‘More meaningful connections’: will Spotify’s updates mean a proper payday for artists?
Since its inception, Spotify has drawn criticism for helping to turn music from a cherished commodity into a utility. Critics argue that its all-you-caneat monthly subscription doesn’t encourage long-term engagement, while its uniform, blank presentation of an artist’s catalogue reveals little of the hard work or distinct narrative behind any given release: the platform didn’t display songwriting and production credits until 2018, 12 years after launch.
Last week, Spotify announced its biggest ever interface overhaul, designed to address these issues. These updates, which are being rolled out to users in the UK in the coming weeks, include the ability for artists to add 30-second videos to their pages, target superfans with special releases, and give higher profile placement to merchandising and gig tickets. The biggest change comes in the form of a redesigned homepage featuring an endless feed of short-form videos, which looks strikingly similar to TikTok’s feed.
The changes are designed to create “deeper discovery and more meaningful connections between artists and fans”, says Tom Connaughton, MD of Spotify UK and Ireland. “Previously, you probably thought of Spotify as the best destination for listening. This evolution is about bringing the platform and Spotify to life in a deeper way.”
For artists who want to build a brand, creating a world around their music and showcasing who they are as a person is key for long-term engagement with fans. This has scarcely been possible within Spotify thanks to a lean-back listening experience that prioritises playlists, without the need for any further engagement beyond pressing play. The success of one viral song doesn’t necessarily translate to the rest of an act’s catalogue.
This creates a situation where “artists can be streamed multimillions of times but won’t be able to sell a ticket in their home town”, says music manager and record label co-owner Peter
McGaughrin, who works with acts including Everything Everything, Nilüfer Yanya and Alfie Templeman. Spotify’s announcement posits the platform as the solution to artists feeling spread thin, “pulled in every direction” across multiple platforms to try to build a level of engagement that results in a career.
If Spotify gets it right, McGaughrin says the updates could help an artist build a better long term business. Others are less optimistic. In reaction
to Spotify’s update, independent artist and producer Thys tweeted that digital music “is a convenience, a service” and artists should instead focus on generating revenue on other things, like shows, physical sales and digital sales on platforms such as Bandcamp (although new RIAA figures pointed out that downloads now make up just 3% of recorded music revenues). “Streaming is designed to be cheap. Streaming rates are a race to the bottom. Go beyond.”
The changes come at an interesting time for Spotify, which is still igniting debate over its payout model. Earlier this year, Lucian Grainge, CEO of Universal Music, said: “the critical contributions of too many artists, as well as the engagement of too many fans, are undervalued [on streaming platforms].” Last week, the head of Warner Music, Robert Kyncl, said music is the lowest form of entertainment in terms of monetisation when compared to TV and film.
In some instances, Spotify has actually reduced the amount it pays for music. The Discovery Mode function, which will be rolled out to more artists and labels alongside the new changes, offers promotion in exchange for a lower royalty rate. In a series of recent critical tweets, the Future of Music Coalition called it a “wage suppression scheme”. In defence, Connaughton points towards last week’s announcement that Spotify’s payouts to the music industry are nearly at $40bn, which it says is nearly 70% of every dollar it generates from music.
Although there has been talk of Spotify raising its subscription prices, for now the platform seems to be focusing on trying to increase streams rather than their value. Connaughton also points to the links to ticket and merchandise sales in the app, which will now be featured more prominently. “Many of the updates are squarely focused on creating more avenues for creators to monetise their work and [for artists to] build their business and revenue off the back of that.”
Music and tech consultant Vickie Nauman says Spotify’s ambition to bring artist and fan closer together is a smart one. As she says, the next version of the internet, Web3, which is where newer developments like AI (which powers Spotify’s DJ mode), crypto currency and 3D virtual worlds exist, is all about community.
“In the world that we have now, there are artists and fans and a lot of things in between, like an algorithm or some sort of user experience, that prevents them from feeling connected,” she says. “With Web3, we are entering into a very artist-centric world. The platforms that can get fans as close to the artist as possible are the ones that are going to win.”
It’s clear that Spotify has turned to other apps for inspiration for its new look. The vertical home feed is reminiscent of Instagram and the addition of short video clips brings in a flavour of YouTube and TikTok. The comparison to the latter is particularly interesting – after being heralded as a key music discovery platform, TikTok’s moment in the sun appears to be fading amid talks of it being banned in the US due to security issues. There have also been concerns raised over the amount it pays out for use of music.
But Connaughton says the idea that Spotify is transforming into some sort of TikTok hybrid is rubbish. “We’re not optimising for users to spend most time in an endless feed. We’re trying to focus on reaching one goal, which is helping them find content to listen to or watch, in the case of video podcasts. Any recent conversation about TikTok, or any other platform, is unrelated.”
Spotify’s mission statement is to help a million artists live off their art. This is ambitious given that the number of those generating more than $50k a year through the platform was 17,800 in 2022 and growth within even that bracket has slowed considerably over the last few years. “Ultimately, what we’re trying to do is build the best home for creators,” says Connaughton. It’s still uncertain whether app updates can aid that mission, or if competitors in the Web3 space will figure out a more effective way of serving musicians from inception.
Many of the updates are focused on creating avenues for creators to monetise their work
Tom Connaughton