NEWS - PROTESTS CONTINUE OUTSIDE SPOTIFY'S HQ
Have you checked your pulse?
- Sorry? - Have you checked your pulse?
Thanks for coming on a Sunday.
Yeah, it's no big deal.
Is Jim here?
- Yes, he's in the pavilion. - Okay yeah, good.
- Jim! - Daniel.
- Good to see you. How are you? - I'm great, and you?
- Yeah I'm good. Thank you for coming. - No problem.
Always a pleasure to come over here and get down to the nitty-gritty.
- Yeah. - How's the Arsenal doing?
* terrible, they lost again.
- They'd be better off with you in charge. - Yeah. Your words, not mine.
So...
As you know, we have an urgent need to maximize revenue,
or at least bring down our cost base.
If this business is gonna thrive, we have to reduce the cost of the music.
That's the main reason we spent the last few years testing Discovery Max,
and now, finally, we have some useful data.
Yeah, and...?
* fantastic.
Yeah?
The artists have seen their followers go through the roof. They * love this.
- Alright. - When they get the promotion boost,
they are seeing listener growth of 40, 50, even 100%.
Concert sales and merch sales are going up...
Everybody who signed up to it said they'd do it again, no question.
Why don't we roll it out across the whole company?
Because it's highly contentious.
And because we only promote bands that agree to hand back a cut of their royalty.
The artists consent to everything. We're not charging anyone a penny.
It's a win-win situation, a new business model for a new kind of music industry.
Well the Musicians' Union calls it payola.
And Senator Madison Landy of the US Senate
wrote Spotify a letter expressing significant concern
that we are participating in anti-competitive activities.
Well, that's not * good.
Bottom line is that 70% of everything we bring in on the music,
goes straight back to the record companies. 70%!
What other business has to deal with those kind of costs?
Discovery Max is Spotify doing things its own way.
It's us showing innovation, reshaping music.
It's us putting power into musicians' hands.
By halving their royalties.
I mean, If we don't push the boundaries, we are not gonna survive.
Listen, what you and your team have done is amazing, and I love it,
but we do need to take this step by step. I mean...
For now, let's just...
let's roll it out in a way that keeps everyone on our side, okay?
- Hi honey. - Hi.
- How was the meeting? - It was good.
Is this the new architect?
- That's exactly what it is. - Yeah, okay.
- Are they tearing it all down? - Yeah. Yeah, I think so.
Should I pick up the kids?
- No. No, your mom will do that. - Okay.
Hey... You aren't worried? About the protests?
- No. - No?
But I can see that you are.
I'm just worried they're gonna blame you for this you know...
No, they won't blame me for anything.
Look at this. This singer has been on Spotify since the start.
Do you know why she stays? Because she knows we're the best.
Spotify, what we want...
A small but persistent group
has been protesting outside Spotify's headquarters here in Stockholm.
These comments are from protest leader Nadja Johansson, an ex-musician,
who feels forced to act because of the situation...
You have to go to school. I don't want you to be late today.
No, I'm not worried about that.
There's always going to be people who are opposed to success...
I LOVE IT
First floor.
- Hey, great gig. - Thanks.
- Yeah, I sent you the money. - Thanks, awesome. See you.
See you. Take care.
You've only given me half. What's going on?
I didn't sell as many drinks today as I did last time or the time before that.
Wait a minute, I played a gig you hired me to play.
Yeah, but do you want me to go broke just so you can play here?
I mean, you get free PR by playing here. People go home and stream your music.
That's great for you.
Okay, I... I don't know how this will turn out,
but I have reached a place where there's nothing more that I can do.
I am a musician.
I've worked my * off releasing and writing six albums in the last ten years.
I've had many hits. My songs are played close to 200,000 times a month on Spotify.
However, I don't make enough from any of that to pay my rent.
And I take all the gigs I can get, I have a job on the side,
everything for the privilege to make music.
Even though I tell myself every day that soon things might improve,
if I write a hit song, or end up on the right playlist, things will change.
But the truth is that the system is totally broken.
The music industry made 23 million dollars last year.
And the record companies are thriving.
They're making more money now than they did before piracy.
The ten people who make the most money in Sweden
come from the same streaming company every year.
Despite that, all the artists who create music for their platform
can barely survive.
Daniel...
Today you liked one of my songs.
You added it to your playlist, which is awesome.
But if you really liked it, how about you sit down and talk to us.
Help us create a new discussion about the streaming business.
Help us make a new system, a music industry where we can actually survive.
BOBBI T THE SYSTEM IS BROKEN
- Everything okay? - Absolutely.
I know this is something you dismissed a long time ago and...
Well, you may not like that I bring it up, but considering the situation and...
I'm sorry to interrupt, but have you been online?
- No. - Take a look.
CHILDHOOD FRIEND CHALLENGES DANIEL EK.
Bobbi Thomasson, musician and childhood friend of Daniel Ek
posted an emotional and personal video on her Instagram story yesterday.
Daniel, today you liked one of my songs.
You added it to your playlist, which is awesome.
But if you really liked it, how about you sit down and talk to us.
Since last night, the video has been shared more than 12,000 times,
and has the support from a growing number of other musicians.
Everybody, this is Bobbi Thomasson, she can get to Daniel Ek.
Hi.
Well, we've been doing this for months,
but nobody really cared until after your post.
- Bobbi. - Rhonda.
Nice to meet you.
We put your video on our feed.
It's gotten over 20,000 likes in under two hours.
And the hashtag 'Scratch the Record', trending since yesterday.
You connected with people, now we are all in.
No, I don't think that I'm the right person for this.
I just posted a video because I was tired and cranky.
No, you're an activist.
We are all activists now. They've forced us into this.
Well, this may sound a bit strange,
but I know Daniel Ek, okay?
We grew up together, and I mean, I support you 100%, of course,
but I posted the video because I wanted to start a dialogue.
And regardless, I have to wait and see what he says.
You haven't checked your Instagram today?
He stopped following you this morning.
Daniel is not interested in having a dialogue.
None of them are.
They want us to shut up, they want us to go away.
Just so you know, there's another protest happening by headquarters.
Okay.
Daniel, would you mind looking at this?
Yeah. What is this?
It's a proposed sale of Spotify.
I know that this isn't something you've considered before,
but every CEO, every founder, has to choose their moment.
- You've had an amazing journey. - No, I won't sell Spotify.
You hired me to be somebody who's always straight with you and tells you the truth.
And I'm doing that right now. The market is still in our favor.
But what will you do when the market value drops below the IPO?
I hired you because you're pragmatic and stubborn, but this is too much.
Okay, and what do we do right now?
We'll have to borrow some more money.
Daniel, last year we already borrowed more than one billion dollars.
We're gonna have to borrow some more and that's how we get through this.
We'll do some more acquisitions, invest in some new tech, like we've always done.
This is your way out.
If you sell Spotify, you protect your legacy.
You also protect your brand, you protect what you've built...
I won't sell Spotify, I...
I'm not retiring yet.
- Daniel... - What?
Scratch the Record! Scratch the Record!
Okay, hold your heads down. Security is here.
Shit!
Scratch the Record! Scratch the Record!
- Daniel, this is outrageous! - Yeah, I know.
- Just relax, okay? - Relax?
The business model that we have, it's fine.
We have new content, we'll give them more support and soon we'll have Discovery Max.
There's no reason to panic.
No, I'm not here as Daniel Ek's enemy.
I'm here as someone who used to know him,
and who believed in the promises he gave me and other musicians.
Scratch the record!
I'm here today to say that enough is enough.
I have told my colleagues to be patient.
I've tried to believe in him.
But the average salary for an employee at Spotify is 130,000 dollars,
while the musicians who build his platform are on their knees.
Daniel Ek, it's time for you to "Scratch the Record".
It's time for you to sit down and talk to us, for real this time. We're waiting
- Unbelievable. - Yeah.
This pantomime is distracting the whole office. It's a public disturbance.
- We should call the police now. - We can't call the police.
This is a platform for musicians. How will it look like if they're arrested
- outside our office? - Exactly.
Well, it looks like the police decided to turn up anyway.
This is illegal demonstration. You're disturbing the peace...
- and we ask you to leave immediately. - Shit.
Scratch the Record!
Let her go!
- Don't hold me! - You're disturbing, please discard now!
I repeat, this is an illegal, demonstration. You're disturbing the peace
and we ask you to leave immediately.
Anyone who remains on this premises will
will be arrested.
This is bad, Daniel.
I think it's a story just because it's in Sweden.
We shouldn't forget that we are listed in New York.
We have more Chinese shareholders than Swedish ones.
But this may affect your ability to borrow more money. You know what?
I'm working myself to death, I run from bank to bank.
And you know what the first thing is they ask about?
These protests.
Daniel... you made it clear that you don't want to sell Spotify.
You want me to find more money that will enable new innovations.
Okay. Well in that case, you will have to make sure this doesn't get any bigger.
One thing that I've learned during my in politics...
"Never let yourself become the story."
- Do you want to play with us, Papa? - Yeah, maybe later.
Hi.
You okay?
You're everywhere, Daniel.
These protests, they're not gonna die down.
All those... sorry... those damn protesters who say that Spotify needs to change,
- I don't even understand they mean. - Are these the new designs?
Yeah.
About this, erh...
Ernst was a bit worried that you might think it's a bit too big.
Don't compromise.
I think we should make it even bigger.
Hello. Did you get hold of Sundin?
Okay, tell that traitor that I'm on my way.
- Hey. - Hey yourself!
How are you? Nice to see you.
- It's nice to see you too.. - So, you okay?
- Yeah, well... I'm alive. - Yes, I know.
Discovery Max looked... I saw some test results. They were...
Here is the deal. I need you to do something.
Okay...
I want you to call Bobbi Thomasson.
I want you to explain to her that this thing she's doing can only be
detrimental.
That it's based on a complete misunderstanding of how Spotify works.
I don't think I've seen Bobbi in about ten years.
I can try to get her contact information and then you...
Hold on. Did you say try?
- Yes, I can try to get hold of... - She was your performer.
You were the one who signed her. You promoted her.
- You can contact her. - No, I can't.
I know what's going on.
You use these people, sign them, use them for money,
and then when you are finished, you forget them.
When Bobbi is upset about what she earns,
does she turn to a Universal or a BMG?
Does she turn to any of the people who are responsible for what she earns?
No, she and her stupid, * friends of hers set up camp outside my office,
throwing all their * shit at me.
Did I sign her? Did I encourage her?
Did I encourage any of these over millions of people who live in that fantasy
that you have sold them, that they might be the next Drake or Taylor Swift,
getting them to sign shameless contracts they are too young to understand.
But who do they hold responsible?
Let me give you an answer, me!
But you don't care! Of course not! Why would you?
You and the record companies got what you wanted, 70% of what we make.
Yeah, you got a really good deal there.
And I'm the stupid bastard who * agreed to it all.
It's gonna be a while.
RESTAURANT
At a bar in Rågsved?
Uhm mh.
- Why are you here, Daniel? - I think we should talk.
Now? When I have a gig?
I don't care whether other people protest. But you, Bobbi, you know me.
That's why I joined them. If you don't know someone, you won't listen.
But what is it you want me to listen to?
A bunch of people who refuse to accept the world has changed?
That's not true, it hasn't changed at all. It's like a * bad dream.
Maybe you haven't understood how to make the most of Spotify.
- Please, don't do this. - Listen to me. I just wanted to say...
If you let me... I will show you how to make the most of Spotify.
And then? Are you going to pay a visit to the other 1.5 million performers and what?
- Tell them all your secrets as well? - You remember how it was?
You told me that Pirate Bay uploaded all of your songs.
So we should be grateful that they aren't stealing from us like 15 years ago?
No, that's not what I mean. Come on.
You're talking about your journey...
But what about our journey?
All the millions of musicians who have absolutely no control of money they earn.
It can't be my responsibility to help the careers of all the artists.
Why not? You are the most powerful person in the music industry right now.
You are the system and that's what you wanted.
You wanted to create the biggest music platform in the world.
- Bobbi, it's time. - Okay.
- Nice place... - Bulshit.
My point is, you don't actually want to help us.
Bobbi, I do want to help you.
Bobbi, come on.
Okay, yeah.
Thank you for staying for the whole gig.
What's wrong?
I understand that you want me to... to change Spotify.
But the changes that you want me to make,
would destroy us.
It doesn't have to be that way.
You have your songs, Bobbi.
Your music... That's what Spotify is to me.
Everything I am is a part of that.
And it doesn't matter what you say,
I will never let anyone take that away from me.
Scratch the Record.
A movement called 'Scratch The Record'
is now spreading around the world.
The Swedish artist named Bobbi Thomasson...
BREAKING - PROTESTS ACROSS EUROPE THOUSANDS OF MUSICIANS MARCHING
THE BIGGEST REUNION OF MUSICIANS AND FANS TO THIS DAY IN PARIS
Protest against Spotify...
SCRATCH THE RECORD SPOKESWOMAN BOBBI THOMANSSON HAS RISEN SUPERNOVA FAME
Scratch the record.
This is bullshit.
You know they only reason they brought us here is to humiliate us.
It's the US Senate Daniel, they're meant to humiliate us.
But I'm not supposed to be here. I'm not American citizen.
Daniel, you've got this.
You know what it is? It's theater.
You're the CEO, Daniel.
You run the company.
If we lose this argument in front of the committee,
our whole business could be screwed, so please, just don't resist.
Yeah? Focus. Stay cool and calmly answer everything they throw at you.
We're here.
What kind of power do they really have?
The kind of power that can recommend a fixed price of a stream,
regulate everything and completely destroy our business model.
You have to focus on the Senator Landy. This is her hearing. She pushed for it.
She's staked everything on this. Do not let her win.
Daniel?
Okay.
What the * is she doing here?
Forget about her. She's irrelevant.
She's here as a representative or some shit. Whatever, who cares?
You have to shut Lanley down.
What about the everyone else?
Keep them engaged. As long as they make eye contact with you, we're good.
As soon as they start avoiding your gaze, we're *. And Daniel...
you can do this.
Do you swear to tell the truth, the whole truth and nothing but the truth,
- so help you God? - I do.
Could you please identify yourself for the committee?
My name is Daniel Ek and I'm the CEO and co-founder of Spotify.
Mr. Ek, you previously described Spotify's mission as
"To unlock the potential of human creativity
by giving a million artists the opportunity to live off their art."
Yes.
How is your progress towards that?
Excellent. Our top tier club of artistes who can support themselves from streams
has doubled in the last three years and tripled since 2015.
That's impressive...
So, at your current rate of growth,
you would hit that one million figure in... just under 75 years?
Your business model just doesn't work for musicians, does it?
That's not true.
What are the average earnings of an artiste not in your top tier?
Well, the number of artistes changes so fast for us to know.
Mr. Ek, from your own data, I can see here that the figure is...
12 dollars a month.
- Could you live off that? - Well, that number is not verified.
It's taken from your own results.
Excuse me, Madam Chairwoman. Mr. Ek...
Isn't it the case that Spotify is just one platform among many?
Yes, that is correct. Spotify is one platform among many,
and artistes have several platforms to earn an income from.
It's not fair to put all that on Spotify.
What percentage of the streaming market does Spotify control?
I believe it's around 25%, Senator.
You control almost 45% of the US market alone.
In some countries, your share is as high as 60%.
Five times as many users as your nearest rival.
To all intents and purposes, you are a monopoly.
We are not a monopoly.
No artiste can take themselves off your platform,
no artiste can risk losing exposure to your audience.
You control streaming and you control the fate of musicians.
I'm sorry, Senator. Was there a question in there, or...?
Do you believe the size of your business model creates a problem for artistes?
Spotify is about partnering with the artiste,
In building the music industry with them, they create a future together.
When the Copyright Royalty Board awarded songwriters
their first raise in almost 50 years, how did Spotify react?
- We sought clarification. - You sought clarification?
You took them to court. You lodged an appeal against them,
and you got lawyers to argue for a cut in what they're paid.
Does that sound like a company that supports artistes?
It sounds like a company that has its own approach,
but we support songwriters.
We partner with them, we champion them.
You use your size and marketing budget to silence your critics, Mr. Ek.
At every opportunity, you do everything you can to drive down
the share you pay musicians.
Don't you think you have a responsibility to these people?
I believe that musicians need to understand
that I'm the best friend they've got.
I'm the only one who's not lying to them.
I'm the only one who's honest about the fact that we can't go back,
that this is a completely new industry with new rules and new principles.
I'm the one working day and night to create the opportunities
that they need to achieve their dreams.
What is Discovery Max?
Discovery Max is a perfect example.
It's a service that helps artistes.
Discovery Max is a service,
in which you take a bigger share of the artist's royalty,
and in return offer them extra promotion.
Well, Discovery Max is an exchange between Spotify and the artiste.
It is straight up music industry payola, and it has to stop.
You're splitting hairs, Mr. Ek.
You reduce the artist's royalty and in return you fix the game.
We're not fixing anything.
The major record companies own almost 20% of Spotify, don't they?
It's possible. That's... It's around that number, yes.
So, the musicians are on the labels,
the labels own part of Spotify, Spotify decides which musicians get promoted,
and then the income from the streams goes straight back to those labels.
What part of that does not sound like a cartel?
We're not a cartel.
You control the market.
You're in bed with your suppliers.
And then, at every turn, you use your reach and your technology
to drive down the share that you pay musicians,
to pay the people that depend on you and your platform to make a living wage.
Can you seriously sit there and tell me that in any other part of the world,
this would be considered acceptable?
There's a lot of negative comments. The word cartel seem to resonate.
It's a few voices on social media, It's nothing to...
Would you please identify yourself for the committee?
My name is Bobbi Thomasson.
I'm a musician, but I'm here today
as the US and global head of a musicians group called "Scratch the Record".
That's a musicians' advocacy group?
Yes, that's correct.
And what are you advocating?
When our music is used, when it's streamed,
we argue that musicians deserve to be paid a fixed price per stream.
And we want that to be recognized in law.
We would all like to get paid more, but that doesn't mean we can change the law.
Musicians have lobbied streamers for a decent cut,
but all we ever get are words. We need a law.
In every generation, there are winners and losers.
And people say that's just how it is.
But this Senate has always been able to tell the difference
between change and exploitation.
Miss Thomasson, with all respect,
you're not a front line worker, you're a musician and you chose to do that.
So you want musicians to accept that music is precious,
but they're interchangeable?
- That's not what I said. - It is what you said.
It's what everybody always says.
But if you want to enjoy something,
you have no right to ignore the conditions it was made in.
Spotify is... It's just a platform.
Spotify churns out a product to millions of phones and laptops,
like a factory,
and the workers that supply that product are musicians.
Spotify is always telling us how grateful we should be for that exposure,
but I'm here to say that you can't pay the bills with likes.
We don't care how many analytics you build,
how many different ways you tell us
we have more listeners in Boston than Stockholm.
When our work is used, we want to get paid.
Why is that this Senate's business?
Why is that not for the market? Or for the consumer?
Because, in 1938,
this was the Senate that introduced a statuary minimum wage for the employees
of the new steel and oil industries.
Senators saw that the world had changed.
A new law was needed.
That minimum wage looks obvious now.
But the bosses fought it.
Law makers had to see that the oil companies simply had too much power.
That is exactly where we are today.
This is about the big monopolies of today.
It's about whether we have the courage to see that musicians
are no different to oil and steel workers.
We deserve the same rights...
the same recognition...
and until we acknowledge that,
streaming will always be exploitation.
Bullshit. Exploitation? The law?
Who the * does she think she is?
She's someone who knows she's got the support of several senators.
So what if she does? So do we. We have...
Lobbyists. We have influence. Do not go and talk to her, Daniel.
I can't just ignore her anymore. Just... stay calm.
Well, that was... You were impressive.
- I know you don't mean that. - I do, unfortunately yeah.
I'm just the messenger.
But the message, Bobbi, you can't be serious.
Exploitation?
You compared Spotify to an oil company.
I remember what you said at the start...
I remember your promise that everybody would benefit from Spotify.
Think about that.
- Daniel. - Yeah?
- It's done. - What's done?
I just spoke to the bank and they agreed.
Another billion. You got the loan.
Okay...
What do we do about all this?
Do you think the bank cares about what a bunch of activists or senators think?
In all this chaos they heard only one thing: 45%.
You control the market. That's all they care about.
Uhm. What do you think?
Maybe you're right.
I might have been in politics for long.
But listen... This is the last loan we can take out.
You have to figure out the business model.
If you can't do that, do not take the money.
Thanks.
Are you all okay?
Do you know where Bobbi went?
You know what I regret most about Spotify?
That I didn't walk out on the negotiations.
When you're sitting there in the first talks about the music rights...
I should have said that, "This is the future.
If you want to be a part of it, it has to be on our terms."
That would have been so damn beautiful.
So what you're saying is that everything would have been better...
if you'd stopped listening to people?
Yeah.
That was the last shot for me and you too, guys!