It's a service very few people use that costs them money to maintain and support. You already need to go through cdbaby and similar services for all other distributions and being just on spotify instead of all of them is not very appealing.
I'm not a Spotify expert so I'm not understanding why independents artist without labels "costs money to maintain support" that isn't already spent to enable the labels to upload their artists' songs.
Let's say a Universal Music Group[1] representative logs into Spotify's system to upload Justin Bieber's latest 4-minute song. (Spotify has spent money on their backend system to enable this upload workflow.)
Why does it cost more to Spotify to let the unknown-Joe-Blow-not-signed-to-a-label upload his 4-minute song?
Unless I'm mistaken, Spotify would get the new Bieber automagically via an ERN (Electronic Release Notification) delivery which contains asset links, artist, meta, rights information etc. Since that's from a trusted* source, it can be ingested as-is and everyone is happy. For independent uploads, there's almost certainly several steps of human review and possibly interaction - which costs money and time.
The same type of questioning applied to banks and transferring money:
Why would it cost a bank more money to print and mail checks to individual people when they already do balance transfer payments every night to other banks and branches?
It all boils down to that Joe Blow is an unstrusted actor and big label is not. They needs to check that Joe Blow is not uploading Bieber's latest song as his own and that all the metadata is correct while they not need do that for most labels.
Opening it up to everyone would have transformed the industry. Spotify could absolutely own the small artist space in the same way that Amazon owns the self-publishing space for unsigned authors, but it chooses not to for political reasons.
This has nothing to do with copyright issues. Spotify already has a copyright claim process and the major labels have their own copyright monitoring systems.
I make music as a hobby, and I only really use soundcloud as a result, since the barrier to entry to posting on spotify is annoying, and resultingly a pretty decent chunk of the pretty obscure stuff I like isn't on spotify, only soundcloud.
When I go to spotify right now it feels like this weird corporate arm of the archaic record industry that I view as more or less a parasite on musicians in this day and age. It lacks all of the weird community character and fluidity that I want out of a music platform, and I resist it for that reason.
Opening the gates would change the game and let it exist as a real creative community rather than just a soleless distribution platform for corporate artists and their masters.