Spotify Accused Of Ripping Off Artists, Harming Users’ Privacy

Spotify came under fire this week for a combination of its payment model to artists and for a privacy policy update that led to the Register declaring that Spotify was “worse than the NSA.” The new terms were reported to give Spotify, the streaming music giant, the power to know everything about users from who they know, where they go, and what they like.

The decision to roll out the changes without much prior explanation may be especially damaging to Spotify as it runs a profitable subscription-based business. Users have become accustomed to making some privacy sacrifices on free services, such as Facebook, but are less enamored when they pay for the service, as is the case for many with Spotify.

Fans and critics alike took to Twitter in the aftermath of the new Spotify privacy policy.

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To give credit to Spotify, CEO Daniel Ek took to his blog to explain the Spotify privacy policy, he and will no doubt have put many Spotify users’ minds at ease with his official statement on the issue.

“Let me be crystal clear here: If you don’t want to share this kind of information, you don’t have to.”

Spotify doesn’t have a track record of adding new features that impact privacy, with a setting defaulted to “opt in” to the new feature, so for many Spotify users, this clarification will put the issue to bed. It still makes sense for Spotify users to continue to monitor the story, and ensure their settings within the app are consistent with the amount of data they wish to share with Spotify. In the aftermath of the Ashely Madison hacks, and many lower profile incidents involving large companies and the data they hold on us, it makes sense to only share as much as is absolutely necessary.

It’s also worth noting that, as reported by Fortune, certain elements of the data they share cannot be opted out of as they are part of agreements Spotify has with mobile partners and advertising networks.

Artists have long complained about the amounts paid by Spotify for their “airtime” on the service. Sharky Laguana, in a post on Medium, accused the service of “ripping off” users and indie artists alike with their current model.

As it stands, almost all the money allocated by Spotify to artists and record labels is determined by the plays of a small number of heavy users. That means if you only listen for a few hours a week to your favorite artist on Spotify, they may only get 10 percent of your subscription, and the other 90 percent goes to artists listened to by that troupe of heavy Spotify listeners.

There isn’t an easy solution to the problem, but the article likens it to a person buying a CD, instead of listening to it on Spotify, and the store automatically gives 90 percent of the money to a different artist unless the purchaser agrees to listen for a minimum amount of time. That would make no sense in the physical world, so one suspects it’s an issue Spotify will have to wrestle with as it becomes more influential in the music world.

What do you think about how Spotify rewards your favorite artists? Do the new Spotify privacy changes concern you, or are you happy with Ek’s clarification? I’d love to hear from you.

[Photo by Andrew Burton/Getty Images]