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Comment by dpflan | Hacker News Reader

(Wu-Tang’s C.R.E.A.M. playing in the background)

“Spotify will have the means to absorb this tax, but Spotify will disinvest in France and will invest in other markets,” Monin said in an interview with FranceInfo last week. “France does not encourage innovation and investment.”

What will the CNM (Centre National de la Musique) do? Could it be encouraging “innovation and investment” in France? While Spotify loses some profit and share price, but then may have to innovate and invest in this new business environment.

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“ France does not encourage innovation and investment”… in foreign media companies. They’re using the tax to fund local investment in music.

No, in general. It's a tax hell, the state is capturing about 43.5% of GDP for very questionable results on every plan (security, education, health, etc.) The money will be diverted to friends of friends that don't need it in the first place.

Source: myself, looking at starting a company there.

Every time you figure out an obstacle - an obscure regulation that affects you and how to beat it, which bureaucrat can assist you in these matters, which politician you can affiliate with to make red tape get cut - you are also creating a moat. Even better, if you get competitors, you can speak to your government contacts and get your competitor mired in the same red tape.

While you personally may be able to overcome this, the net result across the macro economy is one of stagnation and slow growth. It does not encourage innovation. Such is the situation in France.

And France has the highest government expenditure as a percent of GDP among the developed world, at >58% as of last count[0].

[0]: https://en.wikipedia.org/wiki/List_of_countries_by_governmen...

This is more or less true for whole of Europe. A look at historical GDP growth gives a big hint - around before 2010 the EU and USA were on par, after that while the US grew and innovated Europe has chosen bureaucracy, taxation and fighting with business aside from the state owned ones.

Interestingly, some of those moves by the EU (like the GDPR) are widely popular with citizens around the world, to the point where some US jurisdictions have been working on their own copies.

So perhaps there is worthwhile innovation happening in the EU after all?

“Innovation” is tech-man speak for “figuring out how to privatize/shift profits to our company” in the press. Sort of like how “the economy” can usually just be translated to mean “rich people’s yacht money”

Innovation is also CRISPR, LLMs, reusable rockets and lithium-ion batteries. Potently, many were discovered in Europe but developed in America.

> “the economy” can usually just be translated to mean “rich people’s yacht money”

Mississippi, one of the poorest US states and one widely panned for having "backwards" economic policies (meaning low levels of redistributive taxation), has a higher median household income at nearly $53k[0] than Germany, the country with the best economy in egalitarian Europe, at roughly $46k[1]. So it's definitely not just yacht-owners that are the beneficiaries of economic growth in a laissez-faire capitalistic country.

[0]: https://www.census.gov/quickfacts/fact/table/MS/BZA115221

[1]: https://allaboutberlin.com/guides/salaries-in-germany

SO sorry that it took me so long to respond to this, but your math felt wrong, so I looked into it.

[1]Mississippi PER CAPITA income: 29K [2]Worst German State PER CAPITA income: 34K

I have no idea what All About Berln is, and when I looked into their dataset it was...confusing. So I went to Wikipedia. I think you were comparing Household vs Per capita?

Either way, Mississippi isn't the doing as well you're claiming. They also have a 19% poverty rate [1] compared to Germany's 11% [3].

[1]https://www.census.gov/quickfacts/fact/table/MS/BZA115221 [2]https://en.wikipedia.org/wiki/List_of_German_states_by_GRP_p... [3]https://www.statista.com/topics/10455/poverty-in-germany

Better than going to your existing Big Tech management and shareholders. France is supporting "Buy Local" at nation state scale. When the US "grows and innovates," it's mostly extraction at scale for shareholder benefit. Railroads (precision scheduling), healthcare, finance (credit card rails 3% economy rake, financialization of all the things), shareholder investor owned utilities, tax prep, etc.

It's always nice to see a country push back on the tech/intellectual property equivalent of the East India Company concept. Colonialism and empire building isn't dead, it simply expresses itself as multinationals on top of capital markets in the current incarnation. Don't invite the vampire in. When someone says "GDP" or "growth," politely ask them to show whom is benefiting (and to what degree) from numbers championed from a spreadsheet.

(i am sympathetic to the plight of your run of the mill, well intentioned startup founder focused on problem solving, but also not blind to the bulldozers I mention above)

Are you serious? Better going to a government with no added value vs a company providing a service for a monthly fee?

Very serious. It is an opinion that it is no added value. Show me evidence that the French government is providing a lower quality of life than say, the US government. GDP and growth are poor measures of quality of life. Certainly, you are free to not participate in the market if you choose not to as a business owner or service provider. It is very likely nothing of value will be lost.

Spotify's CEO is worth ~$3B while artists make pennies. Why would you incentivize such a structure unless your mental model tilts towards that being acceptable? I'm not saying this should be free or a utility, but it should probably be a business of a couple hundred people with a reasonable valuation target. As a nation state, you can say no. Europe does this, China does this. It can be done. "I would like to submit a bug report." The only people wringing their hands are those who would profit from the VC/tech fuckery ecosystem extending its reach. Don't let them; cut them tentacles seeking a moat/regulatory capture/entrenchment right off.

We can do better, and I feel no shame in stating such a position.

https://www.google.com/search?q=quality+of+life+france+vs+us

https://www.cnn.com/2010/WORLD/europe/02/11/france.quality.l...

https://www.expat.hsbc.com/expat-explorer/expat-guides/franc...

https://www.oecdbetterlifeindex.org/countries/france/

https://www.brookings.edu/articles/should-we-try-to-live-lik...

really doubt artists are going to do better than pennies in france vs anywhere else. US is a good place to be an artist.

Not so much about artist comp going up as it is about driving down comp and valuations for these "tech" companies who attempt to use leverage to get their way.

It's about power. Always was, always is (once you're passed a certain fiat amount; only so much "line goes up" before it no longer matters). As Theodore Roosevelt said about highest tax bracket taxpayers who might leave the country, "we wish them well!" Call the bluff of these people, they're the ones with something to lose. If they push too hard, make them lose.

The rules are flexible, all of this (economic systems) is a shared delusion. Be mindful of this when negotiating and operating within the system.

US is a good place to be a good artist. France is a good place to be a subsidized artist

Only if you conflate worldwide mass appeal with "good". It's a viewpoint, but far from the only one.

> Spotify's CEO is worth ~$3B while artists make pennies.

That sounds like the market signaling an underproduction of streaming services and an overproduction of musicians. A levy on streaming services earmarked for French artists pushes the market further into disequilibrium, giving people less of what they want and more of what they don’t want.

Almost all the links you provided show USA having a higher quality of life than France in almost every way. For instance the first link of the google search (at least for me) was

> https://www.numbeo.com/quality-of-life/compare_countries_res...

And then this

>https://www.oecdbetterlifeindex.org/countries/france/

shows USA as having in some ways having dramatically higher quality of life metrics, and minimally lacking only in a couple of ways.

I think it's sad because the problems France has could easily be fixed by liberalizing and minimizing the economics. But the french people are extremely against that and so it will practically not happen. And France is rich enough due to historical reasons that it'll probably never be compelled to do so.

Of course, USA should really be compared with EU, not a state like France. Comparing individual US states to France would be more accurate. Unfortunately, such metrics aren't usually available since USA is always considered a single entity in these reports.

France provides working services and a safety net from taxing a GDP per capita that's half of that of the US.

Of course you think that government spending is useless if your reference is the US. It's a country that is useless at serving its citizens.

(1) The music industry? (2) Working musicians who make contemporary music people want to listen to? (3) Paying to maintain a big classical music hall that people think other people should listen to? (4) (3) only if they play Debussy instead of Bach?

Repeat this until you understand how funny it sounds

I'm also unsure of any innovation Spotify has made in the world of music.

Some searching has led me to the end of year recaps and a lot about advertising. Guess France will miss out.

From my perspective they made streaming a vast catalogue of music legally a business. I’ve been a user for a long time and been able to discover a lot on their platform although I must admit quality of recommendations seems to be falling lately. Last.fm was great at that

It’s amazing that somebody could say this with a straight face. Spotify are so successfully innovative that they basically ended music piracy.

I thought that was apple and pandora?

Pandora was an alternative to radio, not to pirating music, and Apple probably contributed more to music piracy than any other company. Nobody was filling their iPods to the brim with $0.99 songs, they were filling them up with pirated songs that they imported into iTunes.

I’m sure the corpos that it hurt are grateful, but who cares from the consumer or artists side?

Piracy is a costing problem and Spotify’s solution is “keep costs to the consumer low and money in our pockets by keeping it out of the artists’ hands”. Piracy was also the leverage they originally had on the labels (better to collect 5 cents than nothing, right?) before network effect and inertia took over.

They didn’t kill piracy, they co-opted it.

> I’m sure the corpos that it hurt are grateful, but who cares from the consumer or artists side?

The reason Spotify was able to out-compete piracy (which is ostensibly free) is because it provided a substantially better experience to users. I’m sure the artists don’t get a great deal out of it, but it seems weird to blame that on streaming. Artists losing out to big business has been the entire model of the music industry since forever.

In any case, even if you think Spotify is fundamentally evil, and their innovations are extremely harmful, that doesn’t take anything away from how innovative they were. Which is very, very innovative. They completely changed the whole music industry world wide.

> They didn’t kill piracy, they co-opted it.

Trying to claim that one company licensing a music catalog, and then selling it to consumers is “piracy” is a terrible take, and just makes you look like you have some weird and extreme views on this topic.

If only the UX wasn't god awful shitgarbage. It manages to be underfeatured and obscure and just plain annoying (can I please see all music by the artist?) at the same time. A friend told me that UX designers he used to work with used to mock Spotify and took it as an example for how not to do things.

A private collection and a player like Clementine is so much nicer. It's not like Spotify has everything, anyway. Not even original versions of songs if anyone released an arbitrarily bad remaster.

Back when they were in the “acquire users” phase (when all of this innovation was happening) the UX was much better. Now they have acquired users and are in the “exctract value” stage it’s all going to hell ;(

99c on iTunes and later streaming on Groveshark killed mp3 sharing.

Spotify cleaned up the legalities of it, but they weren't (and still are not) innovating.

Those end of year recaps are a highlight for me. I really look forward to it every year, along with comparing against my friends.

They also have a really nice API, which has admittedly been getting more and more locked down, but to claim it was not innovative, especially at the time, is farcical. All this without even mentioning, as other posters have, their effect on legitimizing music streaming. Also, and each user has anecdotally different experiences here, their music recommendations for me are top notch. I've discovered just so, so many pieces of great music through their service.

I used to pirate everything and then Spotify came along, since Spotify I have not pirated once. I’ve used it almost every day for over 10 years. I listen to much more diverse music now. This experience is commonplace. I would say completely changing how a generation consumes music is innovative.

You might think this if you listen to mostly pop music, but I remember the day of having to find pirated uploads on YouTube or pirate the music myself just to listen to music that wasn't from a major label. There was grooveshark but that was pirated music.

Spotify was the first streaming service to let you listen to any type of music from any place in the world. The only place to do that before them was YouTube but this was before you could listen to YouTube videos in audio format.

Spotify has best in class discoverability with generative playlists and recommendations for any type of music. You can find Spotify generative playlist for the most niche music genres.

I uploaded a single electronic music track on Spotify 10 years ago without using a label or advertising it other than to a few friends on FB and it has 100k plays. The same song on YouTube has a few 100 plays.

Again if you just use Spotify to listen to popular music then yeah it will definitely feel like it not much compared to anything else, but if you listen to a lot of music and different types of music there is no match to Spotify.

What’s deezer’s standing in all this?

They fill in the gap spotify will leave. The french win anyways

The CEO of Deezer does not seem to count the tax as a win.

> Deezer CEO Jeronimo Folgueira called the tax “the worst possible outcome of all the different scenarios” the company faced from the French government. “Adding taxes is the worst way of trying to support the industry,” he told Billboard.

https://www.billboard.com/pro/deezer-stock-down-france-tax-s...

isn't this similar to what Canada was/is trying to do to podcasts?

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