Music artists won’t benefit from streaming platform Spotify filing to go public says international DJ and founder Gareth Emery.
The Swedish company filed the paperwork to list shares on the New York Stock Exchange on Wednesday under the ticker ‘SPOT’. It is the largest music streaming service with 71 million paid subscribers.
Southampton-born Gareth Emery made his name producing and spinning trance and house tracks around the world and is now setting out to disrupt the legacy music industry through Choon.
The blockchain-based platform is a way to pay artists fairly and quickly in cryptocurrency.
“The whole system is cloaked in secrecy, nobody knows how much they’re going to get paid or when,” said Emery.
“It can take over a year to get paid for a stream, and up to two years. Even with over a million listeners, and tens of millions of streams, I couldn’t rely on Spotify for an income – so it blows my mind how smaller artists are supposed to manage?
“Whilst I’m sure the IPO will be a fantastically profitable day for venture capitalists, Spotify shareholders, and major record labels, you won’t find much celebration from artists themselves, who once again find themselves at the back of the line for payment of their work after the music industry monopolies have cashed in. It’s madness.”
Launched in mid-February, Emery says Choon ‘cuts out the middle-man’ and ensures that 80 per cent of the proceeds from streaming will go to the artists – which he claims is far more than through traditional methods.
“In Spotify’s IPO filing, it states its original aim was to reimagine the music industry for the better for both artists and consumers,” he said.
“However, talking from the point of view of an artist with over a million monthly listeners on the platform, this hasn’t turned out to be the case.
“Spotify has always been run for the benefit of the major record labels – all of which are shareholders – whilst artists get crumbs from the table.”
In an unusual move the company is planning to do a ‘Direct IPO’ which offers shares directly to investors.
The company states that shares have traded as high as $132.50 on private markets. This would amount to a valuation of over $23 billion based on ordinary shares outstanding as of February 22.
BusinessCloud has contacted Spotify for comment.