Guest post by Chris Castle of Music Technology Policy
Streaming services like Spotify are faced with a squeeze–how can they be more like Facebook? That means how can they get really get into that Web 2.0 game by getting more people to work for them for free while retaining 100% of the revenue for selling their work product? Or better yet, get people to pay them real money in return for promo bucks? (Or in the Lefsetz world, Bitbob.)
Some people think that Spotify will or should “start a label”, like that’s as easy as buying razorblades. Remember–Spotify’s top executives are richer than Croesus and got that way while stiffing songwriters in the millions and even managed to change the law to create a new safe harbor so that they could continue to do so. Talk about gaslighting!
Why would such people want to get their hands dirty and “start a label”? More likely they would adopt the “No Records” model.
No Records was an imaginary label I dreamed up on the handful of exceptionally frustrating days at A&M. The No Records business model was to sign major artists to record the next record they released after they got dropped. No Records signed Bruce Springsteen, the Rolling Stones, Drake and so on and promoted itself as having all those artists signed, but never released any records as long as those artists were signed to another label. Which means, of course, if you were a No Records executive you did no work because you had…no records. And if by fate you found yourself with an actual record delivered to you, they you would get laid off and paid as a consultant for a few years to not work any record that was delivered.
Now this is a perfect business model for Spotify. Kind of a small batch AI-driven artisanal curation. No one would ever have to find out that Spotify executives know nothing about developing or breaking artists, but they could promote the artists they signed to No Records by playlists for the current records of their future artists.
Because that’s the key, you see. To have no records. Ever. But Spotify could tell Wall Street they were starting a label to compete with real record companies and journalists would dutifully write stories about how Spotify was a threat to the record company ecosystem. With no records. While they continue to sell stock to the greater fool.