In a series of recent critical tweets, the Future of Music Coalition called it a “wage suppression scheme”. The Discovery Mode function, which will be rolled out to more artists and labels alongside the new changes, offers promotion in exchange for a lower royalty rate. In some instances, Spotify has actually reduced the amount it pays for music. ” Last week, the head of Warner Music, Robert Kyncl, said music is the lowest form of entertainment in terms of monetisation when compared to TV and film. Earlier this year, Lucian Grainge, CEO of Universal Music, said: “the critical contributions of too many artists, as well as the engagement of too many fans, are undervalued. The changes come at an interesting time for Spotify, which is still igniting debate over its payout model. Top of the pops … Kate Bush’s 1985 hit Running Up That Hill was the fourth most streamed song in 2022, with 465 million plays. Streaming rates are a race to the bottom.
In reaction to Spotify’s update, independent artist and producer Thys tweeted that digital music “is a convenience, a service” and artists should instead focus on generating revenue on other things, like shows, physical sales and digital sales on platforms such as Bandcamp (although new RIAA figures pointed out that downloads now make up just 3% of recorded music revenues). If Spotify gets it right, McGaughrin says the updates could help an artist build a better long term business. Spotify’s announcement posits the platform as the solution to artists feeling spread thin, “pulled in every direction” across multiple platforms to try to build a level of engagement that results in a career. This creates a situation where “artists can be streamed multimillions of times but won’t be able to sell a ticket in their home town”, says music manager and record label co-owner Peter McGaughrin, who works with acts including Everything Everything, Nilüfer Yanya and Alfie Templeman.
The success of one viral song doesn’t necessarily translate to the rest of an act’s catalogue. This has scarcely been possible within Spotify thanks to a lean-back listening experience that prioritises playlists, without the need for any further engagement beyond pressing play. This evolution is about bringing the platform and Spotify to life in a deeper way.” Many of the updates are focused on creating avenues for creators to monetise their work Tom Connaughtonįor artists who want to build a brand, creating a world around their music and showcasing who they are as a person is key for long-term engagement with fans. “Previously, you probably thought of Spotify as the best destination for listening. The changes are designed to create “deeper discovery and more meaningful connections between artists and fans”, says Tom Connaughton, MD of Spotify UK and Ireland.
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