Today, Explained - How Spotify picks its winners

Episode Date: June 27, 2024

No, Sabrina Carpenter probably isn’t paying the streamer to play “Espresso” every time you’re listening to music. But the app is making changes to its business model that could impact your listening. This episode was produced by Peter Balonon-Rosen, edited by Matt Collette, fact-checked by Laura Bullard, engineered by Rob Byers and Andrea Kristinsdotter, and hosted by Sean Rameswaram. Transcript at vox.com/today-explained-podcast Support Today, Explained by becoming a Vox Member today: http://www.vox.com/members Learn more about your ad choices. Visit podcastchoices.com/adchoices

There's something very strange happening on the world's largest music streaming service. People around the world say they are experiencing the same phenomena. They play a song, any song, a random song, but when that song is finished, a new song plays. But it's always the same song. Your playlist finishes, there's that song. Espresso. That album finishes, there's that song. Espresso. Espresso finishes.

There it is again. Espresso. The Espresso Conspiracy theory is brewing on Today Explained. Now here, think about me every night, oh. Is it that sweet, I guess so. Say you can't sleep, baby, I know. Does that mean espresso? This NFL season, get in on all the hard-hitting action with FanDuel, North America's number one sportsbook. You can bet on anything from money lines to spreads and player props,

or combine your bets in a same-game parlay for a shot at an even bigger payout. Plus, with super-simple live betting, lightning-fast bet settlement, and instant withdrawals, FanDuel makes betting on the NFL easier than ever before. So make the most of this football season and download FanDuel today. 19-plus and physically located in Ontario. Gambling problem? Call 1-866-531-2600 or visit connectsontario.ca. Rebecca Jennings, senior correspondent at Vox. We've asked you here to explain a phenomena on Spotify.

Now, I'm going to confess that on my Spotify, I'm very particular about never letting Spotify ever play any music for me. Oh, wow. I want to listen to the music I've already predetermined that I want to listen to. This is some control tendencies happening. Sure. I'm very particular. I am my own DJ. However, I know that I may be in the minority. How are other people, maybe even you, experiencing music recommendation on Spotify right now? So there has been a lot of online chatter over the past two or so months

where people were saying, why does this song play after every single song that I play regardless of what it is? Can espresso please stop coming up after every single thing I listen to? Is this happening to anybody else? Every single time on Spotify, something I was listening to ended, it would start playing Espresso by Sabrina Carpenter. It's just espresso, espresso, espresso. And it's not Sabrina Carpenter, the artist. It's not a genre. It's just espresso, espresso, espresso. And it's not Sabrina Carpenter, the artist.

It's not a genre. It's just this one song. It's just this one song. It came out in April and just like, it really, really was just everywhere. No matter what song you played, it was just like, you heard those first few bars of espresso and you're like, oh, it's this again. And people's gut reaction to this song popping up over and over and over again is that there's some sort of untoward, payola-esque conspiracy on Spotify right now? On Twitter and TikTok, people are sort of saying their theories about what they think is going on. I've seen lots of comments about how Espresso by Sabrina Carpenter got to

number one on the global Spotify charts, basically because of payola. It's really suspicious. Like, is there payola going on? Some people call it Spotify-ola. I just say it's payola, but for Spotify. But I mean, that's definitely what's happening. They're like the labels and Spotify are, you know, they're all coming together to force feed us espresso down our throats. Which is a metaphor that works in two ways. It does. For people who aren't from like 1947, can you remind them what payola is? Absolutely.

So payola is a practice that is illegal. And it refers to when labels would pay radio DJs to play certain songs without disclosing it. Take the money. We're going to make this one a hit. Payola, crucially, it refers only to the public airwaves, airwaves on TV and radio. And so even if there is pay for play happening with Spotify, it's technically not payola because the internet does not apply. So that's not what's going on here. Another theory I see is that Sabrina Carpenter is a so-called industry plant. Sure. What exactly would that entail? So an industry plant is sort of this like vague term that people love to use on the internet when they suddenly start seeing an artist everywhere.

And they're like, where did you come from? Which is kind of funny because Sabrina Carpenter has actually like she's she was like a Disney Channel star like 10 years ago. Hey, I'm Sabrina Carpenter from Girl Meets World and you're watching Disney Channel. So she actually has been around for a long time. And like if you want to say that the whole like Disney machine is a little bit weird and corrupt or whatever, it's like, sure, I hear you. But like industry plant, that is not. I'm working late because I'm a Disney star. It sounds like she was literally planted by an industry 10 years ago. No, exactly. Exactly.

So for all the people who do think there is some conspiracy going on here. What is actually going on? How does Spotify's recommendation engine work? Why would it play Espresso more than the new Vampire Weekend? Oh, God. Well, because that album's bad. Oh, opinion! So there's a lot of different mechanisms for the algorithm to work, but basically one of its underlying principles is this idea called collaborative filtering,

where if you're kind of a standard pop music listener, it will take songs that other pop listeners are really liking and adding to their playlist and engaging with or whatever and serve them to you. But why does it feel to people like it's just one song? I think it's like this concept that happens a lot in these recommendation algorithms, which is like snowballing. I think people are really familiar with it on TikTok, where it's like, you know, TikTok will like serve people a video. And if those people like that video, it will serve it to more people and more and more and more until it becomes like inescapable for a certain group of users. And Spotify is we can kind of safely say it works similarly. But because I think there is so much distrust within the music industry and for good reason,

because it's natural that people are like, well, you know, something else is going on rather than just sort of like algorithmic snowballing. What has Spotify said specifically about Sabrina? What have they said about this song Espresso? Because clearly there's this clamoring online for some reasoning here. Yeah. So I reached out to Spotify for a comment. They wouldn't comment on the record, but they did send me, of course, they did send

me two Instagram posts that they had published about the rise of Sabrina Carpenter. And they made it very clear that, you know, this is just an occasion where, you know, the stars kind of aligned with her career in general. She kind of did the standard, like, pop girly thing. And that coincided with the amount of plays of Espresso on the platform. But because this many plays are happening on Spotify, how much of those were just auto-plays that Spotify sort of pushed on to people versus people searching for Espresso? That's sort of the gray area of, well, how much is the platform kind of boosting this person's career versus other other forces? So there's a bit of a black hole on how exactly all this works. Maybe it's a huge black hole. But do we know if there is a legitimate way to pay for extra plays on Spotify? So there

actually is. Spotify has this thing called discovery mode, where artists can forfeit about 30% of their streaming royalties in an effort for Spotify to push their songs to more listeners. And this is obviously very controversial, as you can imagine, three members of Congress have signed a letter to Spotify saying, either you need to release a list of, you know, every single artist that's enrolled in the program. And also saying that as far as we know, the artists who are using it and the artists that Spotify publicly has, you know, said are using it are independent artists. They're not associated with major labels. They're basically doing this to compete with the major labels, which in the letter that Congress people said, you know, that sort of

creates this sort of like race to the bottom where the artists who are already like up and coming and they're less privileged than those signed to major labels, like they're forfeiting even more of their profits in an effort to just compete on the same playing field. It does feel sort of like, you know, a little like pay to play because it kind of is. But you're not paying anything. You're just like forfeiting the potential streaming profits. Deals with labels and recording artists are confidential. We don't know what's in them. And so, you know, there could be a lot of there could theoretically be stuff like Spotify is required to play this song like X, Y,Z times. I don't know.

If that were one day revealed, that Spotify was making deals with record labels to boost their artists, would Spotify be breaking any rules? Or would it just be sort of deceiving its listeners, its users? So I talked to two academics who study this, and one said that obviously, like, you know, it's not a payola law because, again, it doesn't apply. But I think, you know, in the future, the Federal Trade Commission could theoretically

count this as an example of, you know, undisclosed advertisements. And so the same law that, you know, requires influencers to say like, hey, like this brand paid for me to stay at this hotel or they're paying for me to post this. There is a world in which theoretically Spotify could be forced to say like, hey, the reason you're hearing this is because we're getting a deal from this.

I have to imagine it's pretty low on the list of federal priorities though. Why is Espresso playing more often than Vampire Weekend? I mean, maybe there's someone at the FTC being like, I can't escape Espresso. We need to do an investigation. I hope so. Member of the FTC. Rebecca Jennings, Vox.com. So just to summarize here, Sabrina Carpenter isn't an industry plant, or at least she's not a particularly new one. Spotify is recommending her a lot, but probably just because they think you'll like her, not because she's paying them to do so, probably.

But if you're looking for a reason to be mad at Spotify, we might have one when we're back on Today Explained. Support for Today Explained comes from Aura. Aura believes that sharing pictures is a great way to keep up with family, and Aura says it's never been easier thanks to their digital picture frames. They were named the number one digital photo frame by Wirecutter. Aura frames make it easy to share unlimited photos and videos directly from your phone to the frame. When you give an Aura frame as a gift, you can personalize it, you can preload it with a thoughtful message,

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Join the ACLU at aclu.org today. Today explained co-host. Sean Romsferm back at it. Sounds like you can't really be too mad that Spotify thinks you might like another and another and another shot of espresso. But if you want to be mad at Spotify, you can always be mad about how little they pay songwriters. David Israelite certainly is. He's in the middle of leading a fight against the streaming platform because he's the president and CEO of the National Music Publishers Association, or as its friends know it, the NMPA. Which is the trade association that represents all music publishers and their songwriter partners in the United States.

Okay. And right now, you are mad at Spotify. Tell me why. Well, it's not so much that I am mad at Spotify. It's that Spotify has declared war on all of the songwriters. Tell me why. Well, it's not so much that I am mad at Spotify. It's that Spotify has declared war on all of the songwriters that have made their business even possible. And so as a representative of those songwriters and music publishers, sure, I'm mad. But more importantly, I'm motivated to try to fix what is the problem, which is Spotify trying to cheat these songwriters out of the royalties that they deserve. Now, I'm sure a lot of Spotify users out there will be surprised to hear that Spotify has declared war on songwriters because they're just listening to espresso or whatever and had no idea.

So tell people what exactly you mean and how Spotify has maybe declared war, because they certainly haven't used those words. So if you're one of the 44 million Americans who subscribe to Spotify, what they've done is change the nature of your subscription to make you what is called a bundled customer. And what a bundle means is when you take a music product and you marry it with another product that's not music-related.

In this case, an audiobooks product. And then you try to tell the consumer that you're getting both for a higher price. That is something that Spotify has done without the permission or the consent of these 44 million Americans. And so if you go back to November of last year, for these 44 million subscribers that signed up for a music plan, all of a sudden, without any notice, you saw a little button in your subscription that said audiobooks, and it gave you for free 15 hours of listening to books a month. Okay.

So then fast forward to March 1st of this year, and Spotify very quietly rolled out a product that said, if you want to just buy audiobooks for $9.99 a month, you can sign up for just an audiobook product. And I suspect very few people have done that. In fact, if you try to even find it, they make it very difficult to even find. And the significance of them doing that is that what they now claimed is that for those 44 million subscribers that they had been giving audiobooks to for free since November of last year, that now made them a bundled customer. And so for those 44 million customers, a couple of things happened. First of all, under the law, if you are a bundled product, you pay songwriters under a different formula that results in songwriters

getting a significantly less amount of money than if they were just a music subscriber. And so we believe that Spotify has fraudulently converted these 44 million customers into what they call bundled customers in kind of a scam to try to pay songwriters less. Somebody's got to get Daniel Ek on the phone because he's trying to fuck songwriters. The second thing that happened is Spotify announced on July 1st they were raising prices. The music streaming giant is raising prices again for the second time in less than a year. You know where I'm really about to go back to? LimeWire because this shit's getting too damn expensive.

Okay, so what you're saying is Spotify is making a bunch of back-end changes, then all of a sudden they jack up the price a little bit, but in doing so, they somehow are paying musicians less and making room for audiobooks. Is that right? That's exactly right. And since you represent songwriters and not, you know, audiobook publishers, let me ask you, how much money is on the line here? How much do songwriters, musicians stand to lose?

So songwriters, and again, we're talking about not the recording artists who perform the music, but rather the people that write the music. That group is looking to lose probably more than $150 million this year. And that number will be even bigger next year. Because when Spotify raises prices, songwriters should get to participate in getting more money from the raised price i think it's probably high time that i ask you for the sake of our listeners who don't know how songwriters are getting paid through spotify in the united states you have to go back to the year 1909 when congress thought that songwriters and music publishers had a monopoly on player

piano roles, those things you would stick in a piano and they would play a song. Yeah. In 1909, Congress passed a law that said that songwriters and music publishers have to license their copyrights and the government will set a price. Copyright Act of 1909. Any other person may make similar use of the copyrighted work upon the payment to the copyright proprietor of a royalty of two cents. That law from 1909, fast forward to today.

The way that it works is that there are three judges in Washington, D.C. They're called the Copyright Royalty Board. And every five years, there's a trial. And on one side of the courtroom is my organization representing songwriters and publishers. And on the other side of the courtroom are the companies that do digital music like Spotify, Apple, Amazon, YouTube, Pandora. And at the end of that trial, the court issues a decision, and those are the rates and the rules that govern us for five years at a time. This court decided to impose upon the industry the idea that if you bundle a product, you pay under a different scheme.

They were not anticipating something like this. They were anticipating a real bundle where you take a music product that you can buy alone, you take a non-music product you can buy alone, and you marry them together for a discount. That's what the court intended. What Spotify is doing is trying to manufacture a bundle that a customer did not choose. As the trade association that represents all these songwriters and music publishers, we have filed a complaint with the Federal Trade Commission or the FTC because we believe what Spotify is doing involves a fraudulent and deceptive business practice that is prohibited by law. We also have referred that FTC complaint to 10 different state attorneys general.

And furthermore, we have sent this to six leading consumer advocacy organizations to also investigate whether or not what Spotify is doing involves a fraudulent and deceptive business practice. In addition to those three things, NMPA has also asked Congress to take a look at changing the law that makes us license and give music publishers and songwriters more freedom to make their own decisions about whether or not they want to be in business with a company that treats them like this. You know, David, you explained to us how songwriters get paid, that it goes back to player pianos and this high council copyright royalty board, these three judges in D.C.

It sounds sort of like something out of a fantasy novel. Is that part of the reason Spotify can maneuver in this way? Because there's this small, unknowable government outfit that is determining how royalties work in the United States. Would it be different if songwriters got to choose how much they license their music to Spotify for themselves? It's a great question, and I just want to be very clear. Record labels that represent recording artists are in a free market. They're not regulated by this law, and Spotify is not doing this to them. That's because if you're a record label, you can actually say no to Spotify, and therefore

Spotify has to treat them like business partners. But for songwriters and music publishers, the law makes us license our songs whether we want to or not. I think Spotify is counting on two things. They're counting on ignorance from their customers, and they're counting on human nature is not going to go through the exercise of going through a bunch of steps to get back to where you started. And what I mean by that is that Spotify has now come out and said that they are going to offer a music-only alternative. But they're going to make these 44 million customers who were automatically shifted into a different plan have to elect to quit their current plan and sign up for a new one just to get back to where they were. And I think Spotify is counting on not many people will do that. You know, Spotify would be nothing were it not for the songwriters' work that they bring to people.

And that being said, I can only really think of one or two songwriters in the history of this platform that have really taken a strong stand against it. Neil Young and subsequently Joni Mitchell. Do you think artists still have the power here? And if so, why don't they flex it more? So one of the challenges is that interactive streaming or digital music services like a Spotify are now the number one source of income for the music industry. And Spotify is the largest of them. So in order to take a stand for a high-profile artist, you're asking them to give up their number one revenue source to make a stand and on behalf of songwriters, which sometimes those artists are also songwriters, but sometimes they're not. It's a very difficult thing to

ask anyone to do is to hurt your own economic interest to stand up for others. I think you might start seeing more of it, but it's a very difficult thing to do. David Israelite, president and CEO of the National Music Publishers Association, the NMPA for short. We reached out to Spotify to hear what the company had to say, and they were like, I'm working day, cause I'm a singer. No, no, no, they actually had a lot to say, including that they notify users of any changes to their service, and they certainly notified everyone about this one. Spotify said they think that bundles like the one we spoke about with David attract more customers to pay for subscriptions, which means more people paying for music overall.

And they reminded us that Spotify is on track to pay publishers more this year than last. Our program today was produced by Peter Balanon Rosen. We were edited through the grace of Matthew Collette. Fact-checked and openly mocked by Laura Bullard. Mixed and mastered by Rob Byers and Andrea Christen's daughter. It's Today Explained. Thank you.