The Spotify Method
When it comes to A.I., screwing artists over is not a side effect, it is the GOAL.
Hey y’all, it’s KimBoo! I’m an author and a podcaster who is also a librarian, text technology historian, and former I.T. project manager. I write about a lot of interesting things, I hope you agree! Please consider supporting me (and my dog!) so I can keep throwing errata & etcetera into the Scriptorium!
Back in December 2022, which was after MidJourney had launched but before ChatGPT hit the mass consciousness, I wrote a brief tumblr post which is the basis for this essay. I don’t offer many solutions here, just a framework for understanding what the real issues are.
The tl;dr is that screwing artists over is not a side effect of technology; it is and always has been the GOAL and AI is just gonna be another iteration of that.
I was talking with a friend this morning about art, and that ever-ephemeral question: what makes an artist? Is it a question of intent? Technique? Medium?
Yes and no; and to be sure, I am not in any way shape or form qualified to answer the question. What I am qualified to talk about, though, is how technology slots into the gears of society’s perception of “art,” and more importantly, our consumption of it, how much it costs, and what that means for people who make the art. We live in a capitalist society and even art must provide value to the property owners, be that directly as an investment (“fine art” collecting) or indirectly through production of media for paid consumption (media conglomerates).
I’m not claiming that Lifetime Christmas movies are art, or run-of-the-mill erotic romances are art (perhaps they fall into the realm of craft?) but either way, when money enters the mix, whether something is technically “art” doesn’t matter. It is a product made to create profit.
Which is where technology comes in, because industrialization has left no stone (or art form) unturned. Music is the best representation of this, because there has been money in music for centuries, but it wasn’t until music could be recorded that the “music industry” was born.
Here is where the true-blue capitalism comes in, because a capitalistic industry is a voracious beast and depends on two things: never-ending expansion and ever-lowering production costs.
And labor? Labor has always, always been the most expensive production cost for businesses.
In the music industry, “labor” is songwriters and performers, sound engineers and producers, so the easiest way for a music company to make money, aside from selling a lot of hit songs/albums, is to cut labor costs. The way studios ripped off songwriters, especially Black songwriters and performers, is legendary but it’s not just history. It has not stopped, or even slowed down. The focus has shifted from predatory signing away of rights to simply paying out pennies per play-through on streaming services.
Traditional music corporations have had to adjust to the changes in technology, to varying degrees of success. Record labels now focus on concerts and music streaming (as opposed to selling albums or individual songs), and they are big enough to make their own deals directly with Spotify.
Spotify makes billions of dollars in revenue each year. Billions of dollars. BILLIONS.
Begging the question: why aren’t the musicians on the platform making a lot of money? Why aren’t people screaming that question from the rooftops? Well, people do scream about it, but Spotify is always very careful to claim that they pay artists “fairly.”
I call it the Spotify Method: Stream the music; develop an arcane and opaque system of micropayments for artists; claim that the expense of streaming means that the micropayments must be low or they will go bankrupt; make billions in revenue and record profits for the top brass and shareholders.
Amazon uses a similar system for self-published authors selling on their Kindle Unlimited platform, where the payouts are roughly .004-something cents per page read. In June, 2023, it was $0.00409. In understandable terms, that means an author must have 1,465 pages read of their work to equal the cost of buying one book at $5.99. In other words, the “price” of a 200 page book on KU is $0.80. That is what the author earns.
A boon for readers, sure, but a bigger boon for Amazon. The “pay per read” screws over authors in the same way the “pay per listen” does musical artists. It’s all on the spectrum of reducing labor costs. Micropayments have been a windfall for corporations holding the purse strings.
Circling back around to the topic of “screwing over artists was always the goal,” the issue a lot of people have with ChatGPT and Midjourney et al is the way publicly available content was scraped to train their large language models (LLMs), and how users can generate content using parameters that re-create copyrighted work. I’m not going to weigh in on the legalities or ethics of it, just acknowledging it was done. (Insert “barn-door-horse” analogy here.)
Everyone feels like they are being cheated, and they arguably are, but the danger here is not “pay artists or don’t pay artists” but “how will artists be paid?????”
Whether the topic is licensing your content to get paid “per scrape” or getting a kickback if your content is used to generate text or an AI mashup image1, my bet is that it will function like Spotify, or any other streaming service: micropayments.
This is how “pay the artists” is gonna end up, and I guarantee you that this is already being discussed behind closed doors.
There will be nothing to argue about “value,” or “quality,” or “living wage.” Zip-zero-zilch.
Like Spotify artists, text content and image artists will get paid for their work if it is used, and that payment will be something like $0.00021 per use. If we’re lucky.
Oh, there will be waffling on the exact price, and there will be Very Good Arguments on Why This is the Best Way Forward despite the fact that it will screw all of us over.
Because screwing artists over is not a side effect, it is the GOAL.
By the way, Spotify has already been creating “artist-free” music channels for years using fake artists. There is a scandal about it within the music industry, although chances are good you’ve never heard of it.
Ostensibly they are created by “independent record labels” which, strangely, don’t seem to represent any actual, living musicians and have business connections on the back end directly with Spotify. At this point, they probably still have studio musicians who do the actual work, but how long before AI cuts even those bottom-of-the-ladder working stiffs out of a paycheck?
Not long.
Capitalism is about reducing the costs of a product in order to maximize profits. The highest costs of any business anywhere are the human-labor-related costs, and if businesses can keep pushing people out of the production process, then they will…because reducing quality might affect sales, but squeezing labor is just “good business practices.”
Any MBA will tell you that.
Whether that is even possible, given the nature of LLMs, is up for debate. But I’m making the assumption that it could be done, for argument’s sake here.
We're all going to have to learn to sell direct. Maybe a car boot sale is in my future.
I kept reading all the way to the end, hoping that you would eventually make an argument That would tie all the points that I was disagreeing with together in a way that made me see it all in a different light. But it never happened.
Spotify had ~$12b in revenue last year, but paid artists $8b. So that's already 75% of their revenue. There were apparently another billion in operating costs, bringing gross profit to $3b. But gross profit doesn't tell you all that much, really. Gross profit is just how much you sold minus the cost of creating/buying it. What you want to look at is net revenue, which is the thing that people are thinking of when they say profit. The two terms always sounded backwards to me.
But when you look at their net income, Spotify has actually lost money 3 years in a row. Almost a billion dollars last year.
The reason streaming services pay so little for content is because people consume so much more on an all-you-can-eat model than ala carte. In 1999, I could get a CD a month, giving me 12 hours of music, for the price I can get hundreds of hours of music to listen to on Spotify. To keep the cost of a song what it was in 1999, Spotify would cost hundreds of dollars per month.