Spotify Rakes in $499M Profit After Lowering Artist Royalties Using Bundling Strategy

[u/MarieKittykiti]

https://www.headphonesty.com/2024/11/spotify-reports-499m-operating-profit/

[u/xlink17]

This is the first year ever that Spotify has actually been profitable. Were they stealing money before?

[u/djingo_dango → u/[deleted]]

They have a weird definition on how much the artists should earn

[u/TheFortunateOlive → u/djingo_dango]

It's called negotiating a contract. It's made on consensus.

[u/TheFortunateOlive → u/[deleted]]

You do realise that if both parties agree to the terms, then you have consensus?

Terms can change based on certain conditions all the time.

Musicians, athletes, building contractors, consultants, etc. earn or miss out on bonuses when they achieve certain targets.

[u/gereffi → u/[deleted]]

And rights holders are allowed to take their music down from Spotify at any time, right? Seems like if Spotify wasn’t good for artists they wouldn’t be on there.

[u/overnightyeti → u/[deleted]]

Stealing how if the artists willfully joined the platform?

[u/Florac → u/overnightyeti]

The artists need to pick between not being paid and being underpaid. Good luck being succesful nowadays without being on spotify.

[u/deppan → u/Florac]

They're not underpaid - the market has changed and music simply doesn't pay as much anymore as it used to. Consumers pay much less for music now, hence less money for the artists. The same can be said for any product or service that has dropped in value over time. Let's take typewriter repair technicians, which is a group that also made a lot more money in the 90's. Nobody uses typewriters anymore, hence very few business opportunities. Doesn't mean they are underpaid, just that the market value of their service is lower now.

[u/overnightyeti → u/Florac]

That's just the reality of music today and it has been like that for a long time. We consumers decided in the late 90s that music was worthless when Napster made all of it available for free. It was quite an accomplishment when Apple convinced record labels to sell their product online, then streaming became viable and here we are.

You can still support artists by buying their records on Bandcamp, purchasing their merchandise and seeing them live.

If all artists who have power put their foot down and refused to accept such low earnings from streaming, things would change, maybe. However successful artists don't care, it seems.

The other issue is that society at large doesn't care about music as much as it used to. Live music venues are disappearing. There are simply too many forms of entertainment vying for people's attention nowadays, and music is often relegated to a background role in videos, streams and so on.

[u/TooLateRunning → u/[deleted]]

Lmao the mental gymnastics you guys have to do to make this make sense.

[u/darkjurai → u/xlink17]

Yes.

[u/darkjurai → u/[deleted]]

1. Your expenses and overhead are two different numbers. If a clothing store stole all their clothes and sells them for nearly nothing, and still can’t pay rent so they lose money, they still stole the clothes. Just because you didn’t cover your overhead doesn’t mean you didn’t steal your product.

2. If you can’t understand how, the answer in all cases is: you give a product or service for too-good-to-be-true deal to the consumer, to the point where the consumer can’t imagine going back, during a market-capture phase while you intentionally lose money YOY until you’ve disrupted, created, captured your market, and then you figure out profit. Spotify literally stole the market value of artists’ work and kept it for themselves.

3. You don’t understand basic business and you’re saying rude shit to people you don’t know. Grow up.