“Got paid £8 for 90,000 plays. Fuck spotify,” tweeted the London-based producer Jon Hopkins last week, comparing it to radio which pays “about £50 for each play.” His sentiments were echoed by U.K. producer Four Tet, who added “Spotify owned by majors who make money from shares and don’t care about paying artists.”
The tweet, coupled with news that another label, coupled with news that more than 200 labels were leaving Spotify with the distributor STHoldings, touched off a rehashed debate about online music distribution.
According to The Wire:
Tracks from over 200 record labels will be removed from Spotify, Napster, Simfy, and Rdio. Labels distributed by STHoldings include Hessle Audio, Skull Disco and Mordant Music. Out of 238 labels distributed by STHoldings (which specialises in techno, grime, dubstep, and bass music), only four said they did not want their content removed from the streaming services.
STHoldings said in a statement: “As a distributor we have to do what is best for our labels. The majority of which do not want their music on such services because of the poor revenues and the detrimental affect on sales. Add to that the feeling that their music loses its specialness by its exploitation as a low value/free commodity. Quoting one of our labels “Let’s keep the music special, fuck Spotify.”"
STHoldings said it made the decision based on a study that showed that music listeners don’t care about owning music if they can listen to it whenever they want (as you can with Spotify).
The debate is redundant; Spotify’s rates are so low that artists feel they’re comparable to being downloaded for free. Smaller labels have been dropping out of Spotify, most issuing public statements about the unfairness of the model. Napalm Records, an Austrian outfit which quit in September, put it thusly: “The income generated through streaming is so insignificant that neither we, as a record company, nor our artists are able to further support this method of distribution.”
But is the artist backlash enough to doom Spotify, which recently started staffing up in New York, on this side of the pond? American Spotify lovers will be encouraged to hear that the startup has been dealing with the issue for a year in the U.K., where the service is still thriving. For a good breakdown of how Spotify makes money, head over to the Guardian.