Spotify Reacts On Accusations

Less than 12 hours after yesterday’s post, Spotify-CEO Daniel Ek, on the company’s news blog, posted his reaction to the various accusations the company is hitting hard..

From Taylor Swift, who pulled all her music from Spotify, and consequently scored the ONLY platinum album in the US this year, to music manager/consultant Jack Ponti, whose detailed explanations about Spotify’s IPO-plans we posted yesterday – the discussion is currently heating up.

Meanwhile, media outlets zoom in on Daniel Ek’s background with uTorrent, a major driver of piracy, as pointed out by Edward Felten, a professor of computer science and public affairs at Princeton University, and Chief Technologist for the United States Federal Trade Commission..

Here’s Jack Ponti’s take on Daniel Ek’s post:

Daniel Ek (CEO Spotify) quotes in Italic Style

vs.

JACK PONTI’S REPLIES IN CAPS AND BOLD

Ek (Spotify): Here’s the thing I really want artists to understand: Our interests are totally aligned with yours.

PONTI:  OK, I SUGGEST YOU TAKE A 20% EQUITY POSITION AND ALLOW THE ARTISTS TO OWN THAT AND SHARE IN THE UPSIDE OF THE IPO

In answer to this ridiculous press release from the boy wonder.  Lefsetz style caps.

We started Spotify because we love music and piracy was killing it.  

ANYONE WHO STARTS A BUSINESS DOES SO TO MAKE MONEY.

Quincy Jones posted on Facebook that “Spotify is not the enemy; piracy is the enemy”.

WE KNOW THAT QUOTE WAS GOING TO RETURN, Q ALSO HAS EQUITY. SHUT UP.

A billion dollars from the time we started Spotify in 2008 to last year and another billion dollars since then. And that’s two billion dollars’ worth of listening that would have happened with zero or little compensation to artists and songwriters through piracy or practically equivalent services if there was no Spotify

YOU’RE FORGETTING TO SHOW THE MATH AND HOW INFINITESIMAL AND INSULTING IT IS.

When I hear stories about artists and songwriters who say they’ve seen little or no money from streaming and are naturally angry and frustrated, I’m really frustrated too. 

BECAUSE THAT HURTS YOUR PRESS SPIN, YOU LYING FUCK.

As I said, we’ve already paid more than $2 billion in royalties to the music industry and if that money is not flowing to the creative community in a timely and transparent way, that’s a big problem.  

SUBLIMINALLY TRYING TO DIVERT THE BLAME TO THE BIG BAD RECORD COMPANIES.

We’re trying to build a new music economy that works for artists in a way the music industry never has before. And it is working – Spotify is the single biggest driver of growth in the music industry, the number one source of increasing revenue. 

ALL WE NEED TO DO IS SHOW SPOTIFY ROYALTIES AGAINST ROYALTIES FROM ANY PRO TO SHOW THIS IS ABSOLUTE BULLSHIT.  STREAMING NUMBERS MIGHT BE INCREASING BUT THEY ARE STILL A FRACTION OF INCOME.  THAT IS A PAINTED PICTURE TO TRY TO SAY SOMETHING THAT IS A FALSEHOOD.

Today, people listen to music in a wide variety of ways, but by far the three most popular ways are radio, YouTube, and piracy – all free. 

EXCEPT RADIO PAYS HIGHER ROYALTIES THAN SPOTIFY AND YOUTUBE PAYS A TON IN ADVERTISING REVENUE. WE JUST DON’T KNOW WHERE IT IS. HELLO, LABELS.

If a song has been listened to 500 thousand times on Spotify, that’s the same as it having been played one time on a U.S. radio station with a moderate sized audience of 500 thousand people. Which would pay the recording artist precisely … nothing at all. But the equivalent of that one play and its 500 thousand listens on Spotify would pay out between three and four thousand dollars. The Spotify equivalent of ten plays on that radio station – once a day for a week and a half – would be worth thirty to forty thousand dollars. 

AND THERE IS THE ENTIRE, ERRONEOUS, BULLSHIT ARGUMENT AT HOW THEY DERIVE THEIR MATH. FIRST OFF, DOUCHE, YOU WILL GET PAID FOR THAT SPIN. SECONDLY A RADIO AUDIENCE CUMULATIVE IS WHAT THE SIZE COULD POSSIBLY BE BASED ON REACH AND LISTENERS. HOWEVER YOU LYING LITTLE BITCH, ALL 500K LISTENERS ARE NOT TUNED IN AT THE EXACT SAME TIME OF THAT SPIN.

Now, let’s look at a hit single, say Hozier’s ‘Take Me To Church’. In the months since that song was released, it’s been listened to enough times to generate hundreds of thousands of dollars for his label and publisher 

I WOULD LOVE TO SEE THE STATEMENT ON THAT, FIRST OF ALL.  SECONDLY, HOW MUCH HAS BEEN TO HIM? NOT TO THE LABEL OR PUBLISHER, BUT TO THE ARTIST. ALSO TELL US THE WRITER ROYALTY.

Except the whole correlation falls apart when you realize a simple fact: downloads are dropping just as quickly in markets where Spotify doesn’t exist. Canada is a great example, because it has a mature music market very similar to the US. Spotify launched in Canada a few weeks ago. In the first half of 2014, downloads declined just as dramatically in Canada – without Spotify – as they did everywhere else. If Spotify is cannibalising downloads, who’s cannibalising Canada? 

CANADA AND THE US ARE VERY DIFFERENT MARKETS, BUT YOU WOULDN’T KNOW THAT, IKEA BOY.  I CAN EASILY SAY THAT SINCE I HAVE SWITCHED FROM WINE TO LIQUOR, DOWNLOADS ARE SEEING ATTRITION, THEREFOR I CAN SAVE THE MUSIC BUSINESS BY GOING BACK TO WINE.

By the same token, we’ve got a great list of artists who promoted their new releases on Spotify and had terrific sales and lots of streaming too – like Ed Sheeran, Ariana Grande,Lana Del Rey and alt-J. Artists from Daft Punk to Calvin Harris to Eminem had number ones and were on Spotify at the same time too. 

BECAUSE
1) THE LABELS HAVE AN EQUITY STAKE IN YOUR COMPANY.
2) LABELS NOW EMPLOY CHILDREN IN MARKETING DEPARTMENTS, NOT SKILLED ADULTS.
3) ARTISTS WHO HAD NUMBER ONES ALSO HAD NUMBER ONES AT RADIO AND SHAZAM, SO WHAT ARE YOU SAYING?

Here’s the thing I really want artists to understand: Our interests are totally aligned with yours.

OK, I SUGGEST YOU TAKE A 20% EQUITY POSITION AND ALLOW THE ARTISTS TO OWN THAT AND SHARE IN THE UPSIDE OF THE IPO, JUST LIKE THE LABELS WILL.

We don’t use music to drive sales of hardware or software.

TAKING A SHOT AT APPLE? HEY, I HATE APPLE, BUT
1) YOU WILL NEVER BECOME APPLE.
2) YOU WILL NEVER DO THE BUSINESS ITUNES HAS.
3) WHOEVER WRITES YOUR PRESS RELEASES REALLY ATTEMPTS TO USE SUBLIMINAL SWIPES THAT WOULD ONLY WORK ON 9 YEAR OLDS.

We’re getting fans to pay for music again. We’re connecting artists to fans they would never have otherwise found, and we’re paying them for every single listen.

AGAIN? LIKE IT COMPLETELY STOPPED AND YOU ARE A SAVIOR?  FOUND HOW? YOUR GROOVY LITTLE PLAYLISTS THAT A TINY AMOUNT OF PEOPLE SUBSCRIBE TO? WHAT ARE YOU NOW, DICK CLARK?  YOU’RE PAYING NEXT TO NOTHING.
ALL YOU, AND YOUR TEAM, GIVE A FUCK ABOUT IS THE IPO.
PROVE ME WRONG, ASSHOLE.

About the author

Jack Ponti is an American musician, songwriter, record producer, manager, label executive, and consultant (with an estimated 100 million plus records sold worldwide). Jack Ponti posted this November 11 on a closed Facebook Group called « So You Really Want To Learn About The Music Business? » and asked the group members to spread his post. (Screenshot at the end of the page)