Trapital - a platform or a publisher?

a platform or a publisher?

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Hey! You should have gotten this memo on Monday, but sending again in case you didn't.
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I hope you enjoyed last week’s essay on Spotify. If you haven’t already, you can read it here. Today's memo is also on Spotify, specifically about Joe Rogan, Spotify’s response, and what’s next.

I know, back-to-back memo’s on the same company! A rarity for Trapital. I actually had another article in mind, but I’ll hold off on that for now. There’s too much going on with Spotify not to break it all down.

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new pod: Junae Brown

I had a great conversation with the “Beyonce of Marketing.” Junae used her record label experience to start a marketing agency that helps brands tell their true story. In this episode we talked abour her journey, how she branded herself, and we kept it real about the music industry, and some people overlook about the business of music.

bonus: new creator manifesto

Last week Tuesday, I shared the audio from the webinar I co-hosted with Gina Bianchini, Mighty Networks CEO and Zoe Scaman from Bodacious. We talked about the creator economy, the shift toward community, the burnout that many creatives feel, and what to expect next, especially as web3 gains traction. If you need a primer, check out their independent study on the creator economy.​

Listen to the Trapital Podcast here:

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Spotify and the neutral platform myth

Spotify’s relationship with The Joe Rogan Experience (JRE) always felt like it would reach an inevitable boiling point. Spotify had already removed episodes due to misinformation, but there was no promise that future episodes would do the same. The outrage over Rogan using the N-word isn’t new. It’s been almost ten years since the first YouTube video reaction to Rogan’s use of the word. But the timing lined up to the current moment, which maximized the impact.

Spotify’s CEO Daniel Ek released a company-wide memo to address this. His response felt similar to responses from Facebook, YouTube, and others big tech companies regarding content moderation. They often tell the public that they are platforms, not publishers. These platforms often remove the most extremely heinous content imaginable (e.g. child pornography), but give a pass to other problematic topics that don’t fall within their moderation guidelines.

Here a segment of Ek’s memo regarding Rogan:

Let’s unpack this. First, as Kara Swisher said yesterday, the terms ‘silencing’ and ‘canceling’ are false equivalencies that distract from the situation. Spotify can’t silence or cancel a podcaster whose audience would likely grow if it went back to being available on all other podcasting platforms. (Especially since Rogan has since been offered a matching deal from Rumble, which wants to distribute all of his content without censorship).

Second, Ek’s line “we are not the publisher of JRE” is a bit subjective. He said something similar at Spotify’s recent town hall. He sees Spotify as the publisher for The Ringer, Parcast, and Gimlet, since Spotify acquired those companies and has editorial control over them. But since Spotify didn’t acquire JRE, he’s sees that relationship more like any independent podcaster who uploads their show to Spotify.

But that’s a difficult stance to have given Rogan’s $100 million exclusive contract with Spotify, which Ek has alluded to. It’s no surprise that content moderation is harder for podcasts than text-based social media. It’s a less tractable medium. As a result, podcasters are more likely to get away with saying things that don’t fly on social media platforms. But it’s not unreasonable to expect Spotify to have higher standards for the podcast that has been one of its biggest growth engines for the past two years.

Also, Spotify’s ‘platform vs publisher’ take implies that the company would treat Rogan differently if it had acquired JRE. But let’s say the podcaster in question instead was The Ringer CEO, Bill Simmons (The Bill Simmons Podcast) or Gimlet’s Alex Goldman (Reply All). How would Spotify have acted differently in those scenarios?

the $100 million commitment to marginalized groups

Later in Ek’s memo, he made a $100 million commitment to support historically marginalized groups:

I’m eager to see how this $100 million will be used. It’s the same amount of money that Spotify committed to Rogan. I hope it doesn’t get used as a future talking point to say, “see, we gave just as much to Rogan as we did to marginalized groups!” as a way to minimize the perception of its relationship with Rogan. I also hope it doesn’t get used to support fringe or problematic podcasts “from both sides” in an attempt to appear neutral. But time will tell.

the ask for forgiveness not permission

Big Tech’s M.O. has been to ask for forgiveness, not permission. Spotify has followed a similar beat, but has acquiesced more than others due to its business model. It made revenue share agreements with the record labels and publishers since the streaming company doesn’t own any music. Podcasting has been its attempt to capture more upside, but Spotify’s leading podcaster has sparked a public outcry that may linger for some time.

Neil Young’s decision to take his music off Spotify may be seen as a catalyst, but he’s in a different category. His chart-topping days are behind him and he sold half of his catalog last year. But if artist like Taylor Swift or Adele ever want off Spotify (which may not be surprising given the reluctance they once had to the platform), it could start a bigger domino effect.

In my essay Inside Universal, Sony, and Warner’s Arms Race for your Attention, I wrote about how the record labels and Spotify both want to gain leverage through partnership with others. Spotify has done that through non-music audio, which the majors have done it through its licensing deals with social networks and digital environments. If an A-List major label artist wants off of Spotify, they may get pushback from the label execs today. But that could change eventually as the labels are less reliant on Spotify (and vise-versa).

Joe Rogan has become a symbol for Spotify’s current challenges. But Rogan’s listenership on the platform continues to grow. The company is now incentivized to distribute, promote, and “publish” and promote more content that attracts the JRE listener and others with similar listening habits. It would be foolish to think that this is the last of this debate.

As I wrote in last week’s essay on Spotify, the company has a considerable amount of power in its quest for attention in audio. The company has a ton of power and potential. How it chooses to wield that power will set the tone for its future.

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the best music marketing of 2021

Our friends at Music Ally are back with their most popular report of the year: The Best Music Marketing Campaigns of 2021. It features case studies on Doja Cat, Dua Lipa, Pop Smoke, Death Row Records' 30th Anniversary, and a whole lot more. Each page has campaign budget data, results, and key learnings. It's 70+ pages of insights for anyone in music marketing--from the indie artists just starting out to the major record labels hoping to top the charts.

These reports are normally for paid subscribers, but Music Ally let Trapital readers get free access (thanks again!) You can get the report here.

If you're not already signed up, Music Ally is one of my go-to sources for music industry analysis and reporting. You should sign up for the free weekly newsletter, The Knowledge.​

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coming soon from Trapital

Podcast: Tuma Basa. People have requested an episode with Tuma for a while, and it’s finally here! We talk about YouTube, streaming, Black music, and a whole lot more. Drops on Friday!

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