It was reported about a week back that not only did Taylor Swift keep her latest album from being available on Spotify, but when she was criticized by the music streaming company for that action, all of her music was pulled from Spotify. This has led to debate about royalties paid to artists and whether or not they’re enough to fairly compensate them for their work. Spotify certainly seems to think so. CEO Daniel Ek clears up many points about their business in a detailed blog post today.
When Taylor Swift was asked why all of her music was pulled from Spotify, her response made it seem like Spotify was not fair in compensating artists for their work. Many pointed it out as a larger problem with the streaming music business model as a whole.
Though Spotify is having none of it. Ek writes today that royalties paid to top artists, such as Swift, “are on track to exceed $6 million a year.” He also revealed that so far Spotify has paid out over $2 billion to artists, labels, songwriters and publishers, so one can’t exactly say that this music streaming service isn’t giving back to the community.
Ek also pointed out that a large chunk of money goes to labels and publishers for subsequent distribution to artists and songwriters. “If that money is not flowing to the creative community in a timely and transparent way, that’s a big problem.”
The CEO also points out that people’s listening habits have changed. Indeed, many surveys have found that music sales are on the decline while subscriptions for music streaming services are on the rise. So Ek makes the case, “we use music to get people to pay for music,” and come to think of it streaming is better than piracy, which doesn’t pay at all.
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