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Congress members not hugely impressed with Spotify’s response to Discovery Mode concerns
By Chris Cooke | Published on Tuesday 10 May 2022
The three members of US Congress who recently wrote to Spotify expressing concerns about the streaming firm’s Discovery Mode scheme have told Billboard that they are not entirely happy with the response they have received.
Discovery Mode is the Spotify initiative where artists and labels can inform the company’s algorithm about priority tracks, but in return have to accept a lower royalty if the algorithm then generates some plays. Although some labels and distributors have been positive about the scheme, there has been plenty of criticism of it all too, including from within the political community.
Among the politicians raising concern have been Congress members Yvette D Clarke, Judy Chu and Tony Cardenas. In a letter to Spotify boss Daniel Ek last month they raised concerns about the impact of Discovery Mode on both artists and fans.
In terms of artists, their letter stated: “Choosing to accept reduced royalty payments is a serious risk for musicians, who would only benefit if Discovery Mode yields more total streams for an artist across their entire catalogue, not just the track covered by the programme. And if two competing artists both enroll their newest track in the programme, any benefit could be cancelled out, meaning that the only profit goes to your company’s bottom line”.
And as for fans, they added: “Spotify fails to tell consumers that they are listening to paid content when it feeds them Discovery Mode songs. We believe there is no meaningful distinction between paying a lower royalty rate and accepting payment for placement on the service. In fact, Spotify advertises to listeners that its radio feature offers ‘continuous music based on your personal taste and no ads if you are a premium member'”.
Among other things, the politicians asked for more transparency, so that artists are aware just how many other music-makers and labels are using the service, and fans are more aware that music might be pushed to them as part of what is basically a commercial scheme.
Spotify has responded to the Congress members, bigging up the positive feedback the company has received from those artists who have been part of the Discovery Mode pilot, who on average have seen a 40% growth in listeners.
As for the concerns that subscribers were unknowingly getting music in their ears as a result of the promotional initiative, Spotify’s letter said that it had published a blog post all about Discovery Mode and had an ‘About Recommendations’ blurb that states that commercial considerations might influence what music is recommended.
The latter part of the response in particular didn’t really impress Spotify’s Congressional critics. They told Billboard in a statement: “The response we received from Spotify regarding consumer disclosure points to a blog post and vague language about commercial considerations that are buried in their terms of service and several clicks deep on their application. We will welcome a constructive dialogue with Spotify but won’t back down from our belief that they can do better to abide by the clear rules of the road for online disclosures”.
And to that end Clarke, Chu, and Cardenas plan to continue monitoring how Spotify’s Discovery Mode develops. “We have seen time and again that as digital platforms get bigger and more powerful they need to be checked by scrutiny from Congress on behaviour that can harm consumers and competition”, they added. “Our goal in sending this letter to Mr Ek is to make sure, as Spotify continues to grow, that its leaders understand that they cannot be the sole arbiters of what is good for music creators, their subscribers or the general public”.
