Spotify CEO Daniel Ek said in an interview with Music Ally that he believes artists not being paid enough from streaming revenue is “narrative fallacy,” and that the new music landscape requires “continuous engagement with fans.” Throughout the duration of the coronavirus pandemic, which has put an indefinite pause to live shows and much of musicians’ revenue, Spotify has come under criticism with artists saying they aren’t making enough off of streaming to survive.
Ek made the suggestion in his interview that the days of releasing albums and touring for a year or more following its release are now in the past. Ek instead suggested a better way to gain revenue would be to continue releasing new music in order to gain more overall streams. He highlights the need for fan engagement, and the need for artists to maintain their audience.
“There is a narrative fallacy here, combined with the fact that, obviously, some artists that used to do well in the past may not do well in this future landscape, where you can’t record music once every three to four years and think that’s going to be enough,” Ek said in his interview with Music Ally. “The artists today that are making it realize that it’s about creating a continuous engagement with their fans. It is about putting the work in, about the storytelling around the album, and about 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.”
Questions on whether Spotify should change the way they pay their artists have been around since its inception. The service charges listeners $9.99 month for a catalogue of nearly every song in existence, and divvies up artists shares by paying them the same percentage of how much their song had been listened to in comparison to those which had been streamed the most. However, a 2017 study from Digital Media Finland found that the top 0.4 percent of artists were receiving 9.9 percent of revenue, when according to the “user-centric” model Spotify promotes, the 0.4 percent should only be receiving 5.6 percent. Meanwhile, an article from Pitchfork pointed out that some artists who are less popular have made only $15.50 for 3.5 million total streams.
Spotify has also gained revenue in the midst of the coronavirus pandemic, according to their last financial report released two days ago. The streaming service has had a 27 percent increase in subscribers to the Spotify Premium service, and is ahead of both Amazon Music and Apple Music.
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