Should Unsigned Bands be on Spotify?

Citing a drastic drop in record sales in territories where Spotify has launched, Century Media Records and its associated labels have decided to pull their entire catalog from Spotify. Instead, it will be replaced in the future with samplers from their artists.

Here is their full statement:

Century Media and its associated labels “InsideOutMusic”, “Superballmusic”, “Ain’t no Grave Records”, “Hollywood Waste” and “People Like You” have decided to pull their repertoire from Spotify in an attempt to protect the interests of their artists.

While everyone at the label group believes in the ever changing possibilities of new technology and new ways of bringing music to the fans, Century Media is also of the opinion that Spotify in its present shape and form isn’t the way forward. The income streams to the artists are affected massively and therefore that accelerates the downward spiral, which eventually will lead to artists not being able to record music the way it should be recorded. Ultimately, in some cases, it will completely kill a lot of smaller bands that are already struggling to make ends meet.

At the same time Century Media also believes that Spotify is a great tool to discover new music and is in the process of reintroducing their bands to Spotify by way of putting up samplers of the artists. This way, fans can still discover the great music released by the label.

Physical sales are dropping drastically in all countries where Spotify is active. Artists are depending on their income from selling music and it is our job to support them to do so. Since the artists need to sell their music to continue their creativity, Spotify is a problem for them. This is about survival, nothing less and it is time that fans and consumers realize that for artists it is essential to sell music to keep their heads above water.

Obviously it is ultimately up to the music fan and consumer, how they access their music, whether it is buying, streaming or stealing. There needs to be awareness though, that how you will consume your music has direct consequences for the artists, who we are all trying to support.

So, based on their statement do you agree with this decision? One misconception I’ve seen about Spotify is that it’s a music discovery tool, when it’s not at all. There’s no “radio” feature and the only way to stumble across something is if that artists happens to share a song title, album title or something else that would make them show in the results for your search for something else. Otherwise you’d have to know what you’re searching for or see a recommendation from a friend, so you could say it’s pretty much like Facebook, but with less users.

Once somebody does know you’re on Spotify, the royalty rates aren’t going to pay any of your bills to say the least. So then what? Let’s say you land a spot on a good tour (maybe even had to buy on), and you play a killer set in front of a good crowd. What would happen is that somebody really impressed would come back to the merch booth and want to buy a CD from you. It’s in that critical time period where the consumer’s mind is in “want it now” mode, because statistically the further removed that person gets from that scenario, the less likely he/she is to purchase your album (for example, if you didn’t have albums there, they might intend to get it from iTunes later that night or the next day, or buy it from a store, only to change their mind).

If your music is on Spotify, what potentially changes? I haven’t heard of it happening yet, but in the future I see you playing that same killer set, but that fan pulling a smartphone with Spotify on it out of their pocket, searching your band name and saying “oh, I have this album!” In this sense, it changes “I want it” (which puts money in your pocket and gas in your van) to “already have it, don’t need to buy it” (which will get you a couple fractions of a penny).

Century Media’s solution sounds like a fantastic compromise, and I’m glad they came up with it. I hadn’t even thought of that option myself. Putting samplers or just a few tracks on Spotify allows you to have the same amount of potential discovery or presence, without killing off a band’s main source of revenue.

What do you think?