John Paul Titlow has a neat piece on Fast Company about the conundrum Spotify faces with streaming. It’s hard for the service to afford its hefty payouts to traditional record labels while adequately compensating the up-and-coming artists or indie bands who – ideally, at least – use Spotify to gain exposure. Titlow suggests a potential route:
Perhaps while the larger business model is shaking out, they could build tools that help artists drive other types of revenue and more easily promote themselves. The desktop add-on app for Songkick, which notifies users of upcoming concerts by bands they’ve listened to on Spotify, is a great start. The process of buying tickets could be integrated into the Spotify desktop client. Maybe Kickstarter integration is one of the next steps. Like this artist? Click here to fund their campaign to record their next album. We already have your credit card. We’ll just debit it from your account next billing cycle.
I think that steps like this are more than just temporary revenue band-aids. The same “creative destruction” sown by the digital era – in the form of piracy, YouTube’d concerts, robo-ticket buying and single-song downloads – can also be used to leverage what has become the equally lucrative side of recording: merchandising and live performances. I can totally see it being spammy – “Buy this Modest Mouse T-Shirt!” – but one hopes that Spotify can bring the same elegance to integrated services that it already exercises in its apps.