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Comment by bko | Hacker News Reader

Call me naive, but can't an artist just refuse to be listed on Spotify? No meetings, groups, boycotts necessary. If an artist feels like the payout isn't high enough, they can just exclude their catalog from the app. And if they don't own their own catalog, then that's a decision they made knowingly and they gave up their right to control where it gets hosted. If they got exploited or didn't know, then they should take it up with their agent, whoever was advising them or the person that owns the rights. They can also try to buy their rights back. Has nothing to do w/ Spotify.

This anger against Spotify and other streaming services just strikes me as misdirected. Spotify pays out ~70% of its revenue to music rights holders, which strikes me as reasonable, although I have nothing really to base this on. But I feel like the people behind this kind of movement expect a much bigger payout, so even if Spotify paid out 100% of their revenue to rights holders, they would still think its too low.

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2 things:

1. Saying "hey, you can just not list on Spotify" is naive. Unless you're a major artist, you don't have the market power to convince people not to use Spotify. Essentially every labor movement is about pooling the collective power of individuals to fight larger entrenched market owners, and that's what this boycott is about.

2. To me the main issue is not the payout percentage, but how it's divvied up. I believe this is still the case, but payouts are divvied up by averaging across all plays. But the total plays are dominated by large artists. A better deal for smaller artists is to allocate each individual subscriber's revenue based on what that subscriber listens to. For example, if I love Obscure Artist A, and 90% of my songs are Obscure Artist A, then Obscure Artist A should get 90% of my $15 or whatever subscription fee (minus Spotify's cut). But instead, Spotify says "Obscure Artist A only had .000001% of total plays, so they only get .000001% of total revenue" - it ends up being a better payout for the big names but a worse deal for all the smaller artists.

So someone needs to make a substack for music basically. That's what we are talking about here. Question is, do people think a certain artist or song is important enough to pay $5/month to individually? My sense is no, but perhaps...

> someone needs to make a substack for music basically

Isn’t this Bandcamp?

It is. And it’s also the fairest platform for musicians pay-wise. Though Epic apparently acquired Bandcamp[1] recently (presumably to stuff its IP catalogue for Fortnite Festival, so who knows how long that will be true for.

[1] https://pitchfork.com/news/epic-games-sells-bandcamp-amid-la...

> Though Epic apparently acquired Bandcamp[1] recently

The article you linked is about Epic selling Bandcamp, which happened relatively quickly after they acquired it. I guess they didn't find any use for it in the end.

>Question is, do people think a certain artist or song is important enough to pay $5/month to individually? My sense is no, but perhaps...

Abso-fucking-lutely! I pay $3.50 a month to listen to a madman with a mohawk rant about Formula 1. I doubt there's anyone who wouldn't pay their favorite artists $5 a month. On the flip side I would get to listen to three artists and every other artist would lose me as a listener. I don't feel anybody wins in that scenario.

There was a study that looked at the economics of this [1]: user centric (UCPS) vs market centric (MCPS) payment system. In short: UCPS would transfer some revenue from the top artists to the middle rump of popular artists, but the small and obscure artists would not be affected much since they hardly make much in the first place.

My take on this: of course the top artists should not be taking a disproportionate cut at the expense of the less popular artists, a UCPS is not a panacea but it would be an improvement.

[1] https://legrandnetwork.blogspot.com/2021/02/user-centric-mod...

I think the real issue that needs to be solved for this is how you will convince big artists to sign while giving up some revenue to less popular artists ... because you absolutely need them.

Thanks so much for linking this, I think it's a great study.

And I agree, I don't think it would be a panacea. But I think it would be a lot fairer, and would help a large selection of artists in that middle tier. For the most obscure artists, while the study says it has a "low impact" on them, they actually had the highest percentage increase, but since their royalties are already so low the euro amount increase was in the single digit euros. And again, that seems fair to me - if hardly anyone is listening to you, you're not going to be getting a big payout.

> For example, if I love Obscure Artist A, and 90% of my songs are Obscure Artist A, then Obscure Artist A should get 90% of my $15 or whatever subscription fee (minus Spotify's cut). But instead, Spotify says "Obscure Artist A only had .000001% of total plays, so they only get .000001% of total revenue" - it ends up being a better payout for the big names but a worse deal for all the smaller artists.

Why would the former pay obscure artists more? Are non-paying users more likely to listen to mainstream artists? Or do fans of obscure artists just play fewer songs each? Is ad revenue shared in the same proportions, but just lower per user? Is revenue really shared on the basis of plays, rather then playing time? If so, and if obscure artists make longer songs, does that contribute to their lack of revenue?

It seems like if anything the current model would end up paying obscure artists more? (If you assume that people who listen to obscure music tend to listen to more music overall, which would be my guess.)

> Why would the former pay obscure artists more?

I don't want the obscure artists to get more ― or less, for that matter. I want the artists I listen to to get my money, obscure or not. That's a simple transaction and has worked forever. If I buy a CD from artist X, I know I won't be supporting artist Y with my money, just X. If I then want to listen to Y, I can support them as well. But in any case Z won't be getting any of my money because they make noises I don't consider music.

> If I buy a CD from artist X, I know I won't be supporting artist Y with my money, just X.

That's not entirely true, since by buying X's CD you're also giving money to the label/publisher of that CD, who may be allocating that money to Y if Y is also one of their artists. However, overall I agree that the buy-a-CD model makes it more clear where your money is going.

Money is fungible. Where “your” money went means nothing, just what the final payout the artist got at the end of the month.

It doesn’t seem obvious that smaller artists have audiences who stream music less than listeners to Taylor swift. Because that’s the only way the current system might rip people off.

> Why would the former pay obscure artists more?

A sibling commenter linked a great study:

https://legrandnetwork.blogspot.com/2021/02/user-centric-mod...

Because they make less.

I just want to understand this a bit more clearly.

So I have never even opened Swift’s page on Spotify — let alone played a song (if there are fans here, please don’t come after me). I pay for Spotify. So did you mean to say the largest portion of my monthly fee goes to Taylor Swift?

That is correct.

The difference is:

1. Put all money in a big pot and pay out depending on all streams.

2. Put your money in a pot and pay out depending on your streams. Do the same for all users.

The total sum of money stays the same. If your audience listens to more music than the average Spotifier then you will get paid less using method 2.

All in all the difference isn’t massive.

No, you pay Spotify, and then Spotify pays artists per stream they received. “Your” money goes in to a pool at Spotify where it can’t really be traced further.

If you listen to more music than the average listener, those artists get paid out more than what you put in, and if you listen to less, they get less. But on average it all levels out anyway.

Unless people who listen to a particular artist on average stream less music entirely. Which doesn’t seem to be the case.

You said "no" but your explanation says yes

It doesn’t though. There is no transaction between you and Taylor Swift.

If you listened to less music than the average person then some of your fee went to the people who listened to more music, and the other way round if you listened to more music. Which is going to average out in the end anyway, while massively simplifying the accounting. Spotify can also tell artists exactly how much they are getting paid rather than having to wait for the end of the billing period to work it out. Only to come to roughly the same amount anyway.

There is no tracing routes with a pooled fund. Only inputs and outputs. And the outputs would seem to be pretty much identical in the pooled system vs individual pools per user.

Ok so still yes taylor swift is indirectly or whatever getting some of your money

In the same way that your small time artist is getting some of Taylor swift fans money. In the end the artists still get paid the same under either system.

But they do not get payed the same. Let's say Spotify has two users that total 100 listens, 99 Taylor listens and one listen for the obscur artist.

If payed by total listens Taylor gets 99%.

Now if those 99 listens are from the one user and the other from the other user. Paying by listens ratio per user, Taylor will get 50%.

That only matters if as a whole Taylor swift listeners listen to Spotify for longer than obscure artist listeners. Which hasn’t been shown.

Over the entire population of Spotify listeners you are going to have high and low listen count users that average out.

No, it was shown this doesn't average out, there is a study linked upthread.

The obtuseness of your responses is incredible. Can you not even concede anything?

The money you pay doesn't have an identity attached to it so Spotify has to just pool the money and pay out. But if it helps, you can think of it the way you stated, zero of your money goes to Taylor Swift. It works out that way.

The only difference is that you bet that your audience listens to less music than the average Spotify user.

Some will make less. Some will make more. In the end the pie stays the same: ~70% of Spotify’s revenue.

That revenue model makes no sense. How would paying an artist on the relative user plays make any sense? So basically there is no direct relationship with number of plays and revenue? You need to abstract that part out. Artists should be paid some amount per stream.

Is there a market that actually uses a system like that? It just seems convoluted. It sounds like just some idea someone made up to back into paying some artists more in favor of others. And I'm not even sure it would have the desired effects. I'm sure Swift is on a lot more playlists that Spotify pushes than Obscure Artist.

It makes sense because each user is paying. I would like the my personal payment to Spotify to be split between the musicians I listen to, and none of it to go to Taylor Swift.

Yes, it wouldn't be a direct relationship between number of plays and payout. It would instead be a direct relationship between user payment and payout.

>Is there a market that actually uses a system like that?

Yes, physical media.

Number of streams shouldn't necessarily be directly related to payout anyway. If you purchase a CD the artist gets that payment once, and you can listen to it as many times as you like.

I don't understand the argument about paying all artists a fixed amount per stream when customers aren't paying a fixed amount per stream in an unlimited subscription model. If I listen to artists X, Y and Z, it makes a lot more sense to me that the only people who get paid from my subscription money are artists X, Y and Z. As opposed to the situation we have now, where, as a sibling comment points out, if I never listen to Taylor Swift the largest portion of my subscription fee still goes to her.

On a very very large average, and assuming that Spotify pays out now in precise proportion to the total plays (just as you wrote - if 0.1% of plays, then 0.1% of payouts), then changing to your proposed system would literally change nothing. Average number of plays in total versus average number of users listening to an artist would be exactly the same statistically, starting from several tens of thousands of users, and Spotify has millions of them.

> then changing to your proposed system would literally change nothing.

That's simply wrong. Another commenter posted a study that looked at exactly this question, https://legrandnetwork.blogspot.com/2021/02/user-centric-mod... . It's not an enormous change, but on Spotify the top 10 artists would have their income reduced 12.5%, to be redistributed to lower tier artists.

I mean, the article is likely correct, but only if the current distribution of royalties in Spotify isn't proportional to the play count (which was presumed in the top comment). And it is totally believable that Spotify adjusts them to entice bigger names to the platform.

But if the distribution would have been equal, then there will ne zero difference with the user based distribution. Because it would be the exact same number counted differently.

User A listens to artists 1, 2, 3 in a 50%, 25%, 25% proportion on a 15$ sub (same below)

User B listens to artists 1, 2, 4

User C listens to artists 4, 5, 6

So by current system, artist 1 has 4 plays, 2 has 2 plays, 4 has 3 plays, 3 and 5 and 6 have 1 play. So 1 gets 15$, 2 gets 7.5$, 4 gets 11.25$, and 3,5,6 all get 3.75$

If we recalculate to the per user scheme, then from user A, 1 gets 7.5$, 2,3 get 3.75$. From B, 1 gets 7.5$, 2,4 get 3.75$. And from C, 4 gets 7.5$, 5, get 3.75$. Sum it up and we get 1 get 15$, 2 gets 7.5$, 4 gets 11.25$, 3,5,6 get 3.75$.

It's very basic arithmetic, from shuffling numbers and then summing them up differently, the total won't change.

So what needs to be changed is a skew artificially made towards big names, that is the real root cause.

user-centric (pay for what people listen to) is explicitly not proportional to play count. that's why your arithmetic does not work.

to make it simple

-----

userA: 999 plays of artist A: pays 5$

userB: 1 play of artist B: pays 5$

pool-centric: A gets 9.99$, B gets 0.01$

user-centric: A gets 5$, B gets 5$

-----

bonus: in spotify system artists under a certain threshold get 0$. which gives guaranteed distortions even if you suggest ideal conditions for the pool/user thing up there to not matter (independence and large numbers).

extra bonus: spotify also dilute the pool by running mass music production sweat shops aaaaand by running more and more AI music for which they run the money back to themselves.

in practice small artists lose money on spotify, and a significant section of spotify artists would earn more selling a few cds a year on bandcamp than on their spotify ever.

it's a scam.

You should really double check your "very basic arithmetic", because it's wrong. If a user listens to fewer total songs than the average Spotify user, then the artists they listen to will get a larger payout under a per-user model compared to an aggregated model, and the study I linked shows that this results in the top 10 artists earning ~12% less, which causes a larger distribution to smaller artists.

If only it was that simple. Record labels own the whole pipeline and you're unlikely to make it if you don't submit to signing away your rights and the majority of your royalties [1]. Even the best selling artist on the entire planet at one point (Taylor Swift) had to put up a fight to regain control of her records [2].

Even if they could pull their music from the platform, it's like shooting yourself in the foot. You lose most of the exposure that will lead to actual revenue: physical albums and show tickets.

[1] https://informationisbeautiful.net/2010/how-much-do-music-ar...

[2] https://en.wikipedia.org/wiki/Taylor_Swift_masters_dispute

In edm most large artists now just have their own label. It’s easier than ever to do. Even a single individual can do it easily. There are a lot of decent distribution services that will get your music on all the services.

I’m sure the big labels are still valuable for advertising but after you’ve grown enough I can’t understand why you wouldn’t just have your own label.

> after you’ve grown enough

In the mainstream music industry you can’t grow without being signed, so it's a bit of a catch-22.

Even artists known as "independent", like Billie Eilish, only have their big breakthrough after signing a deal that gives them access to producers, funding for music videos, radio shows, publicists, interviews, concerts, etc.. having access to streaming/publishing is only 10% of the deal.

"The goal, in short, was “down with algorithmic listening, down with royalty theft, down with AI-generated music”."

In the article they do mention Massive Attack, King Gizzard & the Lizard Wizard, Deerhoof and Hotline TNT delisting their music and then further speaking out in protest- removal being 1/3 parts of the listed "goal".

But really it seems like the discourse on Spotify is making waves again with the recent reveal of Ek's Helsing investment. Given this is the same dude who said that "the cost of making content is close to zero", it's understandable that people are speaking out.

Spotify in the UK has all the Massive Attack albums I remember, so doesn't seem like they tried very hard to "pull" them.

Never heard of the others, but only King Gizzard & the Lizard Wizard seems to be totally gone.

If an artist has full control of their IP, yes they can just take their music down.

Dissatisfaction with the payout is only one aspect of why some artists are leaving Spotify. I personally find it super weird how much Spotify profit is getting funnelled into arm manufacturing. Like why should listening to music help new AI drone tech to get developed? Tf?

Is it? Sounds to me like it's the Spotify's owner, not Spotify, that's plowing his money into military spending regardless of the source.

Because people who recognize a good investment see both Spotify and arms as good investments.

Assuming you pay taxes, your money is probably being funneled to arms manufacturing anyway.

Spotify's profit is not being funneled into arms manufacturing though, only by stretching that the money Daniel Ek made by being the founder of Spotify is "Spotify's profits" which he then used to make an investment into Helsing. Even though Spotify wasn't profitable at all for most of the almost ~20 years of existence.

>Call me naive, but can't an artist just refuse to be listed on Spotify? No meetings, groups, boycotts necessary.

They want the listeners to change their habits away from Spotify and engage with music differently -- on another platform -- e.g. maybe like Bandcamp. The listeners would discover music at Bandcamp and make purchases there where the artists get more money.

But only a minority of hardcore fans will buy music à la carte like that. Most other mainstream listeners would prefer to have ~100 million songs for a flat monthly subscrption. The tiny 0.04 cents per stream is not a concern of the subscribers. That's why it's an uphill battle.

Seems that it may be at least partially a discounted cash flows/time value of money and a risk shifting issue for the artist.

Nothing has really changed in this regard. When I was younger, most people didn't have huge collections of tapes or CDs, most just turned on the radio and had one or two CDs that they really only listened to one song of. Spotify giving _any_ money to artists improves this scheme (not to make a judgement on "fair").

The vast majority of music listeners aren't music collectors. Those people mostly want to listen to what others are listening to in order to share something in common. It's a very different approach to music than the collector who's looking for new music they've never heard of.

Artists typically fall into the latter category and want everyone else to also. They fail to understand that music, for most people, is a cultural touchstone, not a hobby.

The radio stations paid royalties to licensing pools who presumably funneled some of the money to the artists.

It's not naive, it's literally what the artists did in the article.

The trade you make is reach, you can't benefit from being discovered on Spotify, it's harder for prospective fans to become fans when they can't listen to your music. You could upload your music to other places but they seem to largely be against "uploading it online and giving it away for free."

> Call me naive, but can't an artist just refuse to be listed on Spotify? No meetings, groups, boycotts necessary. If an artist feels like the payout isn't high enough, they can just exclude their catalog from the app.

Actually no. Or at least not completely. Radio-style play has mechanical licensing with statuatory royalties. Users wouldn't be able to request specific songs, but they could request a similar songs or similar artists station and likely hear your music.

This is indeed naive. Spotify is part of any contract an artist signs with distributors. They will simply not work with an artist if they don’t agree to it, because their business model is based on it.

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