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Taylor Swift’s Team Calls BS On Spotify’s Revenue-Sharing Numbers

Spotify said Taylor Swift would have made $6 million this year. But her label reveals that number is much smaller.

Taylor Swift’s Team Calls BS On Spotify’s Revenue-Sharing Numbers
[Photo: Flickr user Eva Rinaldi]

The Taylor Swift-Spotify drama is like a sad country love song scribbled on the back of a napkin. On Monday, a heartbroken Spotify launched back at Taylor Swift with a lengthy blog post, criticizing her for the decision to remove her albums from its music library. The central tenet articulated by Spotify CEO Daniel Ek was that Spotify does pay artists, and if the megastar had chosen to stick with the streaming-music service for the year, Swift was on pace to make $6 million.

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Which sounds like a lot of money, even for someone as wealthy as Swift. (Estimated net worth: $200 million.) But now another voice is chiming in as Swift’s independent record label, Nashville-based Big Machine, is calling out Spotify’s multimillion-dollar claim as nonsense.

In an interview with Time, Big Label CEO Scott Borchetta says that the record label has received $496,044 for “domestic streams of Swift’s music.” (A Spotify spokesperson told the magazine that over the last 12 months, Swift made $2 million globally.) Borchetta, however, claims that the payoff from Vevo is higher than what she earns on Spotify.

Apparently, Spotify’s $6 million estimate was based on monthly payouts before she pulled her albums. The most recent statistics show that while Spotify has 50 million users, only about 12.5 million of them are paid subscribers. Spotify is unwavering in its belief that its free, ad-supported model is crucial to getting users to pay for music again. The free tier is a necessity.

And that’s what Swift takes issue with. It’s why she’s on Rdio, Beats, and other subscription-mandated platforms, but not Spotify. As Swift tells Time:

Everybody’s complaining about how music sales are shrinking, but nobody’s changing the way they’re doing things. They keep running towards streaming, which is, for the most part, what has been shrinking the numbers of paid album sales.

With Beats Music and Rhapsody you have to pay for a premium package in order to access my albums. And that places a perception of value on what I’ve created. On Spotify, they don’t have any settings, or any kind of qualifications for who gets what music. I think that people should feel that there is a value to what musicians have created, and that’s that.

So at this point, it’s a whole lot of finger-pointing and cherry-picking of figures to suit the needs of both camps. But Swift’s strategy to yank her latest album, 1989, from Spotify seems to have worked out well enough. The album sits cross-legged at the Billboard No. 1 spot for the second week in a row, moving 1.287 million copies in its first week. While that strategy might not work for everyone—especially smaller acts—Swift is in rarefied air. She can level the cannons at an easy enemy, make bold proclamations about artistic integrity, and make truckloads of cash, all at the same time.

It’s why Spotify has every right to be defensive about its tiered free-and-premium model. When one of the biggest megastars on the planet intensifies her crosshairs at the core of your business, it sets an ominous precedent should the Kanyes, Beyoncés, One Directions, and Gagas decide to leave Spotify one day, too.

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[h/t: Time]

Editor’s Note: An earlier version of this article stated that “Spotify’s $6 million estimate took into account its presumed growth trajectory.”

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About the author

Chris is a staff writer at Fast Company, where he covers business and tech. He has also written for The Week, TIME, Men's Journal, The Atlantic, and more

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