This is partly a historical artifact songwriting hit its stride in the very early 20th century, before mass distribution of recorded music was even a glimmer in anyone’s eye. And while this is a complex issue with many moving parts, one of the biggest is the law - the market it creates, and the behavior it incentivizes.īut First, How Does Music Copyright Work?Įach track involves not one, but two copyrighted works the recorded performance (the “sound recording”), and the underlying composition (the “musical work”).

In short, experience indicates that a streaming service that plays only music will consistently lose money. It is still unclear whether it will manage to repeat the achievement. Spotify, which has been in the US market since 2011, turned its first profit in 2021. Apple Music and Amazon Music, the second and third largest streaming services by market share, both operate at a loss. But the fact remains that investors (and industry observers) agree that music streaming as a loss-leader - something that incurs a net loss for the service doing it, in the hopes of potentially looping consumers into the parent company’s product ecosystem. Because the industry is notoriously secretive about its financials (a problem in and of itself), raw data is hard to come by. The legal regime around music licensing makes breaking even - let alone turning a profit - nearly impossible. Therefore, Spotify has an incentive to keep people using Spotify - just not for music. The law and economics of music streaming lead to one inevitable result: Spotify pays money when it streams music. That Spotify would stand by a show that consistently undermines vaccines and blithely spreads misinformation is disappointing–but, financially, it’s perfectly predictable. Spotify, for its part, has stood firmly by Rogan. Spotify’s decision to hitch its star to podcaster and font-of-COVID-misinformation Joe Rogan has sparked a wave of pushback from musicians, some of whom–among them Neil Young, India Arie, and Joni Mitchell–have pulled their music from Spotify in protest. Fri, Feb 18th 2022 10:52am - Meredith Rose

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