. It is about putting the work in, about storytelling around the album and keeping a continuous dialogue with your fans. 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.”

This suggests that artists are only putting in the work when they are releasing music. That he views music as a commodity rather than an art, that he sees Spotify more like a social media platform where the aim is constant engagement and that Spotify should be creating rules and guidelines on how to create and release music. I don’t think it would surprise anyone to know that Mr Ek hasn’t had any experience working in the music industry but might be a bit of a shock to think that he is now kind of running it. I don’t think anybody in this industry would agree with his statement. Art takes time and people are not always in the right space to create. D’Angelo has a 14 year gap between Voodoo and Black Messiah. Quality over quantity am I right? I don’t think I would be the first one to say that Ariana Grande’s constant supply of new albums isn’t the way forward especially now Positions has been released.

An article written by Liz Pelly with BAFFLED discusses the issues of Spotify Core with an anonymous producer and songwriter for Spotify. He explains that it is normal these days to go into a studio and someone say they want to write a spotify song where they follow these formulated tick boxes like does it have a soft, cutesy, emoey style to it. Yes? Minimal verses? Yep. Does it give a nod to poster child Billie Eilish, yep, then its on all the biggest playlists for the next week!  Showing that artists are sacrificing their creativity to the taste of the playlists. As these sounds and strategies all have streambait clicks embedded in them making the Spotify style is just one of a number of pop trends that have emerged in the streaming era.

Pelly concludes that all of this caters to an economy of clicks where the most precious commodity is polarized human attention and where success is determined almost in advance by data. And with all this invisible politics, it’s not even equating to positive changes. In this article, Liz and the producer discuss the Spotify single “Psychopath” by Nina Nesbitt, Charlotte Lawrence and Sasha Sloan being put together for Women’s History Month. Now when I joined University, the career I dreamed of was working in marketing for Spotify at their headquarters in Stockholm or working with Head of Music Sulinna Ong. But as I made my own journey for the push of equality in the music industry using my own platform, I had a flurry of music industry pros tell me that was the biggest mistake I could make which finally made sense in this article when this producer working for spotify continued to say that it’s environment devalues music and that its too disposable. In such an economy, music that doesn’t take off is immediately dropped once it has outlived its usefulness either as a brand pop or a playlist filler. The problem is not the chill pop musicians but the self replicating system that continuously rewards the same styles, the ones that users will stream endlessly whether they are paying attention or not. In an addition of The Hour  with philosopher and digital artist, Matt Dryhurst, also chimed in that on spotify you will see a lack of attribution or accreditation, a placelessness to the music. Now this isn’t even the worst part!

Spotify is making these artists and songwriters jump through all of these hoops but then a stream is worth £0.0028 that means if you wanted to even have a Spotify subscription you would need to get 3842 streams just to be able to pay for it. This is what Liz Pelly explains as the difference between making a living off of art and a living off of spotify. So not only can artists not support themselves off of what they are paid by these services, it is changing the entirety of the creative process and also our relationship with music.Pitchfork mentioned that a 2017 research study by CitiGroup showed that only 12% of the music industry’s revenue went to artists confirming the alarming set up of this industry. . 

Now I think it’s gonna be interesting to see how we all tackle it. Somewhere Soul reports that Spotify are testing a new tool that will offer artists an algorithm boost in return for lower royalty rates. How it would work is that you would identify music from your catalogue that is a priority for you and then the algorithm would boost that music in artist radio playlists and in autoplay playlists. In return for this service spotify offers you a reduced promotion streaming royalty rate. The good new is that you can switch this feature on and off at free will to test how it works and see if it could produce a positive return of investment.

But here are the problems… 

  1. It does not address the root issue of low streaming rates
  2. It takes advantage of artists who are desperate to get their music heard
  3. If rolled out across the whole platform, premium subscribers will be essentially getting served paid promotions on what’s supposed to be an ad free platform

First spotify launched the contribution button to help support artists during covid and now this. It seems as if they will do anything they can to try and distract people from the core issue of paying artists too little. It was also revealed that the ceo said spotify are planning on increasing their subscription price. Is this a move to support a royalty rate increase for artists. I doubt it. Although if they do it would be a typical spotify move to make consumers pay for it.

Also it is reported by NME that MPs are set to examine the economic impact that music streaming is having on artists, record labels and the wider music industry. The committee will look at the business models of streaming giants such as Spotify and will take action to protect the industry from piracy in the wake of steps taken by the EU on copyright and intellectual property rights and look into the inquiry of artists getting paid so little.

So with things already looking to change how damaging platforms are to music culture. I think it is fascinating to realise how Spotify isn’t just making developments to the music industry but also advertisement, tech establishments and you can even refer to the political significance of Spotify in Sweden showing how these giants aren’t just evolving in creative sectors but also the world. A while ago I read Spotify Teardown: Inside the Black Box of Music Streaming where they looked at the role Spotify played in Swedish politics and how their role transcends as a distribution platform and additionally can be used as a point of reference in political campaigns to promote issues that are wider scope than the music industry alone.An article by Christopher Kullenburg and Rasmus Fleishers says that even before the official launch of its service, the company had a marketing strategy deeply entangled in politics. The Spotify founder wrote an open letter to Swedish politicians in which they proposed that housing regulation should be abolished, lowering taxes on stocks and putting computer programming in schools which resulted in a twitter campaign where people used #backaspotify meaning support spotify. And even when political leaders were asked about controversial copyright treaties, they often averted to talking about Spotify. Also in this article, it says that In effect these politicians also took part in the marketing of spotify as the new way to consume music, which was supposedly fair to the artists with regards to monetary compensation for their copyrighted materials. What I also find quite interesting is that the Former Prime and Foreign Minister of Sweden, even introduced offering Spotify premium accounts as a virtual gift for his colleagues pre loaded with playlists of Swedish Music demonstrating how Spotify is a source of Swedish national pride.

Now I mainly mentioned that because I thought it was amusing but also to pick on the topic of monopolisation. As I mentioned earlier, I watched a talk that Rick Srnicek did in reference to his book Platform Capitalisation where he sees platforms as capitalist actors and not economic actors and these platforms are capitalists businesses in a cut throat capitalist ecosystem, characterizing the digital economy. In regards to the future he discusses three possible features, one being monopoly platforms. This would mean that we are reliant on them and markets become a winner takes all business model. I think this sounds quite likely in the way that spotify might not only be a distribution platform but also a record label, an advertisement company, a copyright firm, a tech practice and perhaps the swedish government. The future of the music industry could be a massive, closed, expansive monopoly platform. With Spotify already being structured to expand data extraction, why wouldn’t they plan to grow this any bigger and in some terms they are.

But what does this mean for the future of artists in the music economy? Obviously Spotify will never be sustainable for independent artists, We don’t really know how long these platforms will be around for which is why it is so important to be working on alternatives and offer a better future than something that has the same name as a board game. So now my dream is to work for the next big thing that doesn’t cheat out artists or disrupt their creative ability. There are a lot of things the industry has learnt from Spotify but now we have to think how we can use that to invest in the next generation about to take over the industry.

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