Taylor Swift’s record label Big Machine Label Group, has removed all traces of the artist’s music from Spotify. Users attempting to access Swift’s material through the service will receive a notification reading “the artist or their representatives have decided not to release this album on Spotify. We are working on it and hope they will change their mind soon.” Neither Swift, nor the label have commented on the move as yet, however Spotify announced “we love Taylor Swift, and our more than 40 million users love her even more – nearly 16 million of them have played her songs in the last 30 days, and she’s on over 19 million playlists.”
The news comes during a week where Swift’s latest album 1979 is expected to exceed one-point-three million copies when SoundScan numbers are revealed on Wednesday 5th of November, making it the highest selling debut week since 2002.
This is not the first time that CEO of Big Machine Label Group, Scott Borchetta, has been linked to concerns over the economics of streaming services. Earlier this year he told the Financial Times “I have real concerns with the biggest companies licensing their catalogues to any streaming service that switches on. It takes a lot of time and effort and money and talent to do this, and if we start giving it all away for fractions of pennies, we’re not going to be able to do it anymore.”
Spotify make it clear on their website that “we pay nearly 70% of our revenue back to the music community,” an amount that is then shared between music rights and publishing owners before making its way to the artists. Spotify is then left to fund its operations with only 30% of its revenues, a model that Generator Research concluded as “inherently unprofitable” following a study of streaming services. Spotify’s financial results to date do little to disprove this, as they have amassed $200M in losses since inception. However, Spotify’s UK division announced that it had made its first profit in 2013 of £2.6M, signalling a potential silver-lining in the company’s earnings.
Borchetta is not the first person to raise concerns over the streaming-service business model. While it pleases music fans by offering a plethora of content for a small subscription fee, numerous artists have been vocal about the size of their royalty payments. The average royalty per play is between $0.006 and $0.008, which can still lead to sizeable royalties for major artists, but does not translate equitably for artists on smaller record labels. Folk singer Damon Krukowski says that one of his albums would need to attract 47,680 plays on Spotify, or 312,000 on Pandora, to equal the income he would receive from a single album sale. Indie-rock band I Am Empire published their quarterly royalty statement on the band’s Facebook site which showed 50,000 streams through Spotify, earning revenue of $3.35, or $0.68 per band member.
Swift remarked on this lack of parity when writing for the Wall Street Journal where she said “individual artists and their labels will someday decide what an album’s price point is. I hope they don’t underestimate themselves or undervalue their art.” The removal of Swift’s music from Spotify is a bold move by Big Machine Label Group in support of this statement. There has been no announcement as yet from the label regarding its other artists on Spotify, which include Cassadee Pope and The Mavericks.