Analysts from Deutsche Bank have suggested that major labels are unhappy with their share of slots on Spotify’s curated and algorithmic playlists.
However, the caveat is that according to Business Insider, their note to that effect is based on a single source: an ‘unnamed 25-year music industry veteran, who sat with the analysts and tried to help them understand Spotify’s economic position’.
The key quote from this source: “Algotorial playlists on Spotify have a lower share of major label content. As this grows in the listening mix the major labels stand to marginally lose share. Our featured speaker noted this as a major thorn in labels’ sides.”
The emphasis in the article is on Spotify’s programmed playlists: Rap Caviar and so on. We can’t help wondering whether the issue (for any major-label executives worrying about this, at least) is more about the algorithmic playlists like Discover Weekly.
There is some anecdotal evidence from the independent sector to back up any rumours of tensions, however. Indie licensing agency Merlin recently said that its members’ music “performs over 25% better in market share terms on paid tiers vs free tiers” in the streaming world generally.
And its CEO Charles Caldas recently told Music Ally that the algo-personalised playlists on Spotify and other services do benefit indie labels. “You’ve got this personalised curation that looks at what you are listening to, and what you might engage with,” he said. “And from the data we’re seeing, if you put great music in front of the consumer, they don’t care if it came from the label with the biggest marketing budget.”