Taylor Swift Pulls Her Catalog from Spotify

Just recently 24-year-old pop star Taylor Swift pulled her entire catalog from Spotify.  Spotify is a digital music streaming service that provides listeners with millions of songs at their fingertips. Despite the fact that, fans enjoy Spotifiy’s services, artist is not happy.  Taylor Swift has vocally voiced her opinion in numerous interviews. Taylor Swift is convinced that music-streaming services don’t value her art. (Business Insider, 2014) At the same time, Taylor Swift is certain that Spotify could hurt music sales. Her argument that Spotify could hurt music sales is supported by the fact that artist are not even making half of what they could make from an album sale.  Retail sites such as iTunes offer artist albums for $9.99, while Spotify provides artist a payment of $.007 per stream. Essentially, this proves that this model undervalues the artist worth. Even more importantly it’s showing the direction of where the music industry is heading. As consumers demand for digital streaming services increase it makes it more difficult for artist to make a profit from their works. Granted the IFPI views the digital download model as a  “ key revenue stream”, digital downloads are declining. In the last year the IFPI stated “ Revenues from downloads globally fell slightly by 2.1 percent in value, the decline being offset by increases in streaming and subscription revenue”. Obviously it is clear that the streaming and subscription model is here to stay. Nevertheless in today’s mixed economy of revenue streams Taylor Swift should be able to find a solution to her problem with Spotify.

At the same time Taylor Swift should also confront Universal Music Group about the financial terms of her royalties. Granted Spotify may have made a payment to her label the head of the label takes a proportion as well due to their overhead costs.