Spotify - anyone heard of it?

A+++ great post Glenn

I should say again, for people just joining us, that I work at Spotify, but am not in charge of any element of Spotify business policy. And while I do definitely defend Spotify, and streaming in general, as being a cultural good for music-listening and not obviously immoral as an overall business proposition, I think the whole streaming proposition is still at what we will look back on as an early state, and that neither Spotify nor the rest of the industry have good-enough answers to all of those hard questions yet.

And, in particular, the lack of transparency is not only one of the most obvious current weaknesses of the whole system, but arguably a material factor in all the other real and perceived issues.

I should say again, for people just joining us, that I work at Spotify, but am not in charge of any element of Spotify business policy.

You're just in charge of giving things silly genre names like "Escape Room".

Not just that, but yes.

It's now how payments are determined

did you mean "it's not" instead of "it's now"? not sure if im confused or if it's a typo

Yes, ugh. Proofreading failure! None of the main current streaming services set a per-stream rate, all of them actually pay by taking ~70% of revenue for a payment period and splitting it up according to stream-shares from that period. In Spotify's case (and I assume the others), this is actually done for each payment-option in each country, so the money from US full-price premium accounts is split up according to the stream-shares from just those account-holders for that period, same for the Canadian family-plan accounts, the Belgian ad-supported accounts, etc. So this is why the actual effective rates an individual artist sees will vary both across plans and countries and over time.

This is why it makes no sense to demand a change to the per-stream rate. It isn't a thing that is controlled directly. One can easily speculate that any given service's effective rate would probably go up if they raised their prices, but if, say, Apple Music unilaterally raised its rates from $10/mo to $20/mo, presumably many of its current subscribers would immediately cancel and switch to a $10/mo competitor. So it seems likely that the amount of money paid in royalties would actually go down even as the effective rate per-stream went up.

i appreciate you taking the time to discuss

Do you think the current pay-sharing system is sustainable from the artist side as the big companies try to get anywhere near 2000 numbers? It seems like 95% of current recording artists on your service don't see any meaningful direct financial benefit from being on there except that, as it's the dominant service, they either have to be on there or risk being ignored by audiences an industry alike? Is the argument that Spotify functions as "paid radio" and not as record "sales" at all? Or that it's most beneficial as a house for and long tail income stream for label catalogue?

Like: Are streaming services fairly priced?

I think the answer to this is "No", indisputably, for the artist. Compare it to a reasonable suite of streaming video services (Cable, Netflix, Amazon, etc.) and the price should, fairly, be substantially higher than it is ($30/mo would seem a minimum, to pick a number out of a hat). Whether a significant enough portion of users would continue the service, or whether Spotify itself (not streaming) would survive on reduced numbers are another question.

*continue the service at $30 or higher

I don't know how you can ask the question about fair pricing without also asking, how much profit does Spotify "deserve" to make? You might also ask, why is famously Swedish company Spotify legally registered in Luxembourg? And so on.

Spotify has never made a profit, iirc, so "deserve's got nothing to do with it."

For sure there are late-stage capitalism issues tied up in all of this.

you do not recall correctly

but yeah my larger point was that if we follow glenn in asking "the real economic questions" then they need to be broader than just consumer pricing and market forces

Sure, I don't pretend to know how one would determine a "fair" cut for the operators of a streaming service, and Spotify's historical unprofitability is, as has always been explicitly stated, a result of optimizing for expansion over short-term profit, and thus not inherently a defense of the current 30%.

But even if you imagine streaming services dropping their cuts to 15%, to match what Bandcamp keeps, that's only a 21% increase in what they would be paying in royalties, not anything like the 3x factor implied by the UMAW campaign.

User-centric payment models would make even less difference (and generally in the opposite direction from the one that advocates claim to want), with most artists likely to see no more than a ~5% shift, and the most popular artists tending to benefit more than the mid-tier and independent ones.

So that's why I, at least, do end up pretty convinced that my most economically-relevant goal, as a person working at a streaming service, should be to try to get more people more excited about and engaged in music, and thus more likely to spend more money on it and to discover and support more artists. I don't see any way in which the industry is going to support a lot more musicians by rearranging the existing money structures.

(Literal socialism would work, of course, and is my personal preferred solution, but that's outside of what I can work on with algorithms.)

What would the vast majority of artists whose streaming revenue is so low as to be functionally zero care if increasing the cost of a Spotify subscription to a fair level causes subscribers to leave Spotify and Spotify to go under? That seems like a problem for Spotify, not for the majority of artists.

Obviously that's not a solution, but it is a rebuttal to claims that you can't raise the price.

I'm not saying that we can't raise the price, I'm saying that if your goal as an artist IS to make more money, then it doesn't help you to make LESS money from fewer streams but know that the ratio between those two numbers went up.

If, as an artist, you don't currently care about your revenue because it's negligible, then it's even more likely that you would prefer more listeners over higher prices or rates.

If you don't care about money OR listeners, then probably the system is working fine for you already...

What would feel more fair to subscribers is more like "seven dollars of my monthly rate is divided by the 872 tracks I played, and then each 0.8 of a cent goes to the artist and label owning each track.

Like: Are streaming services fairly priced?

yeah obviously not. in an attempt to become a nigh-monopoly, Spotify set a goal to change consumer spending from hundreds of dollars a month to one hundred dollars a year. their "hear it in less shitty quality" option was not a link to buy a CD or download from the artist, but a higher-priced subscription to Spotify. literally devaluing music has resulted in music being a less sustainable option for musicians.

giving Joe Rogan $100 million of musicians' money to broadcast COVID-denialism might result in some of the user base dying, too, so that cuts the pie smaller.

how many Spotify subscribers were spending hundreds of dollars a month on recorded music in 2009?

Podcast acquisitions come out of venture capital, not music royalties. Everything Spotify spends money on, other than (I think) credit-card processing fees, comes out of the 30% cut after royalties are paid...

Even if no streaming services existed, and search platforms that helped users find piracy sites were rigorously prosecuted the way they should have been all along, and those piracy sites were hunted down by the WTO sic'ing the CIA and Interpol on them, music sales would be dropping in the modern era due to the slipperiness of how easy it is in an internet/iphone world to find vastly cheaper music listening substitutes to buying hundreds of dollars worth of cds/mp3s per year. I love spotify so much in spite of its flaws, but if it wasn't there, I would be using software to find radio programs from around the world, there would be enormous efforts made to make cool streaming radio stations famous, there would be websites that help you find exactly what kind of strange music you are interested in right now; and satellite/pandora style radio services would be more popular as well, many of them ad-free and subscription priced. This would be a worse outcome for the music listener, but how much better would it really be for the artists that want to sell mp3s? Would they really sell a ton of mp3s? Isn't the answer no, because that is what the Beatles/Zeppelin/Zappa estates and Drag City etc. found out when they tried not streaming for a decade, in hopes that not being on platforms would continue to drive sales demand?

> Spotify set a goal to change consumer spending from hundreds of dollars a month to one hundred dollars a year.

But this was only ever a lifestyle held by 5% of the population right? Every single adult I knew growing up had a stack of 20-100 cds amassed over a 10 year period. That's exactly the same revenue as Spotify. The difference is, Galaxie 500 fans were the types of people buying $100 of product a month. It's those people, us, who are making out like bandits with Spotify. So it is hurting the marginal artist's livelihood much more.

I don't see how we can go back to the way it was before. People are reading free content on the internet because if you charge for the WaPo,

...there are 10 similar articles to what you want to read on WaPo that aren't as well-researched but cover the same info and aren't paywalled. The same will happen will music and eventually television perhaps (as youtubers/twitchers take over more and more of the content pie)

I’m not sure on that last point, b/c ppl will always pay for superior content. But yeah, I know younger folks who came of age in the Limewire era and never bought a CD in their lives.

(I also agree that the literal devaluation of music is bad, and wish I had a solution behind still personally buying music that I’m a fan of)

*beyond

how many Spotify subscribers were spending hundreds of dollars a month on recorded music in 2009?

how many stopped is the relevant point.

Podcast acquisitions come out of venture capital, not music royalties. Everything Spotify spends money on, other than (I think) credit-card processing fees, comes out of the 30% cut after royalties are paid...

Spotify made $7.44 billion dollars in revenue selling other peoples' music to customers in 2019. The two founders have paid themselves billions of dollars. It would be good if musicians saw more of the proceeds of their creativity and labour than Joe Rogan or an executive from a marketing company, imo.

Whether or not Rogan's deal is fairly valued prima facie, the principal being paid out in that deal has been generated by undervaluing the labour of others, and thus removing their access to other forms of revenue.

(The deal also comes at the exact moment when the primary remaining form of revenue for most working musicians has been completely eradicated due to other circumstances, so it bites harder.)

― Bleeqwot (sic), Thursday, May 21, 2020 8:31 AM (nine months ago)

If the Rogan money comes from an exclusive pile contributed by venture capital investors, even if it was sought specifically to expand the podcast/spoken side of the business, those investors are assessing Spotify's value as created by exploiting the work of musicians.

(Signing Rogan was nagl when he was merely a credulous doofus platforming cryptonazis; it looks worse months into the deal when he's advising to avoid the COVID vaccines because zinc makes you immune.)

I'm not really here to explain capitalism, but the founders haven't "paid" themselves billions of dollars, that's stock-market value from ownership stakes. I agree that the stock market is a weird part of the economy.

(I meant "paid themselves" rhetorically in the sense of setting up the company's operations such that they get lots of money, not that it's specifically been in the form of fortnightly wages; if reports of their personal wealth are incorrect, apologies to the thread for my credulity or misreading. Glenn and I agree about socialism as well as the stock market.)

Couldn't help but think of this on seeing those RIAA revenue charts nosedive after the year 2000: https://www.nytimes.com/2000/05/11/business/5-music-companies-settle-federal-case-on-cd-price-fixing.html

The FTC said the cost to consumers of the record companies' illegal price fixing was $480 million over three years when yearly revenue was running at $20 billion, so it's not as if that alone was driving a substantial amount of the gains. We all know the internet is to blame for the post-2000 drop. The record companies' public and moral case was certainly not helped by years of illegally propping up prices though, and I doubt the average consumer draws much of a distinction between the record companies and musicians.

And it’s happening. From streaming on Spotify alone, we’re seeing growth from artists at all stages of their career: since 2017, the number of artists generating more than $50K/yr is up 80%; more than $100K/yr is up 85%; and more than $1M/year is up 90%. pic.twitter.com/x9sHxddEDq

— Daniel Ek (@eldsjal) March 18, 2021

these stats are not very reassuring

i was still buying CDs when i could throughout my years of pirating and i stopped when i started streaming. i'm sure i'm not the only one. i use spotify every day and i'm pretty sure it's been a bad thing for music in general and for my relationship with it

and yet

here’s one. how come spotify can never remember that i want to listen through my airplay speakers? i select them many times a day. i literally never want to listen through my phone speaker. so why does it always default to that?? it’s the little things. like connecting to speakers.

$100,000 worth of medical advice from Rogan and Jim Breuer. The experts thought this pandemic was going to be bad at the start, but it's all overblown and the doctors just won't admit that they got it wrong. Only 6% of the reported deaths are real. Nearly everyone who has died of it is obese anyway. Don't take a test, because then the government will know if you have it. Doctors should just give you zinc and steroids to make it go away if you tell them you have it, which you know for sure because you gave it to your wife (who has stage 4 cancer) and one of your daughters, and your other two chickenshit daughters moved out of the house wearing cowards' facemasks. You didn't tell anyone until three months later, though, because you didn't want any promoters to cancel your comedy club bookings. Also, people transition gender for sympathy bcz if "they were marginalized for being genuinely dumb people, if they transfer over and become another gender, then they get praised."

hey stet fyi that dollar signs break url tags

"$100,000,000 worth of..."

why is this here

hey remember when everyone insisted rogan wasnt that bad

Yea,I loved Newsradio

glad to see Breuer still seems perpetually drunk

why is this here

because spotify is paying joe rogan $100 million for it

Still haven't heard of Spotify

I love how I sometimes forget that Spotify gave an idiot covid denier conspiracy theorist one hundred million dollars, then I go 'oh hey remember when Spotify gave that idiot covid denier conspiracy theorist ten million dollars? Ten million dollars, that's insane! Oh wait...'

My latest spotify gripe/workaround is the way that the "Song Radio" feature functions. I would have expected that "Song Radio" would play songs similar to the one I've selected. What it seems to actually do is pick the midpoint between the selected song and Spotify's music taste profile it's magic'd togetherfor me, which usually means I get songs that I already have Liked or music that sounds nothing like what I seeded. I've found to get the behaviour I expect is to create a new playlist containing just that song, and then the Recommended Songs actually do seem all to be closely related. I found some incredible stuff this way that I would otherwise have had to wait for Discover Weekly to dredge up.

The perfect solution here would be for there to be some kind of Algorithm Personalisation slider somewhere, but as discussed upthread somewhere, Spotify aren't really into giving users control of their experience in that way.

this annoys me as well, I used to love the autoplay feature but these days it tends to just always play the same stuff. Everything even vaguely electronic always gets me:

- something from the latest autechre albums
- Leaves Against The Sky by Actress
- I Don't Love Me Anymore by Oneohtrix Point Never
- Dismantle by Andy Stott
- after that other tracks from these same albums with a couple of other more random artists mixed in

It used to be much more varied than this

A less varied autoplay list might have come from the algorithm becoming more conservative over time (Algorithm Personalisation slider set to high), or it could be that since Spotify knows more about someone the more they use it, the personalised data might "drag" the autoplay selections towards stuff Spotify already knows you like. Either way, it's a weird quirk and it would be nice if the spotify boffins would sort out.

I find Spotify does a great job surfacing new music but once you start going back in time even a couple years you often get the same stale popular tracks.

Perhaps it has to do with the way the algorithms are trained. For new songs, there is little to no previous engagement (the "cold start" problem) and recommendations are made based on underlying track attributes (see https://medium.com/cuepoint/visualizing-hundreds-of-my-favorite-songs-on-spotify-fe50c94b8af3 for some examples - Loudness, Danceability, Valence, Energy, etc). For old songs, there is years of data and success labels may be created based on engagement - i.e. a customer listening to a song for a certain amount of time. These labels are used to train supervised recommendation models where the content-based features are used only as part of the prediction. You end up with a situation where the tracks that are most broadly appealing to the largest number of people get promoted, creating a feedback loop that turns off power users who want more diversity.

There are some extremely smart people at Spotify working on this issue but it is a difficult balance to strike between recommending new and interesting songs and giving people stuff that has been successfully recommended in the past.

Yeah, a more discovery-oriented radio option would be nice. I don’t think It’s that much down to personalization as if I start the same song as radio on my wife’s account I get similar results (though I guess our listening patterns aren’t wildly dissimilar in the grand scheme of things).

I got frustrated with this recently doing some disco/hi-NRG artists' radio playlists on a road trip. It seems like what's going on underneath the surface is the algorithm 1) finds similar artists, probably a mix of Netflix-style collaborative filtering and musical content analysis and then 2) recommends some of the most popular tracks from those similar artists. (Alternately, they could be doing it at the track level and then applying a diversification or ranking scheme to ensure both similarity and variety at the artist level, but the result is similar.)

Discover Weekly seems to do a really good job if you are listening to a lot of new music.

It keeps dumping my recent activity and recent searches recently. So I have to look things up instead of having the links already populated.
Or last week it had the images for links up but wouldn't connect with tehm and just gave me a message saying something went wrong.
What is up with this device