For a cost of nothing, unlimited music with some occasional ads, Spotify appeals to the consumer. People are able to get playlists catered to their own music taste, share music with their friends, and collaborate on playlists. With 140 million users, Spotify is currently the biggest music streaming service.
After co-founding Napster, Sean Parker helped startup Spotify, a new legal way to stream music for free. With the revenue from ads, Spotify is able to pay musicians while giving users the benefit of listening to music for free. In order to prevent lawsuits from the record industry, Spotify first negotiates a contract with record labels and decides how much the artist should get paid per stream. For example, Taylor Swift earned between $280,000 and $390,000 for her song “Shake It Off”. With the benefit of free music, the users are unknowingly helping the record industry. The record industry saw an 18% increase in revenue in 2019.
Spotify and other streaming services have changed the ways the record industry makes money. Even though artists are only paid a fraction of every stream, more artists have switched to Spotify. Spotify’s similarities towards Napster are strikingly similar, but unlike Napster, Spotify users either directly pay through a subscription or by listening to ads.
Sources:
Image From:https://www.theverge.com/2020/2/27/21155933/spotify-new-look-mobile-ios-universal-icons
https://qz.com/1110546/spotify-is-not-just-streaming-its-becoming-the-entire-music-industry/
https://www.theverge.com/2019/9/6/20852568/streaming-revenue-growth-spotify-apple-music-industry-ariana-grande-drake-taylor-swift
https://www.cnbc.com/2018/01/26/how-spotify-apple-music-can-pay-musicians-more-commentary.html
https://qz.com/1683609/how-the-music-industry-shifted-from-napster-to-spotify/
So would you say that the rise of musicians becoming more of celebrity figures rather than just musically important is because the shift in music consumption, where more attention is acquired from personality, rather than music.
ReplyDeleteThe difference between Spotify and Napster is really apparent when we learn about both. The importance of having legal counsel (or at least knowing how to do it legally) was what separates the two. In addition, Spotify makes the artists weight the pros and cons of going with traditional album sales vs spotify.
ReplyDeleteThis is so interesting. I didn't know that Sean Parker created Spotify as well as Napster. I remember a while back some writers were taking their music off Spotify because they felt that Spotify was not giving them enough compensation for their music. It's interesting how much things have changed.
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