Streaming giant Spotify has come under fire from artists and other sections of the music industry, as a result of cutting royalty payments by 30% when artists opt-in to its Discovery Mode feature. In detail, Spotify will cut royalty payments on these streams in exchange for the exposure they gain through its Discovery mode playlist. Artists must decide if they should pay up or take the risk and potentially lose out on plays.
Public Response to Spotify’s take
The war on streaming platforms taking money from artists is an ongoing problem, and Spotify just stirred the pot. Many have already taken to social media to express their disgust.
Universal Music Group chairman/CEO Lucian Grainge is ready to move on with a new “Updated Model” of online music streaming. He says this about change in the UMG new years memo:
“absolutely essential to promote a healthier, more competitive music ecosystem, one in which great music, no matter where it’s from, is easily and clearly accessible for fans to discover and enjoy. An environment where great music is not drowned in an ocean of noise. And one where the creators of all music content, whether in the form of audio or short-form video are fairly compensated.”
Lucian Grainge
During this memo, UMG claimed to be working with Tidal and Deezer streaming platforms to develop “an innovative new economic model for music streaming”. Spotify was not listed as a partner.
Between artists and record labels, everyone is hesitant to keep paying more money to streaming platforms and their algorithms, even if it is for a few extra listeners.
What is Spotify’s Discovery Mode?
Spotify’s Discovery Mode feature promotes new music while increasing artist visibility and engagement. It allows users to stream new music, and it curates playlists highlighting user tastes. This gives listeners more exposure and control over their listening experience and helps encourage the discovery of new music. Now, if an artist opts into this mode, they will get less money per stream and potentially more exposure to potential fans.
The Benefits of Opting In
Opting into Discovery Mode provides numerous benefits for artists. First, it can increase an artist’s fan base by putting them in front of potential new listeners. Second, it encourages people to listen more deeply to songs and albums instead of just playing individual tracks on shuffle. This more profound listening can lead to increased engagement with fans. Also, easier access to their other bases of communication that could help build a stronger connection with them. Finally, opting into Discovery Mode can also open doors for collaborations. Because artists can be discovered by other creators through this platform, leading to more opportunities down the road.
The Drawbacks of Opting In
On the other hand, there are some drawbacks to opting into this feature. First, artists will receive lower royalties per stream due to the decreased payouts from this mode. This could strain their income if they rely heavily on streaming services for revenue. Second, opting into this mode does not guarantee increased visibility or engagement. Because it is still subject to algorithmic selection – meaning even if you are featured in Spotify’s curated playlists, your music might still go unnoticed due to factors outside your control such as timing or user preferences at any given moment. Finally, opting in means giving up some level of control over how your music is presented. Because you won’t be able to tailor it specifically towards certain audiences.
Conclusion
Whether or not an artist should opt into Spotify’s Discovery Mode ultimately depends on their goals and priorities as a musician. The Spotify 30% might be worth the extra listener for a new artist. Taking advantage of features like these can help increase visibility and engagement with fans while also providing more opportunities down the line. This makes it something worth considering for any serious musician looking for ways to further their career from streaming services without sacrificing too much creative control over their work.
