India.Arie was already tired of the meager checks she was receiving from Spotify when Neil Young decided to bolt from the platform.
“So often, we need someone more powerful, someone people actually listen to, to open the door,” Arie said in an interview. So, “when Neil Young opened the door, I walked through, too.”
Leaving, though, proved difficult. Arie doesn’t own most of her own music. And Motown, which owns the master recordings to most of her catalogue, refuses to pull it from Spotify.
“I’m still asking. I’m going to keep asking. I’m going to find a way around it,” she said. “I want my music off Spotify.”
Other artists who pledged to leave Spotify after Young challenged the platform to choose between the rocker and Rogan found faced similar roadblocks. David Crosby, a founding member of the Byrds and Crosby, Stills & Nash, had to appeal to a top industry executive that owned the rights to most of his music first.
Spotify’s clash with Young shed a new light on the inner workings of a music industry still adapting to the demand for digital music and offered new insights into how artists are paid and the power of streaming services to act as a gatekeeper to millions of music lovers. Meanwhile, big stars — from Bruce Springsteen to John Legend — have made millions selling the rights to their music, losing control over how it’s used in the process.
But for working musicians who depend on touring to make money, the new economic realities created by the pandemic and the growing influence of streaming services can be daunting.
“It’s my hope that whatever side of the culture war, the Rogan-Neil Young thing, a person may land, that people can be sympathetic to the struggle of working artists trying to get fair pay,” said Eve 6 frontman Max Collins said.
If you want “to support your favorite artists, streaming is not the way. It’s the anti-way,” said Arie, who has sold millions of records. “Where else in the world is a person paid a fraction of a penny for their real life’s work?”
Spotify declined The Post’s request for comment for this story but has said it pays artists fairly and helps musicians.
By the time Spotify arrived in the United States in 2011, the music industry was already in upheaval. Napster, the peer-to-peer file-sharing software service that launched in 1999, had led to widespread piracy of music. To combat it, the industry began allowing consumers to purchase digital copies of songs on such platforms as Apple’s iTunes — but that business model didn’t last.
“The corporate interests that were controlling a lot of the [music] rights involved were looking at pure doom, because the download model was not paying for itself. So, they were looking for any way to increase their share of the pie,” said musician Steve Albini, who is known for producing PJ Harvey and Nirvana.
The industry turned to streaming. Because consumers don’t own the songs, money is made each time a tune is played.
Google, Apple and Amazon all launched their own platforms, and soon most music was consumed through streaming services, surpassing radio. By mid-2021, more than 500 million users subscribed to a music streaming service, to say nothing of the hundreds of millions who use free, ad-supported versions of them, according to Midia Research. Spotify emerged as the largest player with more than 400 million monthly users, more than the population of the United States.
The shift initially appeared potentially profitable for both musicians and record labels. At first, it felt like a “relief,” said Will Butler, a solo musician and core member of Arcade Fire. His band came to prominence in a pre-streaming age, bolstered by music blogs and, yes, illegal sharing of music. Still, the emerging technology seemed positive. “The fight against piracy was just so dumb,” Butler said. “It was kind of a relief to see someone that was trying to make something that just worked.”
New Zealand rock band Unknown Mortal Orchestra said Spotify “has been good for me as an independent artist,” in a tweet. Piracy stripped music of its value and, if “anything, streaming brought value back.”
The downsides, however, soon revealed themselves — and they were primarily about money. For each dollar of revenue Spotify earns, 58.5 cents go to the owner of a song’s sound recording (usually a record label), Spotify keeps 29.38 cents, 6.12 cents go to whoever owns publishing rights (usually the songwriter) and 6 cents goes to mechanical rights (often, but not always, owned by the songwriter), according to research from 2016 by Manatt, Phelps & Phillips, a professional services firm.
It takes a while, though, to reach a dollar of revenue. Artists are paid between $0.0033 and $0.0054 every time their song is played on Spotify. The average per-play rate on Apple Music is a higher $0.01.
According to Spotify’s data, 13,400 artists generated more than $50,000 and 7,800 generated more than $100,000 in recording and publishing royalties in 2020. The musician would most likely receive a fraction of that amount.
“As someone who loves music, I love being able to listen to everything all of the time,” Butler said. But the meager payouts leave him feeling as if he is consuming the very thing that is destroying him, he said, comparing using Spotify to being a “taxi driver who uses Uber.”
The payout from streaming service can be lucrative for some artists, said Sean Patrick Rhorer, who owns the music management company Distance Management, which represents artists such as Julien Baker and Quinn Christopherson.
“Streaming favors repeat listens. That means it supports the idea of creating albums, as opposed to singles,” Rhorer said. And independent artists, who are more likely to get favorable contracts, are often “in a pretty good position to be making pretty decent money.”
“It’s not perfect, but it never is,” he added. “CDs weren’t prefect. Vinyl’s not perfect. Eight-tracks weren’t perfect.”
Who profits often comes down to the contracts artists sign with record labels early in their careers. Most songs carry two distinct copyrights: one for song composition (the arrangement of the music and the lyrics) and one for the tangible sound recording of the music (known as the “master”). Most traditional pre-streaming contracts gave record labels the sound recording, while musicians retained the publishing rights.
That split means most artists don’t have full control of their music. And some major artists, from Bob Dylan to Tina Turner, have sold their music catalogues, which had soared in value amid the exponential growth of streaming services and the emergence of new platforms that use music, including TikTok and Peloton.
Young himself doesn’t own all of his own music, in part because he sold 50 percent of his catalogue to the U.K.-based investment firm Hipgnosis for a reported $150 million in 2021. When he decided to challenge Spotify, he first needed approval from the companies that controlled the licensing of his music.
The often-uneven payouts for artists and their record labels can also be traced to the early 1900s with another advancement in music technology: the player piano. Composers, including John Philip Sousa, were concerned that the self-playing piano would extinguish the need to purchase sheet music, which is how they made money. Player-piano companies argued that the player-piano rolls (the rolls of paper with holes punched out that direct the piano what to play) weren’t copies of the composers’ music, because people couldn’t read them — only machines could.
The dispute eventually led to the Copyright Act of 1909, which said that someone can use or play a song written by someone else, as long as they paid whoever owns the publishing rights a standard rate set by the government. “That law today means that if you’re a record label, you negotiate how much you get paid from a Spotify, Apple or Amazon, and they’ve done pretty well,” said David Israelite, the chief executive of the National Music Publishers’ Association. “On the songwriting side, the publishing side, you don’t negotiate a price. You don’t have a right to say no. The government sets the price, and that’s it.”
Most recently, in 2018, the Copyright Royalty Board, a panel of three judges, raised the payout rate for publisher royalties from 10.5 percent to 15.1 percent — a 44 percent increase. But Spotify, Amazon, Pandora and Google successfully appealed that decision. None of the companies returned calls and emails for comment. (Amazon founder Jeff Bezos owns The Washington Post.)
“These streaming services have increased the reach of music and certainly promoted a lot of benefit to fans and music lovers,” said Todd Dupler, the Recording Academy’s acting chief advocacy and public policy officer. “But the return for the artists and songwriters that are trying to make a living hasn’t caught up there yet.”
The transition has been difficult for some artists, particularly those who traditionally made most of their money through touring and merchandise sales, both of which have plummeted during the pandemic.
Spotify “took away half my income. And covid took away the other half,” Crosby, who has been inducted into the Rock and Roll Hall of Fame twice, said in an interview. “I’m 80 years old. I’m diabetic. I’m a transplant, so I’m immunosuppressed. That means I don’t have anything to fight covid with. It’s like I have a target painted on me. So, I haven’t dared to go out” and play shows.
“That’s why I had to sell to Irving in the first place,” he added, citing the sale of his catalogue to Irving Azoff, Azoff MSG Entertainment chief executive. “Because of them and covid.”
At some companies, music has also taken a back seat to a cheaper form of entertainment: podcasts.
Spotify has spent more than $500 million since 2019 to acquire big podcast companies such as Gimlet and the Ringer. It reportedly spent more than $100 million for “The Joe Rogan Experience” in 2020.
Unlike records, podcasts are relatively easy and cheap to produce. Rogan generally posts four to five episodes a week, each of which usually lasts at least three hours. Each episode attracts a reported 11 million listeners.
All of the Grammy-winning Arcade Fire’s major albums since their 2004 debut album “Funeral” add up to less than five hours of audio. That’s less than two of Rogan’s episodes.
“Part of their model is maintaining people’s engagement with the platform,” Albini said. “A podcast that is producing several LPs worth of recorded material a week is potentially a much more profitable relationship for Spotify than a band who might put out an album every year or so.”
Spotify chief executive Daniel Ek seemed to confirm that model last July in an interview with Music Ally. “You can’t record music once every three to four years and think that’s going to be enough,” he said. “The artists today that are making it realize that it’s about creating a continuous engagement with their fans.”
Podcasters also tend to have more control over what they produce. Last week, social commentator and “Bad Feminist” author Roxane Gay decided to take her podcast off Spotify, saying, “I don’t really need my podcast to be available on a platform that prioritizes a voice like Joe Rogan.”
She owns the show, “The Roxane Gay Agenda” and had the support of Luminary, the network that produces her show, so leaving Spotify, Gay said, took “just a couple flips of switches virtually to get the podcast off, and it happened immediately.”
For some artists, the industry upheaval has been discouraging. “You want to make music and people listen to it and they feel some emotion, or they dance to it,” Butler said. “You want that to be the reward more than the money. But there are people making billions of dollars off it, so it feels like maybe the reward could be more than that.”
Added Arie: “Music is always passively in your ears. You’re in the store, and it’s there. You get in the car, and it pours out of the radio. People don’t [consider] the human energy behind one of those songs. Every song takes multiple people to make, multiple people to promote.” But, to so many, “It’s just like air. It’s just there, so [people think] why do you need to care about who’s behind that?”
A previous version of this article incorrectly identified Sean Patrick Rhorer’s company as District Management. It is Distance Management. This article has been corrected.