IF YOU CARE ABOUT MUSIC, SHOULD YOU DITCH SPOTIFY?
On Tuesday, a press release from Nielsen SoundScan announced that Jay Z’s “Magna Carta… Holy Grail” had experienced “the biggest first week for an album in Spotify history,” with “over 14 million streams in the U.S., topping recent new releases from Mumford & Sons, Daft Punk, Justin Timberlake, Kanye West and many more.” The album also had “the biggest single day for an album in Spotify U.S. history.” But here’s something, call it a hedge: Jay Z (whose midlife-crisis red Ferrari was removing his hyphen) sold a million copies of “Magna Carta” to Samsung at five dollars a pop. They were then given away for free to a million Galaxy phone owners seventy-two hours ahead of the official release date, through a specific app, which was apparently buggy, to the dismay of the rapper, who was nonetheless not dismayed enough to return the five million dollars he’d earned before the album was even available for purchase.
The Samsung deal does not sound like the plan of a man who was depending on Spotify for revenue. (The album went on to sell a million traditional, non-Galaxy copies in the first two weeks.) But this is only inference; there have been many explicit complaints about the streaming service. A few days ago, the collaborators Nigel Godrich and Thom Yorke removed a batch of the albums they’ve been involved with from Spotify. Godrich took to Twitter to explain why Atoms For Peace, Ultraísta, and Yorke’s solo album “The Eraser” would no longer be available. This Storify thread condenses tweets from both Godrich and Yorke, who was less vocal, into an adequate summary. (To read every single thing Godrichand Yorke tweeted on this subject, visit their respective Twitter feeds.) The shortest version is that the Spotify model does not favor new artists. The larger grumbling about streaming services in the musician community is that the various services, which are governed by fluid and complex laws that are changing as we speak, favor nobody but the major labels that helped fund and grow some of them.
David Lowery, of the rock band Cracker, recently posted a royalty statement from the “internet-radio” site Pandora and then posted similar statements from satellite and terrestrial radio stations, exposing the extremely low revenues he received from Pandora. Which should probably concern you, at least a little.
On Twitter, Godrich’s main point was that Spotify is geared to reward catalogue recordings (he mentions EMI’s golden pig, Pink Floyd) that have long since recouped any costs and are profitable for labels. The rates for these catalogue streams—though most are unaware of this—are higher than rates offered to smaller, newer acts.
The issue beneath all the complaints about micropayments is fundamental: What are recordings now? Are they an artistic expression that musicians cannot be compensated for but will create simply out of need? Are they promotional tools? What seems clear is that streaming arrangements, like those made with Spotify, are institutionalizing a marginal role for the recordings that were once major income streams for working musicians—which may explain the artist Damon Krukowski’s opinion that music should simply be given away, circumventing this entire system. But first, some words from Godrich, from his Twitter feed, condensed and edited for clarity.
We’re off of Spotify. Can’t do that no more, man. Small, meaningless rebellion. The reason is that new artists get paid fuck-all with this model. It’s an equation that just doesn’t work. Plus, people are scared to speak up or not take part, as they are told they will lose invaluable exposure if they don’t play ball. Meanwhile, millions of streams gets them a few thousand dollars. Not like radio at all. If you have a massive catalogue—a major label, for example—then you’re quids in. It’s money for old rope. But making new recorded music needs funding. Some records can be made in a laptop, but some need musicians and skilled technicians. These things cost money. Pink Floyd’s catalogue has already generated billions of dollars for someone (not necessarily the band), so putting it on a streaming site makes total sense. But if people had been listening to Spotify instead of buying records in 1973, I doubt very much if “Dark Side” would have been made. It would just be too expensive.
Streaming suits catalogue but cannot work as a way of supporting new artists. Spotify and the like either have to address that fact and change the model for new releases or else all new music producers should be bold and vote with their feet. Spotify say they have generated $500 million for “license holders.” The way that Spotify works is that the money is divided up by percentage of total streams. Big labels have massive back catalogues, so their forty-year-old record by a dead artist earns them the same slice of the pie as a brand new-track by a new artist. The big labels did secret deals with Spotify and the like in return for favorable royalty rates. The massive amount of catalogue being streamed guarantees that they get the massive slice of the pie (that $500 million), and the smaller producers and labels get pittance for their comparatively few streams. This is what’s wrong. Catalogue and new music cannot be lumped in together. The model massively favors the larger companies with big catalogues.
However, Spotify needs the new artists to be on the system to guarantee new subscribers and lock down the “new landscape.” This is how they figure they’ll make money in the future. But the model pays pittance to the new artist right now, an inconvenient fact which will keep surfacing. I feel a responsibility to speak up when I see something going on which I think is unfair. It’s up to streaming providers to come back with a better way of supporting new music producers. It’s not for us to think up how it could work. That’s your department. Over. That’s all I gotta say really. Sorry for the rant. Actually; one more thing: read this.
What Godrich linked to is a Pitchfork article written by Damon Krukowski, of Galaxie 500 and Damon & Naomi. This piece stands as one of the clearest explanations of streaming revenue. (Yorke ended his less detailed tweeting with a link to this Guardian editorial by the independent musician Sam Duckworth, who confirms that, as Yorke and Godrich said, Spotify does little for small artists.) It is best to read Krukowski’s entire piece, but, in short, it touches on the slightly mind-bending rules around which service is compelled to pay which fees to whom, and the larger question of how these services relate to music, if at all. What is being exploited and sold is a functionality—the Web, wired and otherwise—that can bring you music in plenty of ways.
Krukowski responded to Godrich and Yorke through Twitter, after Godrich had already linked to his article. His punch line in these tweets was slightly more radical (and shorter) than his Pitchfork piece: let’s just make recordings free and entirely disable companies like Spotify. We had a brief exchange about the streaming world, also condensed and edited:
Damon Krukowski: I’ve always been fascinated by the fact that at the beginning of recording, the courts ruled that you couldn’t copyright a given performance of music because it was nothing more than vibrations in the air—and who can say they own the air? As I understand it, the history of record “labels,” “mechanical” royalties, album art, and all the rest began as an end run around that rather pataphysical ruling. Recording companies were looking to copyright all they could, since they couldn’t lay claim to the immaterial vibrations at the core of their products.
So here we are at the other end of that long century of cylinders, records, tapes, and discs, with more or less the same problem that started it all—because who can say they “own” a digital stream of information, any more than the air?
Spotify, Pandora, Apple, and the rest are doing what they can to make us believe they own that stream, just as recording companies did by copyrighting all the ancillary bits of albums. But they don’t. Just like the record companies at the beginning, they own only the means of delivery, not the music itself.
I think if we accept that basic truth—that no one can own the stream, any more than the air—then we can start from a more solid place to rebuild how and why we might compensate those involved in the production of recordings.
Sasha Frere-Jones: How, logistically, do we do that? It is still fairly easy to get a free copy of almost any recording through torrent clients, often in audio formats more sophisticated than any offered commercially for sale. (There is a growing cohort of amateur audio buffs who use their own high-end gear to produce digital files, like Professor Stoned, who is just one of thousands providing better digital fidelity than iTunes has ever offered, or likely will.) For those who don’t like to dig, Spotify is a pretty handy tool for quick discovery and recovery, but I would happily never touch it again if I could pay into a service that compensated artists more fairly. (My own band’s label, Southern, pulled all of our records for a while, exactly for the same reason Godrich and Yorke did, though I think the albums may have returned.) What would the new world look like?
Krukowski: Ooh, thank you for that Professor Stoned link! Along those lines, I’ve been a follower of Mutant Sounds—but it and a number of music blogs have gone off the air, so to speak, because the file-sharing services they depend on have been closed or pressured by anti-piracy to take their files down.UbuWeb persists, and is an incredible resource for the avant-garde altogether, but its publisher Kenny Goldsmith’s mantra is “don’t trust the cloud”—he’s always urging his followers to download the files now, while they still can. It’s like this briefly wild, lawless digital era is coming to an end, as its channels are monetized. Or maybe we could even say they are only now being privatized, after having existed in a kind of pre-property idyll.
But back to your question about the world ahead—I feel a bit like those Marxists when they are inevitably asked, O.K., but what happens after the state withers away? It certainly sounds like a dodge, but I sincerely think we won’t know till it happens. Or then again, maybe it has already happened, without our realizing—recordings are already essentially worthless in the marketplace—and it’s these heavily capitalized businesses like Apple, Spotify, and Pandora that are setting the agenda for the new order. I don’t think they have a claim over it, not in a moral and I am pretty sure not in a legal sense, either—but they are the ones loudly staking the claim. What I’m thinking is, What if we call their bluff? Maybe no one will end up being paid for recordings, in that case—but as it stands, musicians aren’t anyway.
Frere-Jones: It bears repeating the obvious here, as a dark sort of coda, that recordings have often been poor sources of income for artists. There are major-label artists that never manage to recoup the money spent on their albums, and earn like sharecroppers. Or I could just look at my own band, Ui, now defunct. Nothing went wrong with our career—we just played instrumental music and didn’t tour particularly energetically, so we sold in the fairly low thousands. Even with relatively low costs, the albums only barely recouped. Our income from recordings probably adds up to no more than a few hundred dollars, which doesn’t lessen my love for them. I’d happily put them up for free on the Web in high-resolution formats. And that, paradoxically, might move a few of the vinyl copies that Southern has stowed away in its warehouse somewhere. It was kind of them to put up with our lazy asses in the first place.
Krukowski: I think it’s true in book publishing as well, that everything pretty much loses or breaks even, except for the monster hits which pay for it all. That model is broken if nothing can break anymore. But maybe it’s not such a good model to defend?