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> basically subsidizing the extremely popular artists I don’t think this is right. I don’t know much about revenue distribution, but I think you’re conflating

> basically subsidizing the extremely popular artists I don’t think this is right. I don’t know much about revenue distribution, but I think you’re conflating listeners and money. The ratio between the two is not constant. And I think this was the GP’s point — the percentage of money a top artist gets is more than an indie musician gets. Why? Because they have a better contract with Spotify (and Apple, etc). (And that’s okay) So, let’s say the pop stars get 90% of the listeners. And they then get 85% of the possible revenue from those listeners. For the indie groups, they only get 50% of the revenue for their listeners (and yes, I know these numbers are wrong, but they are illustrative). Pop stars = 0.9 * 0.85 = 76.5% of subscription fees to the artist. (+ 13.5% to Spotify) Indie = 0.1 * 0.5 = 5% of subscription fees to the artists (plus 5% to Spotify) In this case — yes. The popular groups will take home a much larger piece of the total revenue. Smaller groups have 10% of the listeners, but only 5% of the total revenue (and ~6% of the total “artist” revenue (5/(76.5+5)). But if pop stars bring in more listeners, the absolute revenue for the Spotify (et al) is higher, which is all they care about. In the above scenario, Spotify would get ~73% of their revenue from the top artists. (13.5 / (13.5+5)). Which makes the difference in contracts worth it from Spotify’s point of view. But the smaller groups still get more (relatively and absolutely) than they did in the age of physical media. And they have a much larger pool of listeners that can be exposed to their music. You can be mad that smaller artists don’t have the same deal as Taylor Swift, et al. But that doesn’t mean that they should. That’s what I took from the GP post. You shouldn’t look at what is “fair” because (a) that’s not how the market works and (b) there are many ways to define “fair”. If those artists bring more listeners, then it makes sense from Spotify’s POV to cut a better deal with those artists. Instead, I’d focus on how much absolute revenue artists get. Is it more or less when compared with pre-Spotify/streaming. And can you make a living doing it? From the listener point of view - your $X/mo (£,€,etc) still goes to whomever you listen to. If you don’t listen to <insert famous artist here>, then they don’t get a fraction of your monthly fee. Does your favorite Indie band get a smaller slice of $X? Sure. But that’s still >0.

short_sells_poo 3y ago
I agree with your analysis, I just wanted to point out that this is effectively a regressive taxation. In this instance, Spotify is the state and from it's perspective, it makes sense to tax the pop stars less (as a %-age of income) than some tiny alt-nu-grunge-garage-under-over-in-out rock-jazz-house band. That's what maximizes Spotify's tax revenue. But it's still a regressive tax. The richer you are (in the Spotify ecosystem) the less of your earnings you have to give up. Whether this is fair or unfair is debatable - I suppose in a pure market economy, whatever the market agrees on is fair. But there's a massive disparity in negotiating power, which means that the small artists are naturally disadvantaged. Big popstars have a huge concentrated negotiating power. Small artists do not. It is thus less likely that they'll be able to negotiate a "fair" revenue model, whatever that might mean. Again, fairness is debatable. As a society, we decided that regressive taxation is unfair, because rich people can proportionally bear much higher taxes than poor people without impacting their lifestyle. I'm not going to go into the realities of rich people ending up paying a much lower effective tax rate due to being able to afford to optimize their taxes.

short_sells_poo 3y ago

I agree with your analysis, I just wanted to point out that this is effectively a regressive taxation. In this instance, Spotify is the state and from it's perspective, it makes sense to tax the pop stars less (as a %-age of income) than some tiny alt-nu-grunge-garage-under-over-in-out rock-jazz-house band. That's what maximizes Spotify's tax revenue. But it's still a regressive tax. The richer you are (in the Spotify ecosystem) the less of your earnings you have to give up. Whether this is fair or unfair is debatable - I suppose in a pure market economy, whatever the market agrees on is fair. But there's a massive disparity in negotiating power, which means that the small artists are naturally disadvantaged. Big popstars have a huge concentrated negotiating power. Small artists do not. It is thus less likely that they'll be able to negotiate a "fair" revenue model, whatever that might mean. Again, fairness is debatable. As a society, we decided that regressive taxation is unfair, because rich people can proportionally bear much higher taxes than poor people without impacting their lifestyle. I'm not going to go into the realities of rich people ending up paying a much lower effective tax rate due to being able to afford to optimize their taxes.