Spotify is Paying Musicians Poverty Wages. Why are Antitrust Laws Protecting Them?
Why haven’t musicians organized like other industries to demand better payouts and have more say in who can discover their songs? The answer is they’ve tried, but their classification prevents them.
Imagine you’re a vocalist. Since you were a young child you spent countless nights rehearsing to sing your heart out every Sunday for the church choir. You always knew singing was your passion and now you’re finally at an age where you can make your musical dreams come true.
You want to record your first album but to rent the studio for 5 days, you need to come up with $5000. Not only that, but you need to hire an engineer and producer to synthesize everything. Another $5000 setback. You probably need some background musicians. Perhaps just the basics: a guitarist, bass, and drummer. They each charge $500 per day. And don’t forget you need $1000 to mix each song. All in all, you need to find roughly $27,500 to fully produce your album.
To make matters worse, even if you could come up with this exorbitant amount of money, Spotify only pays $0.0035 per stream. Spotify’s algorithm has influence over who can find your album and they’ll only pay you if someone listens to your song for at least 30 seconds. This means your album would need to be discovered and streamed 7,857,143 times just to break even, let alone earn a living wage. Sounds impossible, right? And yet, this is the reality for the majority of new artists trying to catch their big break.
In most other industries, when employers pay unsustainable wages, their workers form a union and negotiate for higher salaries. Truckers do it, teachers do it, even others in the entertainment industry like actors, writers, and set workers unionize to negotiate livable wages. So why haven’t musicians organized in this way to demand better payouts and have more say in who can discover their songs?
The answer is they’ve tried. But unlike other entertainers, singers and songwriters aren’t allowed to organize. Because they’re classified as independent contractors, rather than employees, they are completely unprotected by basic labor rights outlined in the National Labor Relations Act.
It wasn’t always this way. Throughout most of the 1900s, musicians were organized in unions and fought to protect their wages in the wake of technological innovations like vinyl and radio. However, in the 70’s and 80s, the National Labor Relations Board (NLRB) made a series of rulings which classified singers and songwriters as independent contractors and denied them the ability to collectively bargain.
Because artists don’t have a direct employer/employee relationship with music streaming platforms, they can’t organize against them for fair wages or workplace protections such as algorithmic fairness. In fact, antitrust laws, which are intended to promote open markets and negotiations, are weaponized to accuse musicians of colluding if they even tried to collectively negotiate.
One industry expert explains, “if these musicians worked together to collectively bargain with Spotify or threatened to pull their music to push for better rates, they would risk being sued as an illegal cartel.” Without a legal way to negotiate directly with music streaming platforms, most singers and songwriters cannot make a living wage and are forced to pursue other sources of income.
These precarious labor dynamics in the music industry are likely to be exacerbated with advances in AI generated music. While creatives from other entertainment industries are actively leveraging their union power to demand adequate compensation from AI generated art, musicians currently have no such leverage. If antitrust and labor laws continue to limit the ability of artists to exercise power over the profession, the result could be the complete side-lining of human-generated music in favor of AI generated music built off the backs of generations of musicians.
Thankfully, there is a simple solution.
In 2023, Congresswoman Deborah Ross of North Carolina introduced the Protect Working Musicians Act (PWMA). This bill would allow artists to collectively negotiate with music streaming platforms and music-generating AI platforms without being held liable under antitrust laws.
In her words, “working musicians and small independent labels face urgent challenges to their livelihoods posed by the market power of streaming platforms as well as the explosion of AI applications that use their work without licensing or pay. This legislation will help give small, independent music creators a level playing field, empowering them to stand together for fairer compensation and giving them a voice in important negotiations that will determine the future of the music industry.”
Since its introduction, the PWMA has seen little movement through Congress. It was assigned to the House Committee on the Judiciary in September 2023 and stalled there for over a year before the congressional session ended this past January. Without enough bipartisan support, Ross may not reintroduce the bill and musicians across all our communities will be left vulnerable to the whims of Spotify.
Now, more than ever, musicians need our help in securing their profession. If wages are not raised and rights are not established to protect them from technological innovations, we risk losing all the beautiful songs that get us through life, from celebrating holidays to soothing heartbreaks. Music and musicians are a fundamental part of our society that needs protecting. No matter what side of the isle you stand on, call you representative and ask them to support Congresswoman Ross in her quest to right this wrong.
By Sofya Diktas