Revolutionising Music

There is no doubt that Spotify is one of the biggest platforms for streaming music world wide. Rivalled only by Bandcamp, Apple Music and Amazon Music in popularity. The platform has received both praise and criticism for the way it supports the music industry and at Advosound we thought we would explore its impact over that last 14 years.

History:

Founded in 2006, and launched in 2008, Spotify is a Swedish export that has focused on streaming music. From here the company expanded and public registration opened in the UK in 2009 and USA in 2012. Since 2012, Spotify has grown and developed to become one of the largest streaming sites in the world with over 286 million users, and supposedly a net worth of $21 billion.

How it works:

Spotify operates on freemium business model. This is a model which allows it have two types of membership options for their clientele. One of these options is a free account, supported by advertisers, and acquires money through this basis. The other is paid for premium subscription that removes adverts. Both models allow the listener to listen to any musical content on the company's library for an unlimited amount of time. There are certain restrictions on the free option, but both services essentially offer a 'free' listening experience for the user.

Despite offering a 'free' listening experience, Spotify does pay copyright and royalty payments to the owners of the music that it streams. An estimated $0.006 goes to the artist royalty and copyright payments per play. While Spotify does issue payment to artist for their music, it is a much lower figure than artist and copyright holders would receive if every single user purchased one copy of their single for the standard price of $0.99. This is where Spotify has come under criticism, with some suggesting it has devalued the music industry and made it harder for musicians to make a living off music.

Growth and the Current Market:

Spotify continues to grow with every new listener and as it grows, the company acquires smaller music streaming and blockchain companies like Soundtrap. These acquisitions help to improve and develop its abilities to offer music suggestions (based on what you have been listening to), curate topic specific playlist and, in-general, provide the best music streaming service available. Regardless, of whether Spotify is responsible for the growth of streaming or not, we now live in a world where Apple Music, Google Music and Amazon Music offer similar services (all based on the freemium model). Spotify now contends with these producers for listeners and will continue to develop the streaming industry as long as people want to stream music.

So, What do We Think?:

Spotify is now one of the leading platforms in music industry and perhaps criticism can be given for the amount of money it pays artists. Having said this, if it were to pay artist more, subscription packages would also need to increase and this could lead to a downturn in subscriptions, and ultimately the revenue that is currently received by artists. In a world where its' competitors essentially do the same, is Spotify really as bad as some sources say? Monetary aspects aside, we feel Spotify has done so much good for the music industry. Music is accessible for all and with the growth of features like Spotify for Artists, playlist like 'Discovery Weekly' and 'Genre Explorer', unsigned music is more accessible and shareable than ever. There is very much still a place for sites like Bandcamp in the music industry, but Spotify's importance, at least for this writer, cannot be underplayed. Below we have featured some articles that discuss Spotify's role in the Music Industry. What do you think? Is Spotify good, bad, a revolutionary platform or a product of the times?

Articles Discussing Spotify's Role in the Music Industry: