As one of the biggest players in streaming, Spotify has been clouded in controversy for their payouts. Will artists seek more viable alternatives?
On March 15, hundreds of thousands of people protested on a global scale across 31 different cities in Australia, Europe, Asia, Central and South America.
This comes in the wake of developments made in the form of cryptocurrencies whereby NFTs (non-fungible tokens) have garnered mass popularity throughout the art world in the past few weeks.
The event marked the first time an in-person action against Spotify and its business model has taken place, with organisers UMAW (Union Of Musicians and Allied Music Workers) saying “The company has tripled in value during the pandemic while failing to increase its payment rates to artists.”
As of 2021, Spotify is the world’s biggest streaming platform by number of subscribers, making it a huge stakeholder within the music industry as a platform connecting artists and their fans. Other major players include Apple Music, YouTube Music, Amazon Music, Tidal and more, all contributing to the industry’s mass digitisation over the past decade.
But, with their pitiful $0.0038 payout per stream for artists, Spotify sits with one of the lowest rates of artist payment with fans and musicians calling for fairer deals from the streaming giant.
UMAW says, “We believe that the only way to transform music is to collectively take resources and power from the few wealthy companies that dictate our industry.”
However, in recent weeks a new opportunity for artists and fans alike to sell and purchase one-of-a-kind digital tokens has come in the form of NFTs.
NFTs enable artworks to be ‘tokenised’, creating a digital certificate of ownership that is bought and sold. This is achieved through blockchain technology which underpins other cryptocurrencies such as bitcoin.
This comes at a time where the music industry has seen its value crushed by the likes of COVID and dominant streaming services like Spotify, exploiting the works of artists.
Now with NFTs, a new digital gold mine has been provided in the hopes of offering a new valuable revenue stream.
Recently, Kings of Leon became the first major artist to release a record as an NFT, pricing their digital tokens at $50. This included enhanced media capabilities, digital downloads of the music and a limited edition vinyl.
However, sales of these limited edition tokens only lasted two weeks, as the NFT has now become a tradable collectible in the crypto world, with the remaining unsold records destroyed.
The band generated over $2 million in sales and aren’t the only ones cashing in on the NFT train. By the end of February, Grimes had sold over $5.8 million worth of NFTs and Steve Aoki, DJ and dance phenomenon had also cashed in $4.25 million in digital works.