Speaker 1: I remember when I was eight or nine years old
Speaker 1: and my parents finally allowed me to use the record player,
Speaker 1: like all by myself, choose an album line up, the
Speaker 1: needle pulled the little lever, watch as it slowly lands
Speaker 1: on the spinning record, so satisfying. When I moved to
Speaker 1: New York in my twenties, I poke around record stores
Speaker 1: in the East Village near CBGB, but my go to
Speaker 1: place for buying music was Tower Records on Broadway. Like
Speaker 1: It's spent an entire afternoon browsing for c ds, going
Speaker 1: into listening booze, admiring the album art in the little
Speaker 1: jewel cases. The experience, you know, it really brought music
Speaker 1: to life, and I certainly wasn't alone in CD revenue
Speaker 1: made up most of the fourteen point five billion dollar
Speaker 1: music industry. But of course change is the only constant,
Speaker 1: and in two thousand and six Tower filed for bankruptcy.
Speaker 1: It was a sign of the times. Websites like Napster
Speaker 1: and you torrent ushered in a new way to discover
Speaker 1: and share music. Each song could be duplicated and passed
Speaker 1: along endlessly with no loss in quality. Physical music sales plummeted,
Speaker 1: and the music industry suffered a massive pay cut. Music
Speaker 1: had moved to the Internet, where everything is free. Welcome
Speaker 1: to Calling bull Ship, the podcast about purpose washing, the
Speaker 1: gap between what an organization says they stand for and
Speaker 1: what they actually do, and what they would need to
Speaker 1: change to practice what they preach. I'm your host time
Speaker 1: onto you, and I've spent over a decade helping organizations
Speaker 1: define what they stand for, their purpose and then help
Speaker 1: them to use that purpose to drive transformation throughout their business. Unfortunately,
Speaker 1: at a lot of institutions today, there's still a pretty
Speaker 1: wide gap between word and deed. That gap has a
Speaker 1: name bullshit. But, and this is important, bullshit is serious,
Speaker 1: but it's also a treatable condition. So when our bullshit
Speaker 1: detector lights up, we're going to explore everything the organization
Speaker 1: should do to fix it. The same year that Tower
Speaker 1: wreck It's closed, Daniel Eck founded Spotify. He had been
Speaker 1: the CEO of u Torrent, a platform that allowed users
Speaker 1: to anonymously swap large media files. The program itself was legal,
Speaker 1: but it ended up mostly being used to pirate music.
Speaker 1: Pirate of music wasn't profitable, Labels and governments were cracking down,
Speaker 1: and X saw an opportunity. By working with labels and artists,
Speaker 1: he could charge listeners for access to a massive digital
Speaker 1: library and reclaimed the value of music. And so he
Speaker 1: started Spotify with the mission to unlock the potential of
Speaker 1: human creativity by giving a million creative artists the opportunity
Speaker 1: to live off their art and billions of fans the
Speaker 1: opportunity to enjoy and be inspired by it. Streaming now
Speaker 1: makes up about eight of the music industries revenue, and
Speaker 1: Spotify is the most popular streaming service in the world,
Speaker 1: with one eight million people paying for the premium subscription
Speaker 1: and hundreds of millions more listening for free on the
Speaker 1: ad supported tier. But is it actually possible for artists
Speaker 1: to make a living with Spotify? Spotify positions themselves as
Speaker 1: artist friendly their platforms. Spotify for Artists helps musicians get
Speaker 1: stats on listeners and manage their profiles, and they launched
Speaker 1: the Loud and Clear campaign in one to quote give
Speaker 1: artists clarity about the economics of music streaming. How exactly
Speaker 1: do artists and songwriters get paid? Let's break it down first.
Speaker 1: It's important to know that Spotify does not pay artists
Speaker 1: or songwriters directly. Instead, Spotify pays the rights holders. So
Speaker 1: who are they? These are typically record labels, distributors, aggregators,
Speaker 1: or collecting societies. Artists and songwriters choose their rights holders
Speaker 1: and make agreements on their music, including giving them permission
Speaker 1: to deliver it to Spotify. In return, Spotify pays these
Speaker 1: rights holders and they then pay the artists and songwriters.
Speaker 1: As of Spotify has paid over twenty one billion euro
Speaker 1: and royalties to rights holders, including over one billion euro
Speaker 1: every quarter of for a total of five billion euro
Speaker 1: last year alone. That's a lot of cash, but in
Speaker 1: only three percent of artists on Spotify made more than
Speaker 1: a thousand bucks. In fact, most artists make fractions of
Speaker 1: a penny per stream, and people like backup singers and
Speaker 1: songwriters who aren't top build artists make even less. Back
Speaker 1: in the c D age, it was possible to make
Speaker 1: a middle class living as a professional musician. Today that's
Speaker 1: a lot harder. So where does all that cash go?
Speaker 1: Is Spotify's purpose, which they say is to give a
Speaker 1: million creative artists the opportunity to live off their art
Speaker 1: actually a core principle or is that just a song
Speaker 1: and dance? To help me further understand the relationship between
Speaker 1: Spotify and artists. I called up musician, producer, label owner,
Speaker 1: and activist Blake Morrigan. Folks, I am very excited to
Speaker 1: introduce entrepreneur, musician, activist, and all around busy person Blake Morgan. Blake,
Speaker 1: thanks for being here and welcome to calling bullshit. Hey,
Speaker 1: thanks for having me, um so for the folks at
Speaker 1: home as it were. Would you mind just telling us
Speaker 1: a little bit about your your background, how you got
Speaker 1: into music, and and some of your adventures in it.
Speaker 1: I'm a recording artist and songwriter and record producer and
Speaker 1: label owner here in New York City, my beloved hometown.
Speaker 1: Grew up on the Lower East Side, and I've been
Speaker 1: making music my whole life. Both my parents are writers,
Speaker 1: and so I grew up in an artistic household. I
Speaker 1: think if I'd i'd grown up to be a tax attorney,
Speaker 1: that would have been more rebellious growing up to be
Speaker 1: a rock and roll musician as I have. So, you know,
Speaker 1: you've gone on to have a very successful career. You've
Speaker 1: recorded several of your own records and also started your
Speaker 1: own label, E c R. What motivated you to make
Speaker 1: that leap to entrepreneurship, The cliche goes is a necessity
Speaker 1: is the mother of invention. But you know, so it's desperation.
Speaker 1: And I've had a huge record deal with with still
Speaker 1: Ramon and his label and two K, which is Sony Red,
Speaker 1: and it was it was a great artistic experience, but
Speaker 1: it was terrible label. And I had to fight my
Speaker 1: way out of my seven album deal. And I was,
Speaker 1: you know, following sort of standard industry advice and showcasing
Speaker 1: to get other deals. And I was actually walking down
Speaker 1: street with my mother and I said to her, you know,
Speaker 1: if I had any guts, what I would deal is
Speaker 1: I would just start my own label. All these demos
Speaker 1: that I'm making and producing these EPs and pseudo records
Speaker 1: that I'm making, you know, they could actually be real records.
Speaker 1: I had any guts, you know that That's really what
Speaker 1: I would do. And my mother turned to me and
Speaker 1: she was like, yeah, you know what, if you had
Speaker 1: any guts, that is what you would do. Um And
Speaker 1: I remember stopping in the middle of Fifth Avenue in
Speaker 1: the Weaven Street and just putting my hands on my
Speaker 1: knees and oh my god, this is now what I'm
Speaker 1: gonna have to do. And you know, John Milton said,
Speaker 1: it's it's better to rule in hell than serve in heaven.
Speaker 1: And it's turned out not to be hell at all.
Speaker 1: It's turned out to be a heaven of its own.
Speaker 1: It was more desperation even the necessity. It's like I
Speaker 1: had simply gotten tired of handing music that I bled over,
Speaker 1: tired of handing it over to people who then invariably
Speaker 1: screwed it up. Um. And that still happens to this day.
Speaker 1: But now that they when they screw it up, they
Speaker 1: have to deal with me. He was the president that
Speaker 1: you see our music group. And along the way you
Speaker 1: you have become an activist. You've been a critic of
Speaker 1: of streaming platforms in particular like Pandora and and Spotify.
Speaker 1: So I wonder if we could pivot and start to
Speaker 1: talk about Spotify. Um. You know, they're a company who
Speaker 1: says their mission is to unlock the potential of human
Speaker 1: creativity by giving a million creative artists the opportunity to
Speaker 1: live off their art and billions of fans the opportunity
Speaker 1: to enjoy it and be inspired by it. So what, what,
Speaker 1: if anything, do you take issue with in that statement.
Speaker 1: I mean, it's just a statement that appears to have
Speaker 1: words in English strung together. You know, thank God that
Speaker 1: that green logo and that company is here to unlock
Speaker 1: my creative potential because I didn't know what to do before.
Speaker 1: I just didn't know what to do. Thank God for
Speaker 1: Daniel k. Thank God for Daniel Eck, the CEO of
Speaker 1: you Torrents, which then became in bit torn he's a pirate.
Speaker 1: I mean, this statement would be like Philip Morris saying
Speaker 1: we're here to teach people to breathe more deeply. You know,
Speaker 1: I mean, like, where do you even start with a
Speaker 1: sense like if it's so offensive? Yeah, so Hubris in
Speaker 1: that statement for sure. But the part that really gets
Speaker 1: my attention is the by giving a million creative RC
Speaker 1: opportunity to live off their art. How true or untrue
Speaker 1: is that? It's just it's nonsense. You know. The thing
Speaker 1: about Spotify, Their free tier means that when I release
Speaker 1: a record, my record is available for free on every
Speaker 1: phone in the world. Right, Okay, Now, this is not
Speaker 1: the case with Apple, This is not the case with Title,
Speaker 1: it's not the case with Deezer. You know, I wrote
Speaker 1: an op ed you huff in the post. It's started
Speaker 1: with I love streaming and I do you know but
Speaker 1: there aren't all all all streaming platforms are not equal.
Speaker 1: Apple pays twice as much to artists as Spotify. They
Speaker 1: pay songwriters three times as much. They don't attack artists
Speaker 1: when artists criticize the platform, and they reform their platform.
Speaker 1: I don't work for Apple, and Apple is far from perfect.
Speaker 1: But the idea that all streaming services are the same
Speaker 1: is absurd. So let's let's follow that thread for just second,
Speaker 1: and then I want to return to the money. You know,
Speaker 1: other more pro let's call them pro artists platforms have
Speaker 1: been launched, title among them. It doesn't feel like those
Speaker 1: platforms have gotten the traction that Spotify has though, you know,
Speaker 1: just in terms of sheer size and momentum. Why is that, Well,
Speaker 1: that's a narrative that Spotify has put out into the world.
Speaker 1: So let's be clear about a couple of things. Spotify
Speaker 1: has a free tier. Apple does not. So this is
Speaker 1: where we run into a problem. Spotify has essentially a
Speaker 1: quote unquote legalized pirates platform, which is their free tier. Right,
Speaker 1: So that's the comparing Spotify to Apple titled Deezer and Amazon.
Speaker 1: It's not the same business model whatsoever. And the bind
Speaker 1: that Spotify is, and of course is that you know,
Speaker 1: Spotify actually thinks it's saved music. And I've dealt with
Speaker 1: many executives of Spotify. One of the big parts of
Speaker 1: my music advocacy is actually about big radio and the
Speaker 1: music fairness at and so I deal with big radio
Speaker 1: broadcasters all the time, and I liken the bullshit and
Speaker 1: the big radio broadcasters. They're sort of like big oil
Speaker 1: or big tobacco in that they know that they're doing
Speaker 1: wrong and they almost kind of admit it, but they're
Speaker 1: basically able to get away with it. So they're gonna
Speaker 1: get away with it for however long they're going to
Speaker 1: get away with it, and then they'll move on. Spotify
Speaker 1: is very different. When you talk to executives that Spotify,
Speaker 1: they are evangelistic about the platform. They really believe that
Speaker 1: they are saving music. So the bullshit in the statement
Speaker 1: that you read at the top of this part of
Speaker 1: the conversation isn't just offensive and ridiculous. They need it.
Speaker 1: It's a really amazing phenomenon. I wonder if you could,
Speaker 1: just because most people, myself included, don't really understand this,
Speaker 1: can you explain the relationship between Spotify, record labels and musicians, like,
Speaker 1: how do the royalties work in streaming? So Spotify pays
Speaker 1: um sev of their revenue to right solders. Okay, this
Speaker 1: is a number that they tout constantly because they it
Speaker 1: sounds like an amazing number, Like, well, wait a minute,
Speaker 1: what's the problem like that They're they're paying seventy of
Speaker 1: revenue out to right solders? Right right. But again, even
Speaker 1: if we forget about the free tier for a moment,
Speaker 1: and we remember that a subscription of Spotify its ten
Speaker 1: dollars a month, So ten dollars a month is a
Speaker 1: d twenty dollars a year, and over the course of
Speaker 1: that year, as a Spotify subscriber, you can listen to
Speaker 1: tens of thousands of songs, thousands of records. Right at
Speaker 1: the end of that year, all of those people who
Speaker 1: made all of those records are splitting sevent a hundred
Speaker 1: and twenty dollars, which is eighty four dollars. So you
Speaker 1: just list into four thousand songs that year. All of
Speaker 1: the people, not just the artists, all the people who
Speaker 1: made those records, all the people who worked on all
Speaker 1: of the revenue that went into making all of those records,
Speaker 1: All of those people are splitting eighty four dollars, And
Speaker 1: that's fundamentally the problem with streaming. They fundamentally undermined the
Speaker 1: ability of musicians to make a living at their at
Speaker 1: their music. So that's how the money works, plain and simple,
Speaker 1: and we can get granular about different parts of it.
Speaker 1: But seventy of a hundred and twenty dollars is eighty
Speaker 1: four dollars after a year. Where does the other Here
Speaker 1: are some important numbers when it comes to you know again,
Speaker 1: how this breaks down. Where does the money go? Where
Speaker 1: does spotifystent go? Right? So it takes an artist like me,
Speaker 1: uh or any artist on Spotify. It takes four hundred
Speaker 1: thousand streams a month for me to earn minimum wage
Speaker 1: on Spotify four hundred thousand streams a month to earn
Speaker 1: minimum wage. So the money where does that percent go?
Speaker 1: It goes to paying coders, It goes towards paying for
Speaker 1: Spotify is five and fifty million dollar offices here in
Speaker 1: downtown Manhattan, year ground zero, and it goes towards paying
Speaker 1: Joe Rogan two hundred million dollars for his racist and
Speaker 1: misogynistic and homophobic anti science podcast. So that's where your
Speaker 1: money is going that's where goes. So of all the
Speaker 1: artists on Spotify, how many of them get even four
Speaker 1: hundred thousand streams? I mean, four hundred thousand streams is
Speaker 1: not a superstar number, but it's a serious number because
Speaker 1: you'd have to do it every month, you know. So
Speaker 1: it's four million streams after ten months. That's a lot
Speaker 1: of streams. I would imagine that the amount of artists
Speaker 1: getting four hundred thousand streams a month would be at
Speaker 1: least in the single digit percentages, if not in the
Speaker 1: like two percent, three percent, one percent kind of thing.
Speaker 1: It's very very it's very few. Yeah, crazy. Let's pivot
Speaker 1: to to just talk about some of the things that
Speaker 1: you've been up to in terms of solutions. First of all,
Speaker 1: you started a movement called hashtag I Respect Music, and
Speaker 1: as a part of that, you know, you've said that
Speaker 1: you were against the way streaming companies treat musicians, but
Speaker 1: you're not against streaming itself, and I wonder if you
Speaker 1: could break that down for us. You know, I love streaming,
Speaker 1: I love its convenience, I love making playlists, I love
Speaker 1: I love lots of things about it. But you know,
Speaker 1: so how can I love streaming but be against the
Speaker 1: way streaming is affecting musicians. Just because I'm saying that
Speaker 1: we should be paid fairly and unscrupulous, you know, corporations
Speaker 1: like Spotify should be reformed. That doesn't mean that I
Speaker 1: think streaming is the problem. So who is getting it right?
Speaker 1: You've mentioned Apple? Is it sounds like better? Um? Are
Speaker 1: there other services that you feel like are are doing
Speaker 1: a better job. All of the major dreaming services are
Speaker 1: doing a better job than Spotify. Apple is better, far
Speaker 1: from perfect, but they're better. Title far from perfect, better either,
Speaker 1: actually maybe one of the best. Right. I was very
Speaker 1: excited back in the day when Title launched, you know,
Speaker 1: because it seemed like they had real some some very
Speaker 1: famous artists backing and and the proposition appeared to be
Speaker 1: to create a service that was pro artist and try
Speaker 1: to get consumers of music to adopt that platform as
Speaker 1: a as a kind of rebellion against the way that
Speaker 1: musicians are treated in the industry. But it doesn't appear
Speaker 1: that Title has has taken off. What what went wrong there?
Speaker 1: I think that they really had their hearts in the
Speaker 1: right place, and I think they still do. Um, that's
Speaker 1: the platform you want to be on as a subscriber
Speaker 1: if you really care about Audio's a really good example.
Speaker 1: But I think that they really bundled their press conference
Speaker 1: because the way that they came out is that they
Speaker 1: had all of these mega stars at their press conference
Speaker 1: at their launch, and they were all talking about how
Speaker 1: they weren't paid enough. And it's true, they're not paid enough,
Speaker 1: But the problem with that tack is that then what
Speaker 1: listeners do is they see a press conference like like that,
Speaker 1: and they're like, why do I care if Madonna isn't
Speaker 1: getting enough money? She's got millions of dollars, Why don't care?
Speaker 1: Fiance is not. And what I wish that they had
Speaker 1: done in their press conferences if they had had in
Speaker 1: a row on stage, if they'd had Madonna and to
Speaker 1: her left a music teacher, and to the music teachers
Speaker 1: left Jay Z and this is and the sound engineer
Speaker 1: and the carpenter who builds the recording student, and the
Speaker 1: guy who's driving the van, and the woman who's setting
Speaker 1: up merch because all of those people are funded as
Speaker 1: part of our music industry. So I think that's the
Speaker 1: mistake that they made. Um it was a pr mistake,
Speaker 1: but I do think that their hearts are in the
Speaker 1: right place, just following the thread of changes that that
Speaker 1: need to be made. Are there legislative avenues to solve
Speaker 1: this problem? I think that legislation is one way to go.
Speaker 1: I think digislation is going to be much more helpful
Speaker 1: when it comes to the battle that we have with radio,
Speaker 1: which you know, some of your listeners may not even
Speaker 1: know that artists don't get paid anything for radio airplay
Speaker 1: in the United States. The United States is the only
Speaker 1: democratic country in the world where artists don't get paid
Speaker 1: for radio air That just blows me away. Has that
Speaker 1: always been true? Always been true? The only countries in
Speaker 1: the world that share the distinction with the United States
Speaker 1: or North Korea, Iran and China. Nice good company. You
Speaker 1: meant yes, you mentioned I respect music, which is something
Speaker 1: of an homage to Aretha Franklin, because Aretha Franklin never
Speaker 1: got paid one dime for for respect being on the
Speaker 1: radio United States, which is insane. That's insane, It's completely insane.
Speaker 1: It's completely insane. And um That also impacts the streaming debate,
Speaker 1: and it impacts the struggle with Spotify, because what Spotify
Speaker 1: says to musicians is, hey, listen, we don't pay you
Speaker 1: a lot, but you know what, it's better than nothing,
Speaker 1: and you get nothing on radio. So if we can
Speaker 1: close the loophole that big, big radio has enjoyed for
Speaker 1: a hundred years, that's going to actually really effects how
Speaker 1: we're able to propressure on streaming services, which we want
Speaker 1: to do. You know, it's interesting other parts of the
Speaker 1: media business went through this after the music business and
Speaker 1: seemed to have recovered. Like there was a period of
Speaker 1: time when there was a big there was a collapse
Speaker 1: of of many journalistic entities because people were getting their
Speaker 1: news for free and didn't want to pay, And it
Speaker 1: turns out that for the right outlet, people will pay
Speaker 1: for it. Have we trained people at this point that
Speaker 1: music should be free and is the problem untraining them? Yeah,
Speaker 1: that's a big part of you know, a major problem
Speaker 1: that Spotify has that I've talked about often is Spotify
Speaker 1: doesn't make anything. Do you see the motion picture industry
Speaker 1: or the television industry or actor's equity up in arms
Speaker 1: about Netflix or HBO or Apple? No, you know why,
Speaker 1: because Netflix makes things, They make stranger things, which employs
Speaker 1: gaffers and carpenters and screenwriters and actually right, they make things.
Speaker 1: Spotify doesn't make anything. So again, there are a distribution
Speaker 1: platform and they take thirty of revenue. Why why are
Speaker 1: they taking to upload my my music to the magical interweb?
Speaker 1: And there's another thing that Spotify I could do that
Speaker 1: would really change things, and in fact that this is
Speaker 1: something Apple could do. All of the major streaming services
Speaker 1: have a payment model outside of Deezer. Deezer is the
Speaker 1: one that's changed, and your listeners may not notice either.
Speaker 1: But you may think that I get paid a certain
Speaker 1: fraction of a penny per stream when I'm streamed on
Speaker 1: Spotify or Apple, but I'm actually not. There's no streaming
Speaker 1: rate nor is Like if you have a ten dollar
Speaker 1: subscription to a streaming service Spotify, Apple, something like that,
Speaker 1: you'd think that the people you listen to are splitting
Speaker 1: the seven dollars of your ten dollars, like in other words,
Speaker 1: that your seven dollars is going to the people that
Speaker 1: you listen to. But that's not the way it works
Speaker 1: at all. The major streaming come copanies outside of Deezer
Speaker 1: and SoundCloud has changed as well. They use a pro
Speaker 1: radar system where all of the streams are put into
Speaker 1: a pool divided by the amount of streams, and then
Speaker 1: you get paid by the amount of market share you
Speaker 1: have in that pool. Because Beyonce has a larger market
Speaker 1: share than I do, it means that she's actually getting
Speaker 1: paid more money from my streams than I am. It's
Speaker 1: not a listener centric model, obviously. The way it should
Speaker 1: work the artist, the artist who gets listened to should
Speaker 1: get paid, should get that s exactly. And what that
Speaker 1: would do just the obvious thing of like, well, wait
Speaker 1: a minute, you don't even get paid for the streams
Speaker 1: that you're actually receiving. What that would do is that
Speaker 1: would shore up local artists, niche artists, niche genres as
Speaker 1: opposed to the constant gravity pool of mainstream gigantic pop music.
Speaker 1: And it wouldn't cost them anything. It's the same seven dollars.
Speaker 1: It's just going to the right people. So what what's
Speaker 1: it going to take? I saw that a bill has
Speaker 1: been introduced uh the American Music Fairness Act. What's the
Speaker 1: status of that? Would that begin to level the playing
Speaker 1: field for artists? American Music Fairness Act would actually finally
Speaker 1: close the loophole and and American broadcast radio would have
Speaker 1: to pay artists for radio play. Yes, just just like
Speaker 1: the rest of the world. Is it going to pass? Well,
Speaker 1: we're really hopeful, and it was just introduced into the
Speaker 1: United States Senate, so it has a lot of momentum
Speaker 1: um and we find like this is the farthest that
Speaker 1: this bill has ever gotten. There's been versions of this
Speaker 1: bill earlier, but there's a different kind of ground swell now.
Speaker 1: I think that listeners, music lovers, and music makers have
Speaker 1: really come together with this bill and said, well, wait
Speaker 1: a minute, there's a lot of things that we can't fix,
Speaker 1: and this is not one of those. This is easy
Speaker 1: to fix. To one, how does Spotify think about this? Um?
Speaker 1: You were you were part of a meeting with Spotify
Speaker 1: execs uh with some artists a few years back, and
Speaker 1: it ended in a debate. But can you talk about
Speaker 1: your experience in that meeting? Sure? So I was invited
Speaker 1: to this so called artists only meeting with Spotify about artists,
Speaker 1: and uh. It turned out that it was kind of
Speaker 1: a trojan horse. They had several artists that nobody had
Speaker 1: heard of on a panel, all just touting how wonderful
Speaker 1: Spotify is. And then people in the audience started raising
Speaker 1: their hand and saying, excuse me, what the hell is
Speaker 1: going on here? What what we were supposed to have
Speaker 1: a dialogue here, you're preaching to us about what your
Speaker 1: whole platform is about. So it became very contentious, and
Speaker 1: as you would imagine, I was a vocal participant in
Speaker 1: the meeting and uh and afterwards, um, a bunch of
Speaker 1: exects from the company sort of you know, surrounded me
Speaker 1: and we were talking and they're like, Blake, I just
Speaker 1: don't understand where why do you say these things like
Speaker 1: our product is so fantastic, it's the best product there is.
Speaker 1: And another guy would say, Blake, I think if you
Speaker 1: understood more about our product, like you realize that it's
Speaker 1: just the greatest thing that's ever happened. But they get
Speaker 1: really emotional, and I said, Fellas, you know, you keep
Speaker 1: using this word product and I'm just curious, what do
Speaker 1: you think your product is? And the executives said, what
Speaker 1: do you mean Our product is Spotify? And I said, no, Fellas,
Speaker 1: it's not Spotify. Your product is music. You're confusing the
Speaker 1: word product with the word brand. And the guy I
Speaker 1: was talking to you went, you know, man, you're crazy. Man,
Speaker 1: it's crazy. It is our product is. And I had
Speaker 1: to say, like, you know, while we're at it. By
Speaker 1: the way, stop calling people users. They're not users their listeners.
Speaker 1: You're the user. You're using our music to monetize our
Speaker 1: little listeners for your profit. That's what you're doing. And
Speaker 1: you really looked at me like I shot Santa Clause
Speaker 1: in the face. You know, But that's I think it's
Speaker 1: an important story. It's it's it's funny, but you know,
Speaker 1: that's not what happens when you talk to broadcasters. It's
Speaker 1: very specific with Spotify, and it's a really like religious
Speaker 1: atmosphere over there where you feel like you're talking to creepy,
Speaker 1: weird cult people. And I'm not having a go just
Speaker 1: to like be mean. It really just is like that,
Speaker 1: and that story kind of illustrates them. Yeah. Um, so
Speaker 1: I want to wrap up with with two questions. First
Speaker 1: of all, um, if you were Daniel Eck, what are
Speaker 1: the things that you would do to change Spotify. I'll
Speaker 1: give you three, all of which he could do by
Speaker 1: the end of the day today. The first is he
Speaker 1: could do away with his free tier. Music should not
Speaker 1: be free. Okay, it's morally wrong, it's it's uh, it's
Speaker 1: a bad business practice. So he should do away with
Speaker 1: the free treat free tier number one, number two. As
Speaker 1: I outlined before, the people who get strained are the
Speaker 1: people who should be paid. I should be paid for
Speaker 1: the streams eye garner. Other people shouldn't be paid for them.
Speaker 1: It would save UM niche artists, It would save UH
Speaker 1: fringe artists, It would it would be would be a
Speaker 1: huge boon to jazz music, classical music, big band music,
Speaker 1: blue ask music, and on and on and on. So
Speaker 1: that's the other thing. Switching to the listener centric model.
Speaker 1: He could do that by sundown doesn't cost Spotify anything.
Speaker 1: It's the same seven dollars just going to the right people.
Speaker 1: And the third thing he could do he could do
Speaker 1: away with the counter, the number next to all of
Speaker 1: the songs on Spotify that tell you how many times
Speaker 1: it's been streams. Interesting, what's the virtue of this number?
Speaker 1: I get that Tom Waits's music is not less valuable
Speaker 1: because it's been listened to less than Nickelback. Right, So
Speaker 1: that's the third that's the third thing he could do,
Speaker 1: And there are many others, but those three things he
Speaker 1: could do by midnight tonight. Man, Yeah, I love that.
Speaker 1: I love all three of those. Okay, last question on
Speaker 1: this show, Blake, we have a tool called the b
Speaker 1: S Scale. It goes from zero to one hundred, zero
Speaker 1: being the best zero bs, one hundred being the worst
Speaker 1: total BS. So on that scale, what score would you
Speaker 1: give Spotify? Okay, that was definitive, Blake. This has been
Speaker 1: a fantastic and illuminating conversation. I want to thank you
Speaker 1: for coming on the show today. Well, thanks so much
Speaker 1: for having me, folks. At this point, my BS detector
Speaker 1: is playing highway to the danger zone. The bottom line
Speaker 1: here is that Spotify spends a lot of money on
Speaker 1: their brand, but they don't fairly compensate the people who
Speaker 1: actually create their product. After speaking with Blake, it's clear
Speaker 1: that the b S and the music industry extends way
Speaker 1: beyond Spotify. Blake was so demoralized by record labels that
Speaker 1: he was compelled to start his own. I also cannot
Speaker 1: believe that every single radio station in the US plays
Speaker 1: music without paying for it. I really can't believe that
Speaker 1: that's insane. The good news is there are real opportunities
Speaker 1: here for Spotify to change their tune and better support
Speaker 1: the artists who's support them. So we've assembled a panel
Speaker 1: of industry experts to help them make that shift right
Speaker 1: after the break clip the record check on the B side. Folks,
Speaker 1: I am very excited to introduce two industry experts who
Speaker 1: are going to help us help Spotify better live their
Speaker 1: stated purpose. Our first guest is two time Grammy winning
Speaker 1: artist and executive producer Cadence. Cadence, Thanks for being here
Speaker 1: and welcome to calling bullshit. I'm happy to be here.
Speaker 1: Thank you for having me so, Cadence. I'd love it
Speaker 1: if you could just tell us a little bit about yourself.
Speaker 1: I started off as an artist and then I fell
Speaker 1: in love with songwriting. Once I decided to move out
Speaker 1: to l A. Um was when really things changed for me.
Speaker 1: I would say like it was a very creative, but
Speaker 1: I wasn't thinking so much business. Uh So when I
Speaker 1: came out to l A I really got uh slapped
Speaker 1: in the face with the reality of business. You know.
Speaker 1: I've had some some really big records, thank You, Next
Speaker 1: Seven Rings, Black Parade, Um, to name a few, and
Speaker 1: you would think that I would be well off. Um. So,
Speaker 1: you know, while they had a budget for this in
Speaker 1: the past before streaming really hit, there's not that now. Now.
Speaker 1: It's almost like they expect these songwriters to just do
Speaker 1: it for free. So I hopped into executive producing. I
Speaker 1: saw that you were on the board of an organization
Speaker 1: called the Hundred per Centers. Can you talk more about
Speaker 1: what theer is all about. Sure, Yeah, we're all about
Speaker 1: advocating for creative rights, UM, just sustainable income. We're just
Speaker 1: advocating for change all over the board. UM even to
Speaker 1: this day, like people, active listeners, consumers don't just don't
Speaker 1: understand how music or streaming works. But I think if
Speaker 1: people were more aware of the effects and you know,
Speaker 1: the the issues, that there would be a shift because
Speaker 1: it's it's more than just the artists. Like, yes, of
Speaker 1: course the artist is a very major part of this,
Speaker 1: but the the collaborators, the creatives behind the music, UM
Speaker 1: are the ones that are are hurting even more. Thank you.
Speaker 1: And we'll return to that theme a little bit later
Speaker 1: in the show as well, Cadence, because we want to
Speaker 1: dig into all of that. UM. But but I want
Speaker 1: to introduce our our next guest. Next up, we have
Speaker 1: David Turner, who is the writer of a widely read
Speaker 1: newsletter on music streaming called Penny Fractions. David, welcome to
Speaker 1: the show. I'm gonna say hey, hey, everybody, thank you
Speaker 1: for having me on today. So, David, could you tell
Speaker 1: us a little bit about yourself in your background? Yeah,
Speaker 1: totally so. Yeah. So my day job is I a
Speaker 1: strategy manager of SoundCloud, or i've been the last four years.
Speaker 1: Prior to that, I was a music journalist where I
Speaker 1: sort of covered different parts of the music industry, did
Speaker 1: a lot of reviews, interviews, features, covered a lot of
Speaker 1: like viral trends. So, I mean, I've been a fan
Speaker 1: of music for most of my life. I like playing guitar.
Speaker 1: I like thought about maybe could I DJ, but never
Speaker 1: really took it that seriously, don't have the talent, but
Speaker 1: I feel like I'm pretty good at writing. So that's
Speaker 1: one thing I sort of kept up, which I do
Speaker 1: be in my news letter of Penny Fractions, which I've
Speaker 1: been doing for almost five years, which yes, like you said,
Speaker 1: covered streaming, but also many parts of the music. This
Speaker 1: sometimes we get a little bit of history of of
Speaker 1: different music companies. So yeah, it's something that I've been
Speaker 1: really passionate about the last few years and been really
Speaker 1: excited to like see where it's gone to take great well,
Speaker 1: I feel really lucky to have you both on the show. Uh,
Speaker 1: let's get right into it. Cadence, I'm gonna ask you
Speaker 1: to lead us off in two minute are less. What
Speaker 1: would you tell CEO Daniel Eck to change at Spotify
Speaker 1: to better live their purpose, which, just to remind folks,
Speaker 1: is to unlock the potential of human creativity by giving
Speaker 1: a million creative artists the ability to live off their
Speaker 1: art and billions of fans the opportunity to enjoy and
Speaker 1: be inspired by it. I would say, for one, I
Speaker 1: think right now the Spotify premium is um I think
Speaker 1: that can for one, be increased, as well as just
Speaker 1: having transparency about where this money is going. I feel
Speaker 1: like they kind of just wipe their hands and say, hey, um,
Speaker 1: you know it's the label's fault. And I just think
Speaker 1: that in order for everyone to feel like this is
Speaker 1: fair and uh just understand how this is being distributed,
Speaker 1: that we just need transparency, we need we need receipts. Right. Yeah,
Speaker 1: So can you talk a little bit more about the
Speaker 1: transparency part of your idea because that feels important to me.
Speaker 1: If your purpose is to help artists live off live
Speaker 1: off their art, right, fans need to know how the
Speaker 1: system actually works. And I don't think a lot of
Speaker 1: fans really do. Right for right now, we know UH
Speaker 1: that we get penny's worth of a dollar for UH
Speaker 1: for streaming, but we don't necessarily as far as transparency.
Speaker 1: We don't know what the agreements are between the labels
Speaker 1: and Spotify, Spotify or any streaming platform for for that matter.
Speaker 1: And because of that, we don't know where half of
Speaker 1: these funds are going to and like what we're actually
Speaker 1: getting paid. It just feels messy, it feels secretive, and
Speaker 1: so I think if we have a better understanding of
Speaker 1: how that's that's happening. I mean, I'm looking at like,
Speaker 1: remember over the pandemic, I'm trying to think it was
Speaker 1: billions of dollars that went to the labels that they
Speaker 1: proudly spoke about openly, And I'm sitting here looking at
Speaker 1: my statements and I'm like, whoa that it just doesn't
Speaker 1: add up. Um, you know, like, how how is it
Speaker 1: that I have these songs and and my b and
Speaker 1: my statements even over the pandemic, Like I I could
Speaker 1: not even make rent for the next two months, Like
Speaker 1: that's that doesn't make sense. Yeah, that's crazy. David, do
Speaker 1: you have any thoughts on on what Cadence has been
Speaker 1: talking about totally. So I'm going to say I think
Speaker 1: the first idea about increasing the amount of money that
Speaker 1: subscription costs makes a lot of sense. That's an idea
Speaker 1: that I think many folks across the music industry. What's
Speaker 1: the part and it's something that I know many folks
Speaker 1: have been wanting to sort of get behind. I think
Speaker 1: the biggest issue is I think many people aren't sure
Speaker 1: customers are willing to take that sort of increase on
Speaker 1: their subscriptions, especially when there are a number of streaming
Speaker 1: services out here. But it certainly I understand that the
Speaker 1: need and sort of the import of increasing how much
Speaker 1: the subscription goes needs more money can go to songwriters
Speaker 1: and recording artists, So that totally makes a lot of
Speaker 1: sense to me. And then around the issue of transparency,
Speaker 1: just to be real quick, is uh, I think that
Speaker 1: one is also another one where like, yeah, a little
Speaker 1: bit more transparency and clarity around how money move and
Speaker 1: money pay payments go I think would be helpful. I
Speaker 1: do think that is something broadly speaking, is that like
Speaker 1: every part of the industry sort of needs like step
Speaker 1: up to sort of help with that. Not always all
Speaker 1: on the DSP. It's not always I mean, I guess
Speaker 1: it's a lot quite a bit on the labels and
Speaker 1: the contracts you actually end up signing, so that actually
Speaker 1: is where a lot of that ends up resting. But
Speaker 1: it is something where like their needs to be some
Speaker 1: kind of sort of agreed upon way to try to
Speaker 1: clear up some of this confusion. Yeah, I was reading
Speaker 1: an article just on the price raies. Point like Rhapsody
Speaker 1: charged ten bucks a month in two thousand and two
Speaker 1: and Spotify charges ten bucks a month in two and
Speaker 1: if you just adjust for inflation, Spotify should be charging
Speaker 1: this article said fifteen fifty and that's just just to break,
Speaker 1: you know, to stay even. And in that time Netflix
Speaker 1: has gone from eight bucks to fifteen fifty a month.
Speaker 1: And you know, another thing that they do that I
Speaker 1: wasn't aware of is they do a lot of discounting.
Speaker 1: So they have a student plan that's like five bucks
Speaker 1: a month, and they have a family plan, and all
Speaker 1: of that cuts into the amount of money that they
Speaker 1: come they bring in and and therefore can distribute to artists.
Speaker 1: And so cleaning that up would be another aspect of
Speaker 1: of raising their price right to to help get more
Speaker 1: money to the artists. Okay, David, your turn in two
Speaker 1: minutes or less? What advice would you give Daniel ac Oh?
Speaker 1: They advice that out and kept act. I think would
Speaker 1: be maybe a little bit less of advice and more
Speaker 1: of a question that I think could be sort of
Speaker 1: turned into sort of broader advice. My question would be
Speaker 1: that if you're going to have a million artists sort
Speaker 1: of make a living on your platform, how do you
Speaker 1: plan to actually sort of like support those million artists.
Speaker 1: How many people are gonna be working at Spotify? How
Speaker 1: many more tens of thousands of people do you need
Speaker 1: to like handle all of that? Are you gonna be
Speaker 1: helping out with healthcare? It's all like there's a lot
Speaker 1: of like questions to me that when I sort of
Speaker 1: see here that mission statement, I think and it's very
Speaker 1: grandiose and and and aspires to a lot and on
Speaker 1: one part of it, the sense of having a million
Speaker 1: a billion fans like Spotify as like hundreds of millions
Speaker 1: of listeners, so like they are like well on their
Speaker 1: way to that, But as far as like a million
Speaker 1: artists that are making a living, they're certainly not on
Speaker 1: the on the way to that. In the same in
Speaker 1: the same sort of subjectory. Just to what David said,
Speaker 1: I think that is a very strong question, especially for
Speaker 1: artists that aren't signed to major labels, because major labels are,
Speaker 1: you know, technically the biggest shareholders of Spotify, so they
Speaker 1: control most of it. They control those playlists, they control
Speaker 1: you know, their artists getting more plays in these indie artists.
Speaker 1: You know, I don't see these indie artists invited to
Speaker 1: these Spotify branches. I see major label a major artist. Um,
Speaker 1: so how are you really leveling the playing field so
Speaker 1: that you give these indie artists an equal chance? Yeah,
Speaker 1: And I've heard that the way that that Spotify pays artists,
Speaker 1: and and this is I'm still trying to get my
Speaker 1: head around this. Like I, as I understand it, you're
Speaker 1: not actually paid per stream even on Spotify as an artist.
Speaker 1: The money goes to the rights owners, and then that
Speaker 1: money then goes to the artists, and it's a portion
Speaker 1: based on essentially averages, you know, the percentage of streams
Speaker 1: on the platform that belonged to Beyonce. Then Beyonce gets
Speaker 1: uh that percentage of money. But it means that Beyonce
Speaker 1: in one way, as I understand it, Beyonce is getting
Speaker 1: a percentage on lots of indie artists streams as well
Speaker 1: because of the way that they do the accounting. And
Speaker 1: so I've seen people advocate for a more direct model
Speaker 1: there that like you actually pay your money as a
Speaker 1: listener because they know who you are and they know
Speaker 1: what you're paying them, that your money goes directly to
Speaker 1: the artists that that you're listening to. What do you
Speaker 1: think about that? Yeah, so I'll just speak on the
Speaker 1: recording side. Yes, what you said is correct, where it's
Speaker 1: like all the money is sort of accrudance is sort
Speaker 1: of a big pot they said in the industry is
Speaker 1: called sort of the pro rottle model. So, for example,
Speaker 1: with Beyonce dropped her like this album and she had
Speaker 1: seven percent of total streams that week, she would she
Speaker 1: and the rest of the folks on the album will
Speaker 1: be seven percent of over of the overall pot of
Speaker 1: revenue generating in that period of time. So yeah, so
Speaker 1: it does sort of work out where if you were
Speaker 1: paying a Spotify subscription or an Apple Music or Amazon
Speaker 1: subscription and you do not listen to Beyonce, you're some
Speaker 1: seven some part of your money would still be going
Speaker 1: towards Beyonce and the work, the work that she did
Speaker 1: on that on that release. And yes, the other thing
Speaker 1: that you're sort of hinting at with this thing called
Speaker 1: the use a centric model, which I guess it's been
Speaker 1: sort of mentioned by a number of companies like Deezer,
Speaker 1: which is a French music fiom so can also title
Speaker 1: I think of maybe years ago. And also it's SoundCloud.
Speaker 1: Actually in summer, SoundCloud announced a partnership with one Er
Speaker 1: Music Group where we actually we're now playing out artists
Speaker 1: on one or one of the big three major labels
Speaker 1: on the eccentric model along with artist that directly distribute
Speaker 1: through through the platform. So but again that is all
Speaker 1: just on the recording side. On the publishing on the
Speaker 1: songwriter side is slightly different, like the way that's handled
Speaker 1: very yeah, very different. Uh, our money goes through the publishers,
Speaker 1: so we get what we get and yeah, we have
Speaker 1: no control over over it. We feel like the powerless
Speaker 1: m hmm. Yeah, and so somebody needs to take the
Speaker 1: artist's side. So why don't we use that as a
Speaker 1: moment to pivot to my my idea and again be savage.
Speaker 1: I'm a total rookie here. So what I take away
Speaker 1: is that Spotify actually is in like a vice or
Speaker 1: you know, another to four would be between a rock
Speaker 1: and a hard place, because all of their competitors also
Speaker 1: charged ten bucks a month, and so Spotify as a
Speaker 1: service is basically an undifferentiated commodity, and commodities have trouble
Speaker 1: raising their prices to make matters worse. You know, two
Speaker 1: of their competitors are Apple and Amazon, and Apple and
Speaker 1: Amazon can afford to lose money forever in music just
Speaker 1: because uh, music isn't their main job. It's a side
Speaker 1: hustle to them. And so to get out of this vice,
Speaker 1: Spotify has to innovate. And you've seen them trying, like
Speaker 1: they tried video and that didn't work. They've tried actually
Speaker 1: going around the rights holders by by you know, cutting
Speaker 1: direct distribution deals with some artists, and that didn't work
Speaker 1: because the labels pushed back. Now they're trying podcasting and
Speaker 1: that led to the Joe Rogan debacle. And so as
Speaker 1: I thought about, like what they do have, they have
Speaker 1: two things. They have a great artist centric purpose, this
Speaker 1: idea that they want to take a million artists and
Speaker 1: make it so they can live off their art, which
Speaker 1: I love and they have scale. They're big, um I
Speaker 1: think four hundred and six million monthly actives currently. So
Speaker 1: my idea is for Spotify to become a laboratory for
Speaker 1: artists centric innovation, to continue to innovate themselves. But also,
Speaker 1: and maybe this will be controversial, I don't know, but
Speaker 1: also to look across the industry for other really good
Speaker 1: ideas that that other platforms are trying but maybe don't
Speaker 1: have Spotify scale like Title, and adopt it to scale it.
Speaker 1: So to use their scale for good is the essence
Speaker 1: of my idea. And I'll continue to use Title because
Speaker 1: I was reading an article in a in a thing
Speaker 1: called louder Sound, and I'll just read from this article.
Speaker 1: Title recently unveiled their direct artist pay up plan and
Speaker 1: which sees ten percent of your subscription going directly to
Speaker 1: the artists that you listen to most. This initiative is
Speaker 1: based on actual streaming activity of the fans versus the
Speaker 1: industry accepted method of aggregating streams and allocating it to
Speaker 1: the most popular artists. According to Title, uh so this
Speaker 1: is a move. This is now the writer of this
Speaker 1: article saying this is a move away from some other
Speaker 1: payment plans and could cause a shift in the streaming industry.
Speaker 1: And so what I'm advocating for is, let's use it
Speaker 1: to cause a shift in the industry. Let's Spotify adopt
Speaker 1: this as well as well as any other great artists
Speaker 1: centric ideas across the industry and really deploy them at
Speaker 1: scale to help fans support artists directly and take on
Speaker 1: the mantle of artists centricity, which is, you know, sits
Speaker 1: at the center of their purpose. What do we think
Speaker 1: about that pipe dream possibility? In many ways, I think
Speaker 1: what you're sort of describing as kinds of me like Instagram.
Speaker 1: Soon It's like on Snatchat they took on the story
Speaker 1: feature of Snapchat, and people are like, oh wait, Snapchat.
Speaker 1: I love Snapchat. But now all of a sudden, it's
Speaker 1: it is it is what I'm describing. Yeah, but I'm
Speaker 1: trying to say for good because that that practice I
Speaker 1: think of as evil, like the whole Facebook empire. He
Speaker 1: Zuckerberg does this to put other companies out of business.
Speaker 1: And what I'm saying is, since Spotify has skill, maybe
Speaker 1: they could use it for good. Maybe Yeah, I don't know, Yeah, no,
Speaker 1: I guess I guess the reason why that immediately jumped
Speaker 1: to me with because I think of the perception of
Speaker 1: the users is that perception of users would probably immediately
Speaker 1: go towards that doing this thing. I think because because
Speaker 1: if you say that you're doing this because you want
Speaker 1: to help, but if it's just topping someone else, you're like, oh,
Speaker 1: well wait, why are you helping by copy it didn't
Speaker 1: have any of your own ideas. I think that maybe
Speaker 1: I think that maybe sort of especially as like a
Speaker 1: user of different platforms, and when all of a sudden,
Speaker 1: every platform to your point had the same price point
Speaker 1: and all of a sudden are the same features set,
Speaker 1: you get a little less excited to hop between them
Speaker 1: because you're like, oh, what if they're doubely different shape,
Speaker 1: So you kind of need for the bigger company to
Speaker 1: kind of have more actual innovation in an actual different differentiation.
Speaker 1: But to the specifics I will actually say, I do
Speaker 1: like that Tyle was saying this to someone yesterday, that
Speaker 1: title actually has a number of really great features, Like
Speaker 1: they actually highlight songwriters. They actually highlight producers of tracks,
Speaker 1: so you can actually search for a producer, starch first songwriter.
Speaker 1: There are a lot of things that title does that
Speaker 1: other platforms don't do. So I do think there is
Speaker 1: quite a bit actually there that that others could sort
Speaker 1: of take from sort of and sort of I and
Speaker 1: sort of maybe poke poke poke away. But I yeah, sorry,
Speaker 1: I just want to rid a little because yeah, I
Speaker 1: didn't know. It's it's it's it's a great I I agree, yeah,
Speaker 1: you know, I think I think that would be great. Um,
Speaker 1: I do think that it would be scary, uh, too
Speaker 1: scary for the labels. So while I love love that
Speaker 1: idea and hope that they do it, I think it's
Speaker 1: far fetched right now because it's just they're making so much. Yeah, absolutely,
Speaker 1: oh yeah, I mean they pretty much make the call
Speaker 1: on if anything changes. I think they think that they're
Speaker 1: doing enough, at least for the songwriters. I mean, I
Speaker 1: know you've seen they had secret genius before. Um they
Speaker 1: have notable now where they post your picture as a
Speaker 1: songwriter or producer on a billboard and say, wow, look
Speaker 1: at this person. Um. But and while that's great because
Speaker 1: it gets you exposure, it still isn't enough. And I
Speaker 1: mean to think of how much money they're spending to
Speaker 1: do that, where that can really go towards other things
Speaker 1: are helping helping us in a different way, like pay
Speaker 1: our rent. That's the other thing about this that I
Speaker 1: find hard to get my head around, and I assume
Speaker 1: most casual music fans find they're hard to get their
Speaker 1: head around, is just how complex the environment is. It's
Speaker 1: really hard to figure out how people get paid and
Speaker 1: why they get paid, and even people in it are
Speaker 1: confused by it, and people on the outside just I
Speaker 1: think glaze over a little bit um, which is a
Speaker 1: shame because I think, honestly, if fans really knew what
Speaker 1: was going on, they would do you know, if they
Speaker 1: knew that they could directly support the artists that they love,
Speaker 1: I think they would do it. You know, I I
Speaker 1: really knew um. In this podcast, we do a single
Speaker 1: guest up front for a kind of facts of the case,
Speaker 1: and then we do this roundtable, and our first guest
Speaker 1: was an artist named Blake Morgan. Blake had an idea
Speaker 1: that I wanted to run by both of you, which
Speaker 1: is essentially get rid of the free layer at Spotify,
Speaker 1: because his perspective was, you can't say that you're trying
Speaker 1: to help artists make a living and give their music
Speaker 1: away for free. Those two things just don't go together. Yeah, yeah,
Speaker 1: you agree with that. Oh yeah, yeah, I definitely understand
Speaker 1: the sort of economic need for getting rid of the
Speaker 1: free layer. As a consumer, I guess I started to
Speaker 1: feel a little like, oh man, I kind of like
Speaker 1: being able to like just go find a song, but
Speaker 1: I won't listen to for free. But that's also something
Speaker 1: that like, hey, I remember before YouTube, so I do
Speaker 1: remember what it was like before that was the case,
Speaker 1: and like it was fine. I don't know, there is
Speaker 1: something to be said about like music not being always
Speaker 1: at once aingo tip, where the songs can sometimes have
Speaker 1: a sort of different life and a different residency in
Speaker 1: your life rather than it's like, oh I always have
Speaker 1: immediate access to this thing. So yeah, I feel like that.
Speaker 1: Um that era, the Lime Wire era, where it was
Speaker 1: like we were just able to download anything at any time. Um,
Speaker 1: we kind of got caught into that mindset of like,
Speaker 1: well I could just listen to it somewhere else for free,
Speaker 1: and um, we're just not taking into consideration like the
Speaker 1: the people that it affects effects, you know, It's it's
Speaker 1: a hard thing. Once once a habit has taken hold
Speaker 1: with people and that and like a habit, like oh yeah,
Speaker 1: music is free. It's really really hard to break that habit. Again.
Speaker 1: That's happening sort of throughout the world. Not to get
Speaker 1: too philosophical, but we live in the modern world in
Speaker 1: a way in which things are convenient and we do
Speaker 1: them because they're convenient and they're easy, and we're starting
Speaker 1: to learn that things that are convenient and easy aren't
Speaker 1: necessarily good for the world. It's like, oh, I threw
Speaker 1: away my water bottle because it was easy, but it
Speaker 1: wound up in the middle of the Pacific Ocean, and
Speaker 1: so paying artists for music should fall into the same category.
Speaker 1: It's like, free music has an impact on people's lives,
Speaker 1: you know. Maybe one thing that Spotify could do is
Speaker 1: just do a better job of educating people about that
Speaker 1: and really take an artist centric point of view on
Speaker 1: making sure that people understand that there are implications for artists,
Speaker 1: you know, and what those implications are. I mean, one
Speaker 1: of the other questions I had for both of you,
Speaker 1: I was looking on there's a service called Music Gateway,
Speaker 1: and it allows you to compare what you would make
Speaker 1: for a set number of streams as an artist on Spotify,
Speaker 1: on a title on Pandora, on Amazon and Apple. So
Speaker 1: I did this math right? The bottom edge of what
Speaker 1: we consider to be the middle class in America is
Speaker 1: thirty thousand dollars a year. I would say that's a
Speaker 1: little stingy, but let's say thirty thousand dollars a year.
Speaker 1: To make thirty thousand dollars a year on Spotify, you
Speaker 1: would have to get about seven and a half million streams.
Speaker 1: Right now, fifty two thousand, six hundred artists are making
Speaker 1: ten thousand dollars or more on the platform, so it's
Speaker 1: not even thirty thousand. So they've got a long way
Speaker 1: to go to help. You know, a million artists make
Speaker 1: a living off the platform. But the other interesting thing
Speaker 1: was for the same number of stream on Apple, I
Speaker 1: would make thirty seven thousand, five hundred dollars on Amazon
Speaker 1: the same on Title I would make ninety thousand bucks
Speaker 1: off of seven million, five hundred thousand streams. So Title
Speaker 1: stands out. So I guess the question there is why
Speaker 1: didn't Title do better? Uh? One, there's already the amount
Speaker 1: of conversation when titled, so to enter the space I
Speaker 1: think it entered around um so Spotify had already existed.
Speaker 1: YouTube YouTube have been around since the mid two thousands.
Speaker 1: Spotify had sort of come into the United States and
Speaker 1: in the early and it into the mobile platform in
Speaker 1: the mis um Apple Music it was also launching around then.
Speaker 1: You still had people that are using Pandora and higher amounts,
Speaker 1: and when titled only real again differentiation factor or more
Speaker 1: like sort of like aesthetic things of like again like
Speaker 1: twenty out producers and songwriters and stuff like that, that
Speaker 1: just wasn't not to differentiate it when it's overall content
Speaker 1: with the same content, it's basically every other platform and
Speaker 1: title did try to have this clues an album for
Speaker 1: like a very brief good of time in early and
Speaker 1: I think maybe in sen but they kind of moved
Speaker 1: away from that when artists realized that putting your music
Speaker 1: only on one platform really limits the audience potentially, right
Speaker 1: makes sense. One of the other observations that I have
Speaker 1: is like I have no context for what artist should
Speaker 1: be paid per play. It's like minimum wage raising the
Speaker 1: minimum wage. Everybody knows roughly what that means, and so like,
Speaker 1: do either of you have an opinion about, like what
Speaker 1: is the right number per stream that artists should be
Speaker 1: paid in order to create a more fair deal for them.
Speaker 1: So I would love to know, um, what the labels
Speaker 1: are getting per per stream um. And that's what makes
Speaker 1: it hard. If if I could see those those receipts, yeah,
Speaker 1: I would be right. And back to this transparency issue, right,
Speaker 1: it's all a big secret, like what's go went on? Um,
Speaker 1: Maybe that would be a thing that Spotify could advocate
Speaker 1: for that everybody know what everybody's making. Like that would
Speaker 1: be a huge step forward, wouldn't it. Yeah, it was
Speaker 1: the only issue because I remember talking some about this
Speaker 1: very recently, is that, like it wouldn't behoove the labels
Speaker 1: to have that that knowledge out there because then your
Speaker 1: conversation undercut you or sort of undermine some of the
Speaker 1: stuff that you're trying to do. Yeah, no, it's hard, right,
Speaker 1: they would definitely resist that. But but if there was
Speaker 1: just like I like I've been saying, and even playing
Speaker 1: field where the artists get what they get and it's
Speaker 1: not it doesn't have to be a private negotiation, well
Speaker 1: maybe it could be. Yeah, it could be aggregated and anonymised. Right,
Speaker 1: So you don't know exactly what the deal between Sony
Speaker 1: and and X is, but you know that ultimately Sony
Speaker 1: is getting about this amount. Okay, my last question for
Speaker 1: for both of you. Spotify says its purpose is to
Speaker 1: give a million artists the opportunity to live off their art.
Speaker 1: And as I said before, the fact is only fifty
Speaker 1: two thousand, six hundred artists generated ten thousand or more
Speaker 1: last year on Spotify, so they've got a ways to
Speaker 1: go before they get to a million artists. We have
Speaker 1: a tool on this show called the BS index, which
Speaker 1: measures the gap between word indeed, and it goes from
Speaker 1: zero to one hundred, zero being the best, zero bs
Speaker 1: one being the worst total BS. What score would each
Speaker 1: of you give to Spotify? David, I'm gonna ask you
Speaker 1: to go first on this one. I think my answer
Speaker 1: to the original question on public I put slight into
Speaker 1: what I'm about to say, but it would have to
Speaker 1: be one D because having a million a million people
Speaker 1: also ten thousand is not also like, that's not like,
Speaker 1: I mean, that's not no, that's not making a living.
Speaker 1: That's no, no, no, that's not I also want to
Speaker 1: like to be like I think it's kind of said
Speaker 1: as earlier that like even thirty or party thousand, if
Speaker 1: you're living in a major that's minimum ways. Yeah, yeah,
Speaker 1: that is more than likely a lot lot lower, so
Speaker 1: I would go, like a hundred. Okay, alright, I'm a
Speaker 1: hundred percent with you. It's it's on a hundred. I
Speaker 1: think they have plenty of ways to change this model,
Speaker 1: and I think they know their power and they're using
Speaker 1: the well what if what if we lose listeners? What
Speaker 1: if we do this? I mean everyone I know uses Spotify, So, um,
Speaker 1: I think they know their power. I don't think the
Speaker 1: consumers are going anywhere. I think using the fact that
Speaker 1: they can put more awareness out there and essentially become
Speaker 1: an ally and if they can really be a voice
Speaker 1: for us, I think that would also translate into even
Speaker 1: more consumers and more listeners and more supporters. Um so yeah,
Speaker 1: m hm. This has been a fantastic conversation at David Cadence.
Speaker 1: I want to thank you both for being here today.
Speaker 1: It was wonderful to have you on the show. Thank
Speaker 1: you for having us, Thank you, thanks so much for
Speaker 1: inviting Alright, folks, it's time to rate Spotify on the
Speaker 1: B S scale. Spotify is certainly not giving a million
Speaker 1: artists the opportunity to live off their work. All three
Speaker 1: of our guests gave really high scores because of this,
Speaker 1: and to one hundreds and that perspective totally makes sense.
Speaker 1: Spotify has done little to provide artists with a living wage,
Speaker 1: and there is so much more they might do to
Speaker 1: support artists in a meaningful way, for instance getting rid
Speaker 1: of their free tier or redistributing payment based on individuals
Speaker 1: actual listening habits. However, their tools do provide artists with
Speaker 1: valuable audience metrics, and they have created a great platform
Speaker 1: to get traction if you're a musician. That's not nothing
Speaker 1: far from it. So today I'm giving Spotify a seventy
Speaker 1: two and Spotify CEO Daniel Eck if you'd like to
Speaker 1: come on the show to talk about anything we've touched
Speaker 1: on today, Please know that you have an open invitation.
Speaker 1: If you're thinking about starting a purpose led business or
Speaker 1: beginning the journey of transformation to become one, here are
Speaker 1: three things you should take away from this episode. One,
Speaker 1: make sure your purpose and your business model are aligned.
Speaker 1: Free is never free. I feel like I've said this before,
Speaker 1: it's still true. When you sign up for Spotify's free level,
Speaker 1: somebody pays, even if it's not you. In Spotify's case,
Speaker 1: it's the artists who you love and who Spotify claims
Speaker 1: to want to help make a living who paid the price.
Speaker 1: If you are going to make your product free, make
Speaker 1: sure you're transparent about your business model and that it
Speaker 1: aligns with your purpose. Two. Your purpose must drive action.
Speaker 1: If you can't make meaningful strides towards delivering on it,
Speaker 1: then it's not your real purpose. If Spotify's hands are
Speaker 1: actually tied by the record labels, as it seems like
Speaker 1: they may be, they need to figure out how to
Speaker 1: advocate on behalf of the musicians they claim to care
Speaker 1: about to change that situation or change their purpose to
Speaker 1: accurately reflect what they really stand for. Three. Become a
Speaker 1: force for transparency in your chosen industry. Transparency about your
Speaker 1: own businesses table stakes. If your purpose led but purpose
Speaker 1: led businesses are actually trying to make the whole world
Speaker 1: a better place, and better things happen in light than
Speaker 1: in shadow. In Spotify's case, it's actually super hard to
Speaker 1: know how to help them help artists because it's very
Speaker 1: hard to understand where the money is going in the
Speaker 1: music industry. They should try to fix that. And if
Speaker 1: this episode made you want to sing our praises, subscribe
Speaker 1: to the Calling Bullshit podcasts on the I Heart Radio, app,
Speaker 1: Apple Podcasts, or wherever you listen to people speaking to
Speaker 1: your ears and friends. I'd like to ask for your help.
Speaker 1: If you enjoy the Calling Bullshit Podcast, please take a
Speaker 1: second to rate us on Apple Podcasts or on your
Speaker 1: preferred platform. It helps more people find the show. Thank
Speaker 1: you to our guests today, Blake Morgan, Cadence and David Turner.
Speaker 1: Learn more about the I Respect Music campaign, the Centers
Speaker 1: and David's newsletter Penny Fractions in our show notes or
Speaker 1: at our website Calling Bullshit podcast dot com. And thanks
Speaker 1: to our production team Hannah Beale, Amanda Ginsburg, d s Moss, Hailey, Pascalites,
Speaker 1: Parker Silzer and Basil Soaper. A little bit of good news,
Speaker 1: we recently learned that we are now the eleventh most
Speaker 1: popular business podcast in the world. Kick Ass Job Team.
Speaker 1: Calling Bullshit was created by co Collective and it's hosted
Speaker 1: by me Time Montague. Thanks for listening.