Taylor Swift recently announced her highly publicized breakup with Spotify, the popular music-streaming platform. Not only has Swift denied Spotify streaming access to her new album, 1989, but she has also removed all her past albums from Spotify’s catalogue as well, leaving a Blank Space on over 19 million Spotify playlists. The reason?
Swift justified her actions by explaining that she doesn’t feel Spotify “fairly compensates the writers, producers, artists and creators of this music.” To that point, Spotify agrees that artists deserve recognition of their hard work. The company claims that it paid out $2 million to Swift in royalties for the past year and projects that Swift, as one of the most popular musicians in the world today, could earn over $6 million from Spotify alone. On the contrary, Scott Borchetta, CEO of Swift’s label Big Machine, claims that Swift earned less than $500,000 from Spotify streams in the U.S. for the past year.
Paul Sawers of The Next Web examined the discrepancy between the each side’s numbers and concluded that Spotify and Borchetta were talking about completely different things. Spotify’s projected amount was exactly that: an estimate. And, it is based on global outlook. The $2 million already paid out was collected from royalties of streaming by users from around the world. On the other hand, Borchetta’s cited number is more concrete and insular. His amount is what Swift has already been paid by Spotify in royalties based only on U.S. streams. In fact, Swift will earn somewhere between $280k-$390k for her single “Shake it off” alone.
Borchetta has also pointed to Spotify’s pay tiered structure as a potential source of discord. Spotify operates a model that starts with a basic “freemium” account. Then, users can choose to pay to upgrade their subscription to block ads, sync music across devices, or access playlists offline. Spotify believes this model better represents their listener’s current habits, which have evolved with the Internet. “We must compete with free to get [consumers’] attention in the first place.”
When the label requested that Swift’s music be restricted to only the paid-tiers, Spotify refused. Borchetta believes Spotify’s move could embarrass some fans. He projects, “if this fan went and purchased the record, CD, iTunes, whatever, and then their friends go: ‘Why did you pay for it? It’s free on Spotify,’ we’re being completely disrespectful to that superfan who wants to invest, who believes in their favorite artist.” He should’ve added, “Why you have to be so mean?”
Yet another facet of this estranged Lovestory is that Swift and her label have not pulled her music from other musical outlets. Spotify has outpaid iTunes by more than 13% in royalties this year. It’s also been calculated that Spotify’s royalty rates can be several times higher than radio play. Even though Spotify is arguably more lucrative, Swift’s music remains ubiquitous on radio stations around the nation. She currently holds the top spot across the music charts. The move away from Spotify has also doubled her viewership on Youtube. Her Youtube and Vevo streams garnered between 22 to 24 million daily views.
This dispute has struck up conversation among artists who take both sides. While many agree with Taylor, many others also believe their music is to be shared. The highway don’t care if the consumers pay a dollar or twenty.
But, Swift seems adamant. As things stand between them now, Taylor and Spotify are never, ever, ever getting back together 😥