Aligning incentives between Spotify and artists with smarter payouts.
Today’s music industry has witnessed the rise of streaming as the predominant method of music consumption, necessitating an entirely new system for compensating not only artists but also record labels, distributors, and producers. With everyone vying for a share of the same revenue, streaming has also created a zero-sum game with misaligned incentives. In our paper, we explore issues within Spotify, the leading music streaming platform. First we expose problems with Spotify’s current compensation system, and then we propose and justify comprehensive solutions that better align the incentives of Spotify with those of its artists and users.