Come April 23, it’ll be 15 years since the founding of Spotify. It wasn’t the first streaming company–that honour belongs to Rhapsody who signed on in 2001–but Spotify is the 800-pound gorilla in the space with over 160 million playing subscribers in 178 counties. Today, 60,000 new tracks are uploaded to the platform–and that number continues to climb. Its market cap is around US$56 billion, almost three times that of the planet’s entire recorded music industry.
Artists continue to hate Spotify, blaming it (and other platforms like it) for destroying their livelihoods with meager payouts. One stat says that artists have a 0.2% chance of generating $50,000 a year. All the cash is going to the top streamers, leaving almost nothing for those below. Physical music sales, traditionally something with better profit margins for artists, have been irreparably crushed by the rise of streaming.
At the same time, streaming has saved the music industry from itself. When the company first went live in 2008, two years after its founding, record labels were still trying to preserve the old model of selling their product on pieces of plastic while battling the scourge of illegal file-sharing. They hated the idea of streaming. Now, though, they’ve come around. Streaming accounts for well more than two-thirds of the revenues of each of the major labels. And the overhead? Almost nothing compared to the days when they had to manufacture, transport, and warehouse albums, tapes, and CDs.
Check out these numbers from Variety: “How completely has streaming transformed the music world? The platform rose from 7% of the U.S. market in 2010 to a whopping 83% by the end of 2020 — and recorded music revenues saw their fifth consecutive year of growth, topping $12.2 billion, per the RIAA.”
Here are some assorted facts about Spotify and streaming in general.
- Music piracy is way down. If you can get 75 million complete, virus-free songs from Spotify, why go through the trouble of stealing?
- Barriers between genres have broken down. In the past, we were limited in our musical explorations by our available cash. We were loathed to take a risk on a CD from an artist or genre we didn’t know because we might not like it. That would mean wasting money. But with Spotify, we can explore all we want with no risk.
- It’s now about the SONG and not the ALBUM. We’re grazing more than we ever used to.
- And because it’s become about the SONG, we’re now caught up in PLAYLISTS instead of full albums. There have already been many elegies written about the death of the album at the hands of the playlist.
- Playlist curators are the new stars and the most important tastemakers/influencers in music. Get on Rap Caviar for example and you’ve got a real chance of having a hit.
- No more liner notes, album artwork, hidden tracks, B-sides and bonus tracks, and all the other cool things that used to come with physical formats.
- A music stream without context is just organized noise. So many songs go in one ear and out the other without anyone explaining about the song/artist/album/sound/scene that birthed that song.
And most important of all (at least to me), streaming is changing the very nature of songwriting. In fact, I did a TEDx talk on this very thing.
Streaming here to stay. But what will the next 15 years bring. We will watch with interest.