According to Nile Rodgers of Chic, if David Bowie were starting out in today’s highly competitive music industry, he would not have been given the chance to achieve global success. Labels are more concerned with making a profit rather than developing and supporting unique talent.
The composer and performer who collaborated with Bowie on Let’s Dance, which propelled him into the popular music scene in the 1980s, claimed that contemporary record labels would not have allowed Bowie the time to create a successful record after his previous albums in the 1970s, which were not widely recognized outside of the UK.
“He was given ample time to create a successful song, and when he contacted me, we created [Let’s Dance],” stated Rodgers. “The labels used to take on the financial burden and support the artists they had faith in, hoping they would eventually become successful. However, those days have come to an end.”
In 2021, Rodgers addressed a House of Commons select committee to discuss the streaming economy and how artists and songwriters are compensated. The committee had previously made significant recommendations for a “reset” in the industry to ensure fairness for these individuals.
During the panel discussion, Prof David Hesmondhalgh and Dr Hyojung Sun, who conducted a study on the financial aspects of streaming, and Merck Mercuriadis, who co-founded Hipgnosis, a music management company with Rodgers, all expressed that there has been minimal and sluggish advancement since 2021.
Sun told the committee: “We still have a long way to go before we can say the industry has been reset,” while Hesmondhalgh said that in reality “streaming is a source of income for relatively few people” because of the way profit is distributed.
The committee stated in 2021 that although streaming has resulted in substantial profits for the recorded music industry, the individuals responsible for creating the content – such as performers, songwriters, and composers – are not benefiting. Two years later, the panel maintained that there has been minimal improvement.
According to the committee’s report, streaming services like Spotify receive 30-34% of revenue from each stream. The label receives 55%, while the remaining amount is divided among the recording artist, publisher, and songwriter.
Rodgers illustrated the problems modern songwriters and artists face by comparing today’s streaming remuneration with what he experienced in the 1970s. He told the committee that in 1977 – after his first Chic album sold a million copies – he received $100,000, while Snoop Dogg revealed last week he got $45,000 for a billion streams.
Spotify responded to Snoop Dogg’s statements by stating that the majority of their revenue from music comes from two sources: Spotify Premium subscribers and advertisers on their Free tier. A spokesperson clarified that approximately 70% of this revenue is distributed to music rights holders through a “royalty pool.”
Rodgers rejected the notion that the labels’ assertion of receiving a fair share of streaming revenues is justified due to their significant investments in artists and repertoire (A&R). He expressed frustration with their reliance on this outdated argument, stating that it could easily be considered deceitful.
Sun concurred, stating that the proof did not back up the record labels’ assertions of significant risk-taking. On the other hand, Mercuriadis contended that due to streaming data that identifies fan-favorite songs, labels never took a chance on an artist. He remarked, “The ones that respond are the ones that labels sign. And by then, there is minimal risk because the public has already spoken.”
The committee meeting is taking place a few days after Spotify’s CFO, Paul Vogel, announced his resignation. This comes shortly after he sold $9.3 million (£7.4 million) worth of shares, following the company’s announcement to reduce its workforce by almost one fifth.
Spotify announced that it had a total of 9,400 employees by the conclusion of the third quarter of 2023. This marked the third time the company has reduced its workforce this year, with a 17% decrease. In previous rounds, they had already reduced employee numbers by 6% in January and an additional 2% in June.
Source: theguardian.com
