A faction of US musicians has launched a vigorous campaign called "Justice at Spotify," calling for the streaming giant to remit penny-per-stream payouts to artists, among other demands. The United Musicians and Allied Workers Union (UMAW) is crusading for major changes to Spotify's business model, which they contend is responsible for artists being "underpaid, misled, and otherwise exploited" by the company, according to the organization's website.
"As Spotify’s valuation soars, we have seen no increase in our streaming payments," the site reads. "The company’s closed-door contracts and payola schemes ensure that only musicians already on top with extensive resources can succeed on the platform. As COVID 19 economically devastates music workers everywhere, it’s even clearer that Spotify’s existing model is counter to the needs of the vast majority of artists."
While artists continue to experience the pitfalls contrived by the COVID-19 pandemic, many have found themselves dependent on the income generated from streaming in the absence of live music. However, despite Spotify's core goal to give "a million creative artists the opportunity to live off their art," myriad musicians and music producers are in dire straits.
On their website, UMAW organizers note that in order to generate $1 on Spotify, a song must be streamed 263 times. "To put that in perspective, it would take 786 streams to generate enough revenue to buy an average cup of coffee," they wrote. "To pay the median American monthly rent ($1,078) an artist needs to generate 283,684 recurring streams monthly. And to earn $15/hr each month working full time, it would take 657,895 streams per band member."
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Considering Spotify's obstinate nature and extremely convoluted business model, it seems the group is facing a long road. While attainable in theory, the complexities of their demands are difficult to ignore. Complete Music Update shrewdly notes that streaming services generally pay over 65-70% of their revenues to the music industry, so even if they were to entirely relinquish their 30-35% cut, the penny-per-cent payout rate would be highly unlikely for the company to remain solvent. CMU goes on to argue that the crux of the issue is actually low subscription rates, which, if raised, wouldn't increase Spotify's revenue enough to meet UMAW's demands.
You can read the UMAW's full list of demands here.