One might think that, just weeks after his company scraped through the biggest crisis of its existence — its stubborn defense of giving a gigantic international platform, not to mention more than $200 million, to Joe Rogan and his destructive, malignant opinions — Spotify’s Daniel Ek might exercise a little caution and humility.
One might think that, after paying millions to Capitol Hill lobbyists in an ongoing battle to pay less to songwriters — the very foundation of his company’s existence — than the Copyright Royalty Board decreed it should pay, he wouldn’t spend a reported $310 million on something as flashy and business-uncritical as sponsorship of a soccer team, especially with Russian bombs killing hundreds of Ukrainian civilians every day. But one would be wrong.
Spotify’s flamboyant announcement of its “partnership” with FC Barcelona, which it touted as a groundbreaking connection between sports and music but seems to amount to some names on jerseys and a stadium — was unveiled Tuesday with the same fanfare that it gives new product announcements or yet another “service” for artists like those gigantic, expensive Times Square billboards that advertise stars who don’t need the exposure. And while the company claims that there will be multiple benefits for artists who will be advertised on the team’s jerseys — that’s certainly the first place many people go for music recommendations: a European soccer player’s chest! — it’s all justification for what everyone except one person must know is a questionable investment for a company that loses dozens or hundreds of millions of dollars every year.
And yes, it’s easy to take shots at a big target, but could he make it much easier? Spotify is a great product: It is the world’s largest paid subscription service by far and it is no understatement to say that it saved the music industry by achieving the near-miraculous feat of convincing — through ease of use, a nearly bottomless catalog and, not least, savvy marketing and industry politicking and business incentives — a generation to pay for music that had grown up thinking it should be free. (Disclosure: I have been a Spotify subscriber since it launched in the U.S. nearly 11 years ago, and yes, I pay for it.) That money is a pittance compared to what CDs generated, but it’s turned 15 years of downturn into seven solid years of growth. It is a creation on the level of the Walkman and iTunes — arguably bigger. And it has been led by Ek every step of the way.
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But too often, with success comes overconfidence that quickly turns into hubris. The company stumbled badly in 2018 by attempting to be on the right side of history and banning R. Kelly from its playlists — until they realized he actually hadn’t been convicted of any crimes yet and, oh, we have lots of music by convicted murderers like Phil Spector on our playlists. After some hemming and hawing, Ek backed off of that approach, admitted “We rolled this out wrong” and (apparently) quietly kept the ban in place but just didn’t talk about it.
But the company’s assault on songwriters’ income — in concert with competing platforms YouTube, Amazon and Pandora — is mind-boggling hypocrisy: Not only is Spotify built on songs, it is fully aware that songwriters’ livelihoods have been decimated in the past two decades, and yet they’re undertaking a multimillion-dollar, years-long campaign to pay songwriters less. “We love songwriters!” they say. “Look at our songwriters hub with pages and playlists we’ve made for them!” Swell — try finding a songwriting credit on Spotify. It’s there, sure; just click on the song… then find the three dots on the far right and click on those… and then scroll down and click on “show credits.” Voila!
And while Ek spoke of his “own reflections” on the Rogan controversy and presumably heard the fervent objections from his own staff, ultimately he decided to put a few safeguards in place and stay his course.
And those are just two particularly sore points. We could go on about the low royalties that all streaming services pay to musicians, but in truth, that is less on the streamers than the record labels (which, to be fair, could allocate some of the overwhelming percentage of royalties they take to songwriters and publishing companies, many of which they own). We could talk about the unfairness of that payment system, which is based on “stream share” — i.e. the infinitesimal percentage that an artist or song has in the total number of annual global music streams (which is why Drake and Taylor Swift make millions from streaming while most musicians make a pittance). But those are all separate conversations not limited to Spotify, although it is the global leader.
There’s a scene in “Mad Men” where Don Draper says, “If you don’t like what’s being said, change the conversation.” Ek presumably did not like what was being said about Rogan at all, and it’s possible that this foray into football is an attempt to change that conversation. But there’s also a scene in the TV series “Silicon Valley” where some product isn’t working properly for users and the publicist, Monica — who is usually the smartest person in the room — says to the head of the company, “Did you run this by anyone who isn’t an engineer?” and is met with “Uuuuhhhh…” Does Ek consult or confer with anyone who isn’t just like him, or on the payroll?
This Barcelona FC partnership probably isn’t even really that big of a deal, in the scheme of things. And it’s not as if the No. 2 streaming service, Apple, which continually makes “product updates” that mean you have to spend more money on Apple products like adapters, is a more appealing option. But the timing, optics and what it signals show a shockingly blithe lack of self-awareness that, evidently, goes all the way to the top.
So read the room. The Joe Rogan controversy nearly upended your company, united even more of a largely alienated music community against you, and had much of your staff in open revolt — and you got through it by the skin of your teeth. Now you’re spending hundreds of millions on a curious football partnership, along with those plush, mostly empty offices and Times Square billboards and heaven knows what else, instead of paying songwriters. So be proud of the Barcelona FC partnership and the Rogan numbers and all the rest of it … but remember what pride usually goeth before.
