Spotify Reports First Full-Year Profit

The Wall Street Journal:

Spotify Technology reported its first ever full year of profitability, fueled by record user growth and austerity measures after years of heavy spending on growth initiatives such as podcasts.

Its fourth-quarter earnings are a sign that the company has been able to wean itself off years of intense investment and transform from a music-streaming service with tough margins to a full-service audio company. 

Shares in the company rose 10%, and are up about 29% on the year. 

“It only took 18 years for us to get here, but we’re here,” Chief Executive Daniel Ek said in an interview.

Report: Spotify Filling Playlists with Ghost Artists to Minimize Royalty Costs

Liz Pelly, writing for Harper’s Magazine:

For more than a year, I devoted myself to answering these questions. I spoke with former employees, reviewed internal Spotify records and company Slack messages, and interviewed and corresponded with numerous musicians. What I uncovered was an elaborate internal program. Spotify, I discovered, not only has partnerships with a web of production companies, which, as one former employee put it, provide Spotify with “music we benefited from financially,” but also a team of employees working to seed these tracks on playlists across the platform. In doing so, they are effectively working to grow the percentage of total streams of music that is cheaper for the platform. The program’s name: Perfect Fit Content (PFC). The PFC program raises troubling prospects for working musicians. Some face the possibility of losing out on crucial income by having their tracks passed over for playlist placement or replaced in favor of PFC; others, who record PFC music themselves, must often give up control of certain royalty rights that, if a track becomes popular, could be highly lucrative. But it also raises worrying questions for all of us who listen to music. It puts forth an image of a future in which—as streaming services push music further into the background, and normalize anonymous, low-cost playlist filler—the relationship between listener and artist might be severed completely.

And:

Another former playlist editor told me that employees were concerned that the company wasn’t being transparent with users about the origin of this material. Still another former editor told me that he didn’t know where the music was coming from, though he was aware that adding it to his playlists was important for the company. “Maybe I should have asked more questions,” he told me, “but I was just kind of like, ‘Okay, how do I mix this music with artists that I like and not have them stand out?’ ”

Some Users Disappointed with Spotify Wrapped

Sarah Perez, writing for TechCrunch:

Chief among the complaints are that Spotify prioritized the inclusion of an AI podcast for Wrapped over the other, clever and creative data stories that it typically offers — like those that identify your music personality, match you to a town that shares your musical tastes, describe your “audio aura,” or turn your listening history into a game you can share with friends, among other things. Others are upset over the lack of more detailed stats and the exclusion of information they’ve come to expect, like top music genres and top podcasts. Spotify declined to clarify how they decided which features to include.

Spotify Wrapped & Apple Music Replay Now Live

Spotify’s Wrapped is now live, as is Apple Music’s version called Replay. As a longtime Last.fm user and evangelist it’s always interesting to see how these stats compare to my extremely diligent scrobbling. Apple Music got my “most played song” completely wrong. But I do find these “top artist/albums” by month graphics pretty cool (but, still not correct when compared to what I scrobbled). I shared my stats below, and I’ll post the actual numbers after the year’s over in our end of the year feature.

Read More “Spotify Wrapped & Apple Music Replay Now Live”

Fake AI Albums Flooding Spotify

Elizabeth Lopatto, writing at The Verge:

To understand how this works, you need a sense of the mechanics. Streaming platforms like Spotify don’t work like your Facebook page — Mena and other artists aren’t logging in and adding albums to their accounts directly. Instead, they go through a distributor that handles licensing, metadata, and royalty payments. Distributors send songs and metadata in bulk to the streaming services. The metadata part is important; it includes things such as the song title and artist name but also other information, such as the songwriter, record label, and so on. This is crucial for artists (and others) to get paid. 

But this whole process effectively works on the honor system.

And:

“It was super weird,” says Marcos Mena, Standards’ lead songwriter and guitarist. “I thought, ‘Oh, this is something Spotify will take care of.’” After all, Standards has a verified artist page. But when a fake album was posted on September 26th, it didn’t budge. Mena emailed Spotify to tell them there’d been a mistake. The streamer responded two weeks later, on October 8th: “It looks like the content is mapped correctly to the artist’s page. If you require further assistance, please contact your music provider. Please do not reply to this message.” As of November 8th, the fake Standards album was still right there under the band’s verified, blue-checked name. It was finally removed by November 11th.

Cool, I definitely don’t see this continuing to be a massive problem.

Lily Allen Earns More Money From Feet Pics That Spotify

Money

Lilly Allen revealed that she makes more money per year posting pictures of her feet on OnlyFans than she does from Spotify streaming royalties:

{T]he 39-year-old singer-songwriter said on X Friday (Oct. 25) that her side business has been more lucrative than the streams she earns on one of the world’s biggest music platforms. “imagine being and artist and having nearly 8 million monthly listeners on spotify but earning more money from having 1000 people subscribe to pictures of your feet,” she wrote.

Allen’s remark came in response to someone who’d negatively commented on a post advertising her OnlyFans account. “Imagine being one of the biggest pop stars/musicians in Europe and then being reduced to this,” the fan wrote, to which the “Smile” singer added: “don’t hate the player, hate the game.”

Spotify to Launch New Premium Plan

Bloomberg:

Spotify Technology SA will introduce a new, higher-priced premium plan for its most ardent users later this year, according to a person familiar with the plan. Users will be charged at least $5 more per month for access to better audio and new tools for creating playlists and managing their song libraries, said the person.

Spotify Announces New Price Increase

Variety:

The Spotify Premium Individual plan is increasing by $1, from $10.99 to $11.99 per month, according to the company’s updated price listings. The Premium Family plan, which provides access for up to six members a household, is going up by $3, from $16.99 to $19.99 per month.

Spotify to Discontinue Car Thing

The Verge:

Spotify’s brief attempt at being a hardware company wasn’t all that successful: the company stopped producing its Car Thing dashboard accessory less than a year after it went on sale to the public. And now, two years later, the device is about to be rendered completely inoperable. Customers who bought the Car Thing are receiving emails warning that it will stop working altogether as of December 9th.

Unfortunately for those owners, Spotify isn’t offering any kind of subscription credit or automatic refund for the device — nor is the company open-sourcing it. Rather, it’s just canning the project and telling people to (responsibly) dispose of Car Thing.

Spotify’s New Royalty Model to Pay Songwriters Less

Kristin Robinson, writing at Billboard:

When Bloomberg reported that Spotify would be upping the cost of its premium subscription from $9.99 to $10.99, and including 15 hours of audiobooks per month in the U.S., the change sounded like a win for songwriters and publishers. Higher subscription prices typically equate to a bump in U.S. mechanical royalties — but not this time. 

By adding audiobooks into Spotify’s premium tier, the streaming service now claims it qualifies to pay a discounted “bundle” rate to songwriters for premium streams, given Spotify now has to pay licensing for both books and music from the same price tag — which will only be a dollar higher than when music was the only premium offering. Additionally, Spotify will reclassify its duo and family subscription plans as bundles as well.

To determine how great this loss in royalty value would be for the music business, Billboard calculated that songwriters and publishers will earn an estimated $150 million less in U.S. mechanical royalties from premium, duo and family plans for the first 12 months that this is in effect, compared to what they would have earned if these three subscriptions were never bundled

Spotify Recommending A.I. Generated Music

Spotify has been recommending “A.I. generated music” to some users:

My favorite example of this is AI music spreading across on Spotify right now. A user on X this week spotted an Artist page called Obscurest Vinyl that was promoted by Spotify’s Discovery Weekly.

The story behind the page is interesting. Obscurest Vinyl started as a Facebook page that would photoshop fake album covers for classic records that didn’t exist. The page recently shifted into posting AI songs to go with the fake album covers. As one commenter noted, you can tell the songs are AI because most of them feature bass and drum parts that don’t repeat in any discernible pattern. The account also regularly fights with users on Instagram who gripe about it using AI. 

Look, I think songs titled things like, “I Glued My Balls To My Butthole Again” are, honestly, pretty funny, AI or not. But they’re being uploaded to Apple Music and Spotify, which is where the snake starts to eat its own tail. Popular AI music generators like Suno clearly have datasets that include at least some copyrighted material (likely a lot). Which means, in this instance, Spotify is promoting and monetizing an account using an AI likely trained on the music that’s been uploaded to their platform that they don’t actually pay enough to support the creation of. And this is happening across every corner of the web right now.

Spotify Plans New Remixing Tools

Wall Street Journal:

The audio streaming company is developing tools that would allow subscribers to speed up, mash up and otherwise edit songs from their favorite artists, according to people familiar with the discussions. It is a bet on the future of music consumption that Spotify hopes will deepen user engagement and appeal to young users, while generating new revenue for artists. 

Kinda hate this.

Spotify to Raise Prices in 2024

Bloomberg:

The streaming giant will increase prices by about $1 to $2 a month in five markets by the end of April, including the UK, Australia and Pakistan, according to people familiar with the matter. It will raise prices in the US, its largest territory, later this year, said the people, who asked not to be identified discussing confidential plans.

Matt Farley Tries to Match Every Search Term on Spotify

The New York Times

Brett Martin, writing for the New York Times:

Largely, though not entirely, on the strength of such songs, Farley has managed to achieve that most elusive of goals: a decent living creating music. In 2008, his search-engine optimization project took in $3,000; four years later, it had grown to $24,000. The introduction of Alexa and her voice-activated sistren opened up the theretofore underserved nontyping market, in particular the kind fond of shouting things like “Poop in my fingernails!” at the computer. “Poop in My Fingernails,” by the Toilet Bowl Cleaners, currently has over 4.4 million streams on Spotify alone. To date, that “band,” and the Odd Man Who Sings About Poop, Puke and Pee, have collectively brought in approximately $469,000 from various platforms. They are by far Farley’s biggest earners, but not the only ones: Papa Razzi and the Photogs has earned $41,000; the Best Birthday Song Band Ever, $38,000; the Guy Who Sings Your Name Over and Over, $80,000. Dozens of others have taken in two, three or four digits: the New Orleans Sports Band, the Chicago Sports Band, the Singing Film Critic, the Great Weather Song Person, the Paranormal Song Warrior, the Motern Media Holiday Singers, who perform 70 versions of “We Wish You a Merry Christmas,” substituting contemporary foods for figgy pudding. It adds up. Farley quit his day job in 2017.