When Taylor Swift pulled her music off Spotify a week ago, she deftly couched the action as a principled stand for artists against the blanket injustice of streaming music services. A lot of people have been talking about it in those terms. But that’s not what her decision was about at all.
A lot of the back and forth between Swift and Spotify has just been focused on how much money artists actually get paid by Spotify, how much of that Swift gets, and whether it’s fair. This is the conversation that naturally rises up from statements like Swift’s: “I’m not willing to contribute my life’s work to an experiment that I don’t feel fairly compensates the writers, producers, artists, and creators of this music.” Are streaming services just a horrible money-hemorrhaging fad? It implies, loudly.
It’s a conversation worth having, but it really has nothing to do with Swift. Her decision to pull her catalogue off Spotify was just a boring but shrewd business move. Her new record 1989 sold 1.28 million records in the first week it was out. If she keeps her music off Spotify, millions upon millions of people will her music instead of streaming it, and she will make buckets and buckets of money. It’s a move that works because, well, Taylor Swift is Taylor Swift.
In a Bloomberg Businessweek cover story published today, the owner of Swift’s record label, Scott Borchetta, makes the real motivations for keeping Swift’s music off Spotify perfectly clear:
“We’re not against anybody, but we’re not responsible for new business models,” Borchetta says. “If they work, fantastic, but it can’t be at the detriment of our own business. That’s what Spotify is.”
Spotify is bad business for Taylor Swift because she is popular and people will buy her new album in droves. And so she makes the totally rational decision to make the most money she possibly can. Simple as that.
It’s not that Swift’s argument about “fair compensation” is necessarily disingenuous. It’s just that the argument she makes — and the numbers she uses to make it — only applies to her as one of the most popular entertainers in the world. She commands more than Spotify can give her. But that’s not true for everybody. She doesn’t need the “experiment” because she is one of the very few people the traditional machine is still working for.
The whole conversation about Taylor Swift and Spotify assumes that Spotify is a good deal for anyone. It’s really not. Even if Spotify has paid out $US2 billion purely in royalties, most artists aren’t going to make any substantial money from streams. Spotify, and streaming music in general, is a terrible business that doesn’t make any money.
The only reason that the major record labels relented and cut deals with Spotify after years of holding out was that they really didn’t have another choice. The recording industry as we know it has been dying for more than a decade because people can steal all the music they want so easily that sales have tanked. Streaming isn’t the new mainstream, it’s just the wreckage of a sinking ship. A few boards to hold onto so maybe you survive. And if you are Taylor Swift, and have a full-fledged life raft, why stick around?
The great irony is that if Taylor Swift had stuck around she would make the kind of money other people would kill for. An avalanche of cash in Spotify money, but nothing compared to the landslide of traditional record sales that Taylor Swift can get because she is Taylor Swift.
And that’s just it. The armies of people running out to buy the new Taylor Swift album, and the money that it is bringing in, are both giant peaks that don’t reflect what’s really going on in streaming music. When you extrapolate from those peaks, you get a skewed view that really has no bearing on anything.
Spotify definitely isn’t the future of artists making real money. More likely than not, the “recording industry” as we know it will disappear, and the artists who are successful will piece together their livings from a combination of revenue streams, a small part of which will be what they can command from royalties.
Taylor Swift might be — hell, she probably is — being perfectly honest when she says she cares about fair compensation. But she’s an outlier and what’s fair for her — or at the very least what she can get by leaving Spotify — doesn’t translate well to everyone else. And to mistake Swift’s move to get the most out of her new record sales for some kind of statement about Spotify is a mistake.
Picture: AP