Justice or greed? Spotify stops monetizing tracks from little-known artists

November 22, 22:49 Share:

Spotify is changing its royalty payment system (Photo: Primakov/Depositphotos)

Streaming service Spotify is changing the system of paying royalties to performers. Now there will be no payments for tracks that collect less than a thousand streams per year or do not meet the recording length requirements.

The company says the new policy will prevent monetization of low-quality content, such as white noise and nature sounds.. Spotify notes that attackers who know that users often include this type of content “ for the background” and listen to hour-long playlists, intentionally download shortened versions of recordings to maximize their income. Now “ noise content” can only be monetized if its duration is more than 2 minutes.

“A typical song lasts a few minutes. Some cut audio tracks to 30 seconds and place them in a playlist, which is invisible to listeners, so they make huge money. … The enormous growth of the royalty pool has created a profit opportunity for noise downloaders that far exceeds their contribution to listeners,” Spotify said in a blog post.

In addition, from next year, tracks that have had less than 1,000 plays per year will not receive royalties.. Of the 100 million tracks uploaded to Spotify, tens of millions never crossed that threshold, earning creators an average of $0.03 per month, the company said.. Such small payments often don't reach authors because of bank fees, but the company spends up to $40 million a year on them.

With this in mind, Spotify is going to stop these meager payments and distribute the funds so that more popular artists receive more income.

“There are no changes to the size of the music royalty pool that is paid to rights holders from Spotify; we will simply use tens of millions of dollars annually to increase payouts to all eligible tracks, rather than spreading them out into $0.03 payouts. … [By fixing the problems] we can generate approximately $1 billion in additional revenue for new and professional artists over the next five years,” Spotify says.

The company will also begin to fine authors for distributing tracks using the profit-increasing schemes mentioned above.

“As a new deterrent, early next year we will begin charging labels and distributors per track if their content is found to be egregiously artificial,” the blog states.

Spotify has been criticized before for not paying artists enough.. Now, many artists will get nothing from the platform other than the ability to post their music on its servers.

Read also: Auditions were cheated. Spotify deleted tens of thousands of songs that were written by artificial intelligence. The Swedish regulator fined Spotify

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