atoms_amok_packshot_4After a good few months for Spotify in terms of winning over streaming-music holdouts – Pink Floyd and The Eagles most notably – the company could be in for an interesting week. In a not-so-good way.

Atoms for Peace – the band including Thom Yorke, Nigel Godrich and Flea from the Red Hot Chili Peppers – have pulled their albums from Spotify, with Godrich explaining why in a series of tweets.

“Anyway. Here’s one. We’re off of spotify.. Can’t do that no more man.. Small meaningless rebellion. Someone gotta say something. It’s bad for new music,” wrote Godrich.

“The reason is that new artists get paid fuck all with this model.. It’s an equation that just doesn’t work… The music industry is being taken over by the back door.. and if we don’t try and make it fair for new music producers and artists… then the art will suffer. Make no mistake. These are all the same old industry bods trying to get a stranglehold on the delivery system.”

We’ve included the entire series in a chronological Storify at the bottom of this story, so you can see the full flow of his argument. As far as we can tell, the Atoms for Peace albums have been pulled from all streaming services, although (unsurprisingly) they are still easily findable on Grooveshark and YouTube.

Other artists including Ron Sexsmith and Four Tet have chimed in to agree with Godrich already, with Four Tet being particularly blunt: “I had everything on my label taken off. Don’t want to be part of this crap.”

Thom Yorke also weighed in. “Make no mistake new artists you discover on #Spotify will no get paid. meanwhile shareholders will shortly being rolling in it. Simples,” he tweeted. “‘your small meaningless rebellion is only hurting your fans … a drop in the bucket really’ No we’re standing up for our fellow musicians.”

It sounds like he’s keen to bring that debate out into the open, suggesting that “people are scared to speak up or not take part as they are told they will lose invaluable exposure if they don’t play ball”.

Godrich goes on to explain that while he thinks streaming makes sense for big bands with large back catalogues, like Pink Floyd, it’s new artists who he thinks are losing out.

“If people had been… listening to spotify instead of buying records in 1973… I doubt very much if dark side would have been made.. It would just be too… expensive.”

Godrich goes on to suggest that Spotify and rival streaming services need to address the fact that streaming suits catalogue rather than new music by “and change the model for new releases or else all new music producers should be bold and vote with… their feet. They have no power without new music.”

(All the …’s are the end of one tweet and the start of another, by the way)

The debate over Spotify and streaming music payouts has been bubbling away for some time, and we’d point you to our Writing or speaking about streaming music screwing artists? feature for a roundup of other arguments and statistics relevant to the debate.

One interesting point here: Atoms for Peace are signed to XL Recordings, a subsidiary of Beggars Group – which has a policy of paying its artists 50% of all streaming revenues, in contrast to less transparent policies elsewhere.

22% of Beggars’ digital revenues in 2012 came from streaming services, with label boss Martin Mills saying that the majority of its artists earned more from streaming than from downloads, and that Spotify paid the highest unit revenue of the streaming services.

Added colour to this story comes from the fact that Flea’s other band, the Red Hot Chili Peppers, signed a high-profile exclusive streaming deal with Spotify last year. Although that’s consistent with Godrich’s argument that streaming works well for established bands.

We’d expect Spotify to respond to Godrich’s tweets in the coming days, though: and while we can predict some things they’ll say (the company expects to pay $500m out to music rightsholders this year, for example), we think that they may need to explicitly address how streaming works for new artists too.

There are already some dissenting opinions from within the industry. Music producer Stephen Street has tweeted his own views on the subject, pinpointing Yorke for criticism over Radiohead’s previous digital strategy.

“Bit rich coming from Thom Yorker that Spotify doesn’t work for new artists. It’s exactly what I said when Radiohead… made their album available for free/ pay what you want a few years back. Suits superstars with 10 years of EMI investment behind them,” he wrote.

“It didn’t help new upcoming artists at all. Gave the wrong message that music had no value . It’s bitten you on the arse Thom!”

We’ll keep you posted on the running debate. The key point is that this is about how streaming works for new artists in particular. It’s a debate Spotify is already engaged in through its actions – the service’s Discover tab is one example of the company trying to help its users discover new music as well as old favourites.

But the company and its rivals need to do more to put their case to new artists. Because the perception of Spotify as a tool of the major labels that only benefits big artists is toxic, to say the least.