Back in December Spotify’s head honcho in France, Antoine Monin, gave a blistering TV interview saying that the French government’s proposal to add a small levy to streaming subscriptions to help preserve a sustainable music industry in the country was a “monumental strategic error” and that, as a result, Spotify might “disinvest from France”. It then went on to rage-quit a bunch of festival sponsorship partnerships, and slash money allocated to artist marketing initiatives in France, in retaliation.
Three months on and the levy is coming into effect. Needless to say, Spotify doesn’t seem to be shutting up shop in France – despite laying off nearly 2000 employees globally just days before Christmas.
It has, however, true to form, rolled out yet another exhaustingly histrionic memo lashing out at what it calls the “CNM Tax”, because the cash generated by the levy will be administered by France’s Centre Nationale de la Musique, or CNM. “The French government decided that digital music streaming services will now have to pay a new tax in order to finance” the CNM, it declares.
“Perhaps you’ve never heard of the Center for National Music”, its press release then disingenuously muses, before laying into the organisation’s budget and operating costs. “With the creation of this new tax”, whines Spotify, the company “would be required to give approximately two thirds of every euro it generates to music rights holders and the French government”. This is a “MASSIVE AMOUNT” shrieks Spotify, and “does not allow for a sustainable business”.
Given that Spotify used to make a big thing about the fact that it pays out about 70% of the revenue it generates to music rightsholders, it seems a little odd that Spotify is now trying to couch this as a negative drain on its precarious finances. Percentages and fractions are hard though, so maybe Ek hasn’t realised the two thirds is actually 66.67% – a full 3.33% lower than 70%. Numbers are hard!
That said, the company did actually switch to saying it paid out “two thirds” a while back, so maybe today’s horrifyingly unfair two thirds is different to the “we are great, look how much money we pay people” two thirds that they’ve been trumpting for the past couple of years. Maybe they actually meant four sixths and something got lost in translation between Swedish, French and English.
“As we’ve long said”, sobs Spotify, “we simply can’t absorb any additional taxes. Even after making the difficult decision to reduce our artist marketing budget and support of French music festivals” the MASSIVE AMOUNT OF TAX that Spotify is required to pay “continues to impede our ability to operate in France”.
As a result, anyone using the streaming service in France is going to have to pay more, says Spotify – though it doesn’t say how much more. Maybe it doesn’t have that number to hand right now, or maybe the number isn’t actually as important to Spotify as the opportunity to grandstand its whining about how unfair everything is and take pot shots at an organisation that actually supports artists and music making.
Spotify, of course, recently demonetised a whole swathe of independent music creators by imposing a ‘1000 streams from 500 unique users’ threshold – which may have devastating consequences for entire genres of music – and in particular specialist, traditional and classical music, as well as non-English language music creators with smaller audiences.
In reality, it’s more likely that it just doesn’t want to highlight the fact that the levy is just 1.2%. So a €10.99 subscription will go up by – brace yourself – a MASSIVE HORRIFYING AMOUNT of just 13 cents. That’s a whole €1.56 a year.
On 27 Jul 2023, Daniel Ek sold 675000 shares in Spotify for $100,001,250.
On 25 Oct 2023, Daniel Ek sold 400000 shares in Spotify for $64,208,000.
On 7 Feb 2024, Daniel Ek sold 250000 shares in Spotify for $57,505,000.
As of 31 Dec 2023, Daniel Ek held 30,856,376 shares in Spotify. Taking into account the February disposal of 250,000 shares, he would appear to hold 30,606,3756 shares in the company which – at today’s share price of €254.50 a share – are worth €7,513,865,308.
That’s enough to pay the levy for every single individual person in France – Spotify subscriber or not – for 71 years.