- Former Spotify boss Jim Anderson said the platform was designed to distribute music, not pay artists.
- “I think Taylor Swift doesn’t need .00001 more a stream,” Anderson told singer Ashley Jana.
- Apple Music’s average per play rate is $0.01. On Spotify, it takes around 250 streams to make $1.
- See more stories on Insider’s business page.
A former Spotify boss who is credited with helping to create the Swedish music streaming platform said Spotify was never built to pay artists.
“Spotify was created to solve a problem,” said Jim Anderson, who also co-founded About.com, at a 2019 music industry conference in New York, according to a newly released recording of the event. “The problem was this: piracy and music distribution. The problem was to get artists’ music out there. The problem was not to pay people money.”
-Z (@djboothEIC) July 6, 2021
Anderson’s comments were recorded by singer-songwriter Ashley Jana, who didn’t share the recording until this week in fear of retribution from the music industry, according to Digital Music News.
The comments now made public follow a growing push for music streaming platforms to raise royalties, or the amount artists are paid per stream. “Artists are really broke,” Jana told Anderson at the 2019 event. “We’re not making any money off of the streams.”
Anderson used Taylor Swift, a long-time advocate for new musicians, as an example, saying she “doesn’t need” an increase in streaming royalties.
Swift has advocated for change in the music streaming industry since 2014 when she published an essay for the Wall Street Journal arguing that “music should not be free.” The same year, Swift pulled her “1989” album from Spotify.
In response to recent pressure, Spotify founder and CEO Daniel Ek launched the company initiative Loud and Clear to “shed light on the complicated economics of music streaming.”
In April, Apple Music said its streaming royalties pay double what Spotify pays, although the rate is calculated on a stream-share basis, not a per-stream basis, making the two rates difficult to accurately compare.
Ek wrote that one of Spotify’s goals is to help artists make a living by creating opportunities for more musicians to reach more listeners, saying fans ultimately determine the financial fate of musicians.
The Union of Musicians and Allied Workers (UMAW) organized international protests against Spotify this March. The company did not meet the union’s demands such as the one penny per-stream royalty rate.
-Union of Musicians and Allied Workers (@UMAW_) March 18, 2021
“The company consistently deflects blame onto others for systems it has itself built, and from which it has created its nearly $70 billion valuation,” UMAW said on Twitter this March.
In an interview with The Verge, Ek said the future of Spotify depends on multiple streams of revenue, which will then allow creators to best decide how to monetize their fan base.
“What we realized is that we’re no longer this kind of small startup from Sweden,” Ek told the Verge. “We’re in fact a very, very important platform for a lot of these audio creators.”
Spotify declined Business Insider’s request for comment.