Spotify CEO speaks out on Taylor Swift albums removal: 'I'm really frustrated'

Daniel Ek defends free streaming: ‘Here’s the key fact: more than 80% of our subscribers started as free users’

Spotify chief executive Daniel Ek has responded to Taylor Swift’s decision to remove her albums from the streaming service with a blog post tackling what he describes as the “myths” of streaming music.

“We started Spotify because we love music and piracy was killing it. So all the talk swirling around lately about how Spotify is making money on the backs of artists upsets me big time,” wrote Ek.

In his post, Ek announced that Spotify now has 50 million active users, with 12.5 million of them paying for a monthly subscription. That’s up from 40 million and 10 million respectively in May 2014. He added that Spotify has now paid out more than $2bn in royalties to labels and publishers.

“A billion dollars from the time we started Spotify in 2008 to last year and another billion dollars since then. And that’s two billion dollars’ worth of listening that would have happened with zero or little compensation to artists and songwriters through piracy or practically equivalent services if there was no Spotify,” wrote Ek.

“When I hear stories about artists and songwriters who say they’ve seen little or no money from streaming and are naturally angry and frustrated, I’m really frustrated too. The music industry is changing – and we’re proud of our part in that change – but lots of problems that have plagued the industry since its inception continue to exist.”

Ek trained his sights on a lack of transparency within the music industry, referring to the $2bn payouts figure.

“If that money is not flowing to the creative community in a timely and transparent way, that’s a big problem. We will do anything we can to work with the industry to increase transparency, improve speed of payments, and give artists the opportunity to promote themselves and connect with fans,” he wrote.

Ek also defended Spotify’s “blend” of free and subscription music, with Swift having removed her albums because the company refused to only make them available to its paying subscribers.

“Our free service drives our paid service,” he wrote. “Here’s the key fact: more than 80% of our subscribers started as free users. If you take away only one thing, it should be this: No free, no paid, no two billion dollars.”

Ek also claimed that a top artist like Taylor Swift can expect to earn $6m a year from Spotify streams; criticised YouTube and SoundCloud for their lack of payments to artists for every stream on their services; and cited the likes of Ed Sheeran, Ariana Grande, Calvin Harris and Daft Punk as examples of artists who have sold lots of albums without windowing their releases from Spotify.

“Here’s the thing I really want artists to understand: Our interests are totally aligned with yours. Even if you don’t believe that’s our goal, look at our business. Our whole business is to maximize the value of your music. We don’t use music to drive sales of hardware or software. We use music to get people to pay for music,” he wrote.

“We’re getting fans to pay for music again. We’re connecting artists to fans they would never have otherwise found, and we’re paying them for every single listen. We’re not just streaming, we’re mainstreaming now, and that’s good for music makers and music lovers around the world.”

Ek’s blog post means we have now heard from all the main parties involved in the Taylor Swift removal, as well as from some interested observers.

Swift gave her views in an interview with Yahoo:

“Everything new, like Spotify, all feels to me a bit like a grand experiment. And I’m not willing to contribute my life’s work to an experiment that I don’t feel fairly compensates the writers, producers, artists, and creators of this music. And I just don’t agree with perpetuating the perception that music has no value and should be free...

“I try to stay really open-minded about things, because I do think it’s important to be a part of progress. But I think it’s really still up for debate whether this is actual progress, or whether this is taking the word “music” out of the music industry.”

Scott Borchetta, who runs Swift’s label Big Machine Label Group, also had his say in a radio interview, as reported by Billboard:

“We determined that her fan base is so in on her, let’s pull everything off of Spotify, and any other service that doesn’t offer a premium service. Now if you are a premium subscriber to Beats or Rdio or any of the other services that don’t offer just a free-only, then you will find her catalogue...

I’ve had calls from so many other managers and artists. There’s a big fist in the air about this. Spotify is a really good service, they just need to be a better partner and there is a lot of support for this.”

Adele’s manager Jonathan Dickins addressed the issue during his appearance at the Web Summit conference in Dublin last week:

“The premium tier to me are real active record buyers, paying their $9.99 or €9.99 or £9.99 a month. My feeling would be to get around the situation with someone like Taylor Swift – but Spotify won’t do it – is a window between making something available on the premium service, earlier than it’s made available on the free service.”

Anthony Bay, CEO of Spotify rival Rdio, also pointed to this split between what’s available to stream for free, and for paying subscribers, at the same conference:

“It was saying she didn’t think her music should be free. She doesn’t want her music played on an unlimited, on-demand free service with ads. It wasn’t anti-streaming: it was anti that type of streaming...

The fundamental thing here is it’s art. It’s the artist’s choice. It needs to be the artist’s decision as much as possible. In this case, if the artist said ‘I don’t want my music to be played for free, then you have to respect that.”

And finally U2 frontman Bono – no stranger to digital music controversy at the moment – gave his opinion at Web Summit:

“The real enemy, the real fight is between opacity and transparency. The music business has historically involved itself in quite considerable deceit...

When people pick on Spotify: Spotify are giving up 70% of all their revenues to rights owners. It’s just that people don’t know where the money is because the record labels haven’t been transparent.”

As things stand, Swift’s back catalogue remains unavailable on Spotify, but available on the premium tiers of its rivals – as well as for sale on Apple’s iTunes and other download stores.

Ek’s blog post gave no indication on whether Spotify will be changing its policy of insisting every album is available on both its free and paid tiers. An equally important question looming, though, is whether Swift’s music will be available on YouTube’s upcoming “Music Key” streaming service.

It is expected to have a similar mix of free and paid tiers to Spotify, and according to one leaked contract earlier in the year, may require labels to make their entire catalogues available at both levels.

Bandcamp to help musicians launch their own subscription services

Streaming music: what next for Apple, YouTube and Spotify?

Spotify v Artists: 10 things to read to understand the debate


Stuart Dredge

The GuardianTramp

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