So, back in the day you would have bought a disc, a digital album, a cassette or even a record. This could have been a ~15€ purchase and then you'd stick that into the playback device of your choice and you'd be good to go. So imagine this: Instead of buying a disc, you pay 13€ bucks to Spotify and listen to Artist A exactly one time. Then, you log off and don't use Spotify for the rest of the month. At the end of the month it's payout time: First things first, Spotify takes a 30% cut for the amazing service they provide you with, and then the remaining 70% should go Artist A, right? That's the fair thing to do, but Spotify is smarter than that.

So.. about Spotify and paying fair royalties. When you listen to music from Artist A, your “listen” is thrown into the pool of all listens out there. This means that if you listen to Artist A once, and you are Artist A's only listener, Artist A will get paid the same as every other Artist on Spotify that had only one listen. Even though you paid the price of what could have been a full CD from Artist A, they now get 0,004€¹⁾ and the remaining ((70% from 12,99€) - 0,004€) now go to Taylor Swift²⁾.

The way this works is that the total amount of money collected from end users is, at the end of the month, distributed to all artists equally, proportional to their share in plays. This isn't about how many plays they got in absolute terms, it's about how many plays they got in comparison to everyone else. Example: If 30% of all plays in a month go to Taylor Swift (completely made up number), she will get 30% of the available money. So, regardless of how much you play Artist A, 30% of your money put into the platform will go to Taylor Swift - unless you try to inflate Artist A's numbers, which is mathematically impossible to do, legally³⁾. That's cool, isn't it? Spotify has - of course by accident - created a zero-sum game that will make everyone pay the big ones while small artists are fighting over the scraps. And the cool thing about not being one of the big artists is that it is essentially impossible to become one, because to do that you would have to the percentage of plays of other artists. If Artist A does somehow win, then that by design means that other artists will get proportionally less plays⁴⁾.

You can imagine this as trying to sell books from your garage, but you only get 0,004€ per book sale because Amazon is selling the other 99,999999999% of books that are being sold, overall. So even if you are a local legend and hold concerts in your hometown with a few thousand listeners from your community, that still only puts you ahead of 0,00000245% of artists on that platform. Therefore you get paid like a 0,00000245%.
Making Spotify a zero-sum⁵⁾ game means that it is - by design of the structure - impossible to win, and upward mobility is limited, regardless of the loyalty of a niche community.

But it gets better! How do we listen to music on Spotify? We get music recommendations, right? Isn't it convenient how Spotify is structured in a way to benefit big artists and, with its algorithm, also gets executive control over who the biggest artists are in the first place? Like, it just so happens that Spotify went out of its way to create a monetization “system” that works like an oligarchy and with its recommendation system also has a major, if not overwhelmingly large, say in who becomes an oligarch? And here is a little, dark secret that you may not even want to know - if they control who most people listen to… they also control who will not be listened to. So, uh, any bets on who we think is not going to get recommended a lot by the algorithm? Because, I think I have the hunch that Spotify will like to use its algorithm to reinforce the rigid and hostile monetization structure.

Because, this isn't so much about the exact names of the oligarchs at the top as it is about keeping the total number of oligarchs low. The goal is closing the door behind yourself so that the top keep earning a lot more than anyone else.

The invisible loser is, always, the local legend. The community rock band. Even renowned bands from your state (especially those). Ask any actual music person who is passionate about their work and wants to immerse themselves and others with their artistic way of self-expression - nobody, nobody likes Spotify. The only reason they use it is because they have to. If you don't, the same thing will happen to you that happens to small, family-run businesses: You get overrun by the monopoly and eventually have to close down. Usurpation is the end game of capitalism.

Satirical, made up strawman person: “But, you know, who cares about local artists, right? Those are all pussies, anyway. If you don't make enough you're not working hard enough. They should improve their music and cut down on unnecessary expenses. Less Netflix, it's a distraction, anyway. I make enough money to pay for a monthly Spotify membership and I get all the service I want. I get the music I care about, I can listen to it at 256kbit/s as opposed to the peasantly 128kbit/s (and can definitely hear the difference), the music I listen to is only from people who actually made it as individuals, so I don't have to listen to the riffraff.”

The problem in reality is, unfortunately, that you and I are riffraff ourselves. The same structural mechanics keeping people from earning livable wages on Spotify is why you and I are barely making any money in real life. If you can buy a Spotify membership you may not be a Taylor Swift, but you definitely enjoy a good amount of Privilege. And, unfortunately, this privilege is required. Good for you that you, as a paying customer, don't have that problem, but for many of us this problem is real. Very real. Some of us have to accept massive cuts in their quality of life if they want to do something as basic as listening to music through Spotify. And this may sound acceptable if you consider that Spotify is a service offered to you, but people have their entire music library on there. If you stop paying for Spotify for whatever reason, then that's it for you (Covid happens? Trump tariffs happen? Inflation? Job loss? Healthcare/Surgery costs? Had to fix your washing machine? Just “didn't get as lucky and were born into a poor household”? Make your pick!). Even the music you downloaded, it's gone, you're fucked. You see, unlike a one-time purchase of a CD where you can just keep listening, not only do you have to pay Spotify a fee equal to the cost of a CD, but the money is also given to Taylor Swift and the CD is ripped away from you if you don't pay the next month.

Spotify controls who gets the money - Spotify controls who gets to be in a position of making money - Spotify controls your access to music. Don't like you? Kicked out. Don't pay their small monthly fee? Kicked out.
You got kicked out? Well bad luck for you, Spotify is a deliberately designed walled garden with no way of migrating to another platform easily. You do anything on Spotify that you care about - for example finding new music or creating playlists - then now that's it: You now have to keep paying Spotify until the end of your life, 13€ per month. If you live another 60 years then you'll be paying 9360€ just to keep being allowed to listen to your music. Does any normal person ever get close to spending anywhere that close on music? My friend, you could buy a car from that and listen to music on any other platform instead. Subscription prices rack up fast. And if you fail to pay, at any time, for any reason, you're now excluded from the party.

And also, you will listen to music the way Spotify wants you to. So you will be using their audio player, regardless of whether you like it, you will not be getting access to the actual audio files to use them in personal/private projects, Spotify controls for you which music they allow or disallow on their platform, and if you want to do anything with their music you will use only the tools Spotify gives you to do it. If their tools don't allow you to do what you want to do, then you're a poor sucker. Out-of-line steppers get slammed. External API's are killed. 3rd party playback support is killed. Everything is kept proprietary so that only Spotify has control over how their product is used⁶⁾. If Spotify changes their tune in the future and becomes more predatory to the consumers, either through monetization practices or restriction of functionality, then you can be outraged for a bit, but then you will go back to paying the membership again, because that's what you'll do anyway. Or, you go the hard route of migrating to a different platform, which was designed by Spotify to be particularly difficult. No inter-compatibility, proprietary standards that others aren't allowed to use, no option at all to change your mind in the future. Once you're in the ecosystem, you're locked into it and if you want out, you will lose everything.

EVEN if you read a page about Spotify online and decide “honestly, yeah, fuck this platform”, you'll probably still think to yourself “well, but how am I gonna migrate away from it? There's no way to export your playlists and all”, which may or may not ultimately make you think that it's not worth the drama. Every good platform has the kind of inter-compatibility needed to leave you with a choice and to give you the data you need to exist and function independently of the platform… but not Spotify⁷⁾.

Uh, what was the justification again? Right! Piracy!

To be fair, it worked for a while - pay ten bucks⁸⁾ a month and get “everything” instantly? Nice! Convenience killed piracy, or at least shoved it into the background. But think about it this way: To executives, piracy is a variable to consider in business, not a matter of ethics where we are trying to “do the right thing” or “care about the artists”. Spotify is piracy’s corporate replacement: Same lack of ownership, same file restrictions, artists get fucked over, except now you’re paying rent to a gatekeeper who decides what music even exists on the platform. And piracy? Well, it is alive and well. It hasn’t died, it just mutated. People still pirate because Spotify locks away files, removes albums without warning, or doesn’t even carry half the music outside the mainstream. The only real difference is that back in the day you stole from the labels; now you pay the labels monthly, and the illusion of legitimacy keeps you from noticing that, functionally, nothing has changed: You still don’t own anything, but now you're paying money for the privilege.

And, the war is truly on. Ever since Spotify came into being there has been a campaign to keep users docile. When I say that I deeply respect Spotify's business, what I really mean is their PR department and how good they are at whitewashing the Spotify brand. Of course you cannot hide your monetization model, but you can pull a lot of strings to prevent that from ever getting too much attention. The PR department at Spotify is so successful it's almost magical. Nobody talks about any of this. Even amongst the artists being systemically discriminated, there is barely any conversation about this stuff⁹⁾. Have we just accepted our capitalistic overlords as a fact of life? At least be mad or something. When we order from Amazon we at least admit that it's bad, that Amazon has serious socioeconomic issues and that you shouldn't buy from there. With Spotify, you are likely to meet someone who accepts that its monetization model is discriminatory, but sees no serious problems with Spotify beyond that. We all have lots to learn from the Spotify PR department.

If you want, continue reading on Spotify (Level 2)