Recently Spotify tested a new feature allowing record labels to pay for promotions in the U.S. And will be expanding its availability very soon. Spotify is a very popular music streaming service that will allow artists to reach out to their fans.
Critics are worried that the advertising policy will only help major record labels and established artists. This could harm smaller artists who do not have the finances to buy ads.
According to Music Business Worldwide, Spotify will include their pop-up ad “Brand New Music For You” letting users know about new releases based on their choice of music. The service will only allow record labels to ping frequent listeners who have followed a particular artist.
Premium users will be able to disable the notifications if they choose to.
In a recent press release, Spotify said they will allow artist teams to pay to sponsor their recommendations so they will be able to inform their listeners across their Free and Premium categories about their new releases.
Even though this sounds like a great thing for listeners to get the latest updates, others have been quite critical about giving more power to the wealthier artists.
Critic and author Ted Giola said this is like Payola which was an illegal practice for bribing radio stations or other broadcast venues to get a chosen song into their regular rotation.
It seems this practice makes it very difficult for independent artists and labels to have the same form of impact that major labels with big budgets will have.
Founder and owner of the independent label Don Giovanni Records, Joe Steinhardt, told Newsweek that even though the platform will make major label advertising more transparent, you are talking about a platform with ad space being sold to the highest bidder such as Facebook or Instagram.
The highest bidders are not going to be independent labels.
Even though Spotify claims they will only notify frequent listeners, Steinhardt is skeptical. He believes they can put ads on smaller more niche independent artists for the major label sound-alike counterparts which will only erode whatever talent advantage the independents have over major labels.
Producer and author of “Get More Fans; The DIY Guide to the New Music Business”, told Newsweek that Spotify usually shows preference to the major labels over independent labels. They have given special access for features to major artists or larger independent artists, leaving the DIY artists in the dust.
There was a time when the streaming service was a symbol of hope for young artists without large labels. Now that seems to be fading away. The major label preference on Spotify who features only the most visible spots is disappointing.
They do not make this accessible for indies making the trend of streaming services only supporting artists who work with major labels instead of helping by leveling the playing field, It should be a more favorable environment for artists who do not want to be a part of the major labels so they can reach larger audiences.
Steinhardt said there are some positive aspects to the announcement, it could be a positive step toward transparency. Cannon said this could conceivably be a great way for smaller artists to effectively alert their audience for new tracks.
Both Steinhardt and Cannon have compared their announcement to the changes that social media platforms have undergone. Like Facebook, Spotify has promoted the concept of musicians bringing their audiences to follow them on their platform.
The reward for their help growing their platform is paying for access to communicate with the audiences they helped the service build.
Jessi Frick, owner of Father/Daughter Records told Newsweek that she doesn't think it's going to change much for smaller artists. If anything, it will just be another reason for artists to focus on building their fan bases on social media, at shows, and their mailing lists.
To date, Spotify has not been available for comment.