Checking your pulse?
-Sorry? -Checking your pulse?
No. Thanks for coming on a Sunday.
No worries.
Is Jim here?
-Yes, he's waiting in the pavilion. -Okay, good.
-Jim! -Daniel.
-Good to see you. How are you? -I'm great, and you?
-Good. Thanks for coming. -No problem.
Always a pleasure to come over here and get down to the nitty-gritty.
-Yeah. -How's Arsenal doing?
Terrible, they lost again.
-They'd be better off with you in charge. -Your words, not mine.
So…
As you know, we have an urgent need to maximize revenue,
or at least bring down our cost base.
If this business is gonna thrive, we have to reduce the cost of the music.
That's why we spent the last few years testing Discovery Max,
and now, finally, we have some useful data.
Yeah, and…?
-Fucking fantastic. -Yeah?
The artists have seen their followers go through the roof. They fucking love this.
-Alright. -When they get the promotion boost,
they are seeing listener growth of 40, 50, even 100%.
Concert sales and merch sales are going up…
Everybody who signed up to it said they'd do it again.
Why don't we roll it out across the whole company?
Because it's highly contentious.
We only promote bands that agree to hand back a cut of their royalty.
The artists consent to everything. We're not charging anyone a penny.
It's a win-win situation, a new business model for a new kind of music industry.
The Musicians' Union calls it payola.
And Senator Madison Landy of the US Senate
wrote Spotify a letter expressing significant concern
that we are participating in anti-competitive activities.
Well, that's not fucking good.
Bottom line is that 70% of everything we bring in on the music,
goes straight back to the record companies. 70%!
What other business has to deal with those kind of costs?
Discovery Max is Spotify doing things its own way.
It's us showing innovation, reshaping music.
It's us putting power into musicians' hands.
By halving their royalties.
If we don't push the boundaries, we are not gonna survive.
Listen, what you and your team have done is amazing, and I love it,
but we do need to take it step by step. I mean…
For now, let's just… let's roll it out in a way that keeps everyone onside, okay?
-Hi. -Hi.
-How was the meeting? -It was good.
Is this the new architect?
-That's exactly what it is. -Yeah, okay.
-Are we tearing it all down? -Yes. Yes, I think so.
Am I picking the kids up today?
-No. No, your mom will do that. -Oh, okay.
Hey… You are not worried? About the protests?
-No. -No?
But I can see that you are.
I'm just worried that they will try to blame you.
No, they won't.
Look at this. This singer has been on Spotify since the start.
You know why she stays? Because she knows we're the best.
It's as simple as that. I promise.
Spotify, what we want…
A small but persistent group
has been protesting for three weeks outside Spotify's headquarters.
We are all activists now. They have forced us into it.
The protest leader, Nadja Johansson, a former musician,
who feels forced to act because of the situation…
Let's see… You know what? Let's do this later.
You have to go to school. I don't want you to be late today.
Can I have an iPhone?
I can't afford an iPhone, honey.
But all of my friends have one.
Spotify, what we want…
I know… but…
Hey, there's food in the fridge.
I'm working late tonight.
And after work, I have a gig.
And the more gigs I get, the closer we are to an iPhone.
-Right? -Yes.
Go on. Here, don't forget your bag.
I'm standing here with Spotify's CEO Daniel Ek.
What do you say to the shareholders who worry about the negative reactions?
No, I'm not worried about that.
There will always be people who are opposed to success…
The doors are closing.
First floor.
-Great gig. -Thanks.
-I've transferred the money. -Yes, great. See you.
See you. Take care.
You've only given me half. What's going on?
I didn't sell as much beer today as last time or the time before that.
Hang on. I played a gig that you hired me for.
Yeah, but do you want me to go bust just to let you play?
I mean, you get free PR by playing here. People go home and stream your music.
That's great for you.
Okay, I… I don't know how this will turn out,
but I have reached a point where there's nothing more I can do.
I'm a musician.
I have released and written six albums in the last ten years.
I've had many hits. My songs are played close to 200,000 times a month on Spotify.
But I still can't pay my rent.
I take all the gigs I can get, I have a job on the side,
everything for the privilege to make music.
Even though I tell myself every day that soon things might improve,
if I write the right song, or end up on the right playlist, things will change.
But the truth is that the system is broken.
The music industry made 23 million dollars last year.
The record companies thrive.
They even made more money than they did before piracy.
The ten people who make the most money in Sweden
come from the same streaming company every year.
Despite that, the artists who create the music for their platform
can barely survive.
Daniel…
Today you liked one of my songs.
You added it to your playlist, which is awesome.
But if you really liked it, sit down and talk to us.
Help us have a new discussion about the streaming business.
Help us create a new system, a music industry where we can actually survive.
Nadja? What's going on?
I love you! You are awesome! Oh, you are so great! Thank you!
-Have you completely lost it? -No, your post!
You've done more with one video that we've done with 15 protests.
And it's perfect that it was you!
This is really good to hear, but I have to get Naomi ready for school.
Then I've got to go work, so I…
Are you kidding? This is so fucking big!
What the hell are you talking about?
-Everything okay? -Absolutely.
I know this is something you dismissed a long time ago and…
Well, you may not like me bringing it up, but considering the situation and…
I'm sorry to interrupt, but have you seen the news?
-No. -Do it.
Bobbi Thomasson, musician and childhood friend of Daniel Ek
posted an emotional and personal video on her Instagram story yesterday.
Daniel, today you liked one of my songs.
You added it to your playlist, which is awesome.
But if you really liked it, sit down and talk to us.
Since last night, the video has been shared more than 12,000 times,
and has the support from other musicians.
Everybody, this is Bobbi Thomasson, the woman who knows how to get to Daniel Ek.
-Hi. -Way to go, girl!
We've been busy for months,
but nobody's cared until now, after your post.
-Bobbi. -Rhonda.
Hi.
We put your video on our feed.
It's had over 20,000 likes in under two hours.
The hashtag Scratch the Record, is trending since yesterday.
We managed to connect. Now we are all in.
No, no, no, I don't think I'm the right person for this.
I just posted a video because I was tired and cranky.
Yes, sure you are.
We are all activists now. They've fucking forced us into it.
Well, this may sound a bit strange,
but I know Daniel Ek personally, okay?
We grew up together, and I mean, I support you 100%, of course,
but I posted the video because I wanted to start a dialogue.
And regardless, I have to wait and see what he says.
So… you haven't checked your Instagram yet?
He stopped following you this morning.
Daniel isn't interested in having a dialogue.
None of them are.
They want us to shut up and they want us to go away.
Just so you know, there's another protest outside the headquarters.
Okay.
Daniel, would you mind looking at this?
Yeah. What's this?
It's a proposed sale of Spotify.
I know that this isn't something you've considered before,
but every CEO, every founder, has to choose their moment.
-You've had an amazing journey. -No, I won't sell Spotify.
You hired me to have somebody who always tells you how things are.
As things are, the market is still in our favor.
But what will you do when the market value drops below the IPO?
I hired you because you are pragmatic and stubborn, but this is too much.
Okay, so how do we get out of this one?
We'll have to borrow more.
Daniel, last year we borrowed one billion dollars.
We'll borrow more to get through this.
We'll do some acquisitions, we'll invest in innovative tech, like we always have.
This is your way out.
If you sell Spotify, you protect your legacy.
You protect your brand, you protect what you have tried to build…
I won't sell Spotify, I…
I haven't done what I wanted yet.
-Daniel… -What?
Scratch the Record! Scratch the Record!
Okay, keep your heads down. Security is here.
Scratch the Record! Scratch the Record!
-Daniel, this is outrageous! -Yeah, I know.
-Just, just relax, okay? -Relax?
The business model we have is fine.
We have new content, we'll give them more support and soon we'll have Discovery Max.
There's no reason to panic.
I'm not here as Daniel Ek's enemy.
I'm here as someone who used to know him,
and who believed in the promises he gave me and other musicians.
Scratch the record!
I'm here today to say that enough is enough.
I have told my friends to be patient.
I've really tried to believe in him.
But the average salary for an employee at Spotify is 130,000 dollars,
while the musicians on his platform are on their knees.
Daniel Ek, it's time for you to "Scratch the Record".
It's time for you to sit down and talk to us for real this time.
-Unbelievable. -Yeah.
This is distracting the office. It's a public disturbance.
-We should call the police. -We can't call the police.
This is a platform for musicians. What will it look like if they're arrested?
Exactly.
Okay, it looks like the police decided to turn up anyway.
Shit.
Scratch the Record!
Let her go!
This is bad, Daniel.
It's only a story because we're in Sweden.
We must not forget we are listed in New York.
We have more Chinese shareholders than Swedish ones.
But this may affect your chances of borrowing money. You know what?
I'm working myself to death and I run from bank to bank.
Do you know what the first thing they ask about is?
These protests.
Daniel… you have made it clear that you don't want to sell Spotify.
You want me to find more money that will enable new innovations.
If that's the case, you will have to make sure this doesn't get any bigger.
One thing I've learned in politics…
"Never let yourself become the story."
-Do you want to play with us, Daddy? -I'll play later.
Hi.
How are you?
You're seen everywhere, Daniel.
These protests, they won't die down.
And all those damn opinionated people who say Spotify needs to change,
-what do they mean? -Are these the new designs?
-Yes. -Mm.
Yes, these are the designs.
Ernst was a bit worried that you might think it's a bit too big.
Don't compromise. I think we should make it even bigger.
Did you get hold of Sundin?
Okay, tell that traitor that I'm coming now.
-Hi. -Hi!
How are you doing? Nice to see you.
-And you. -Yeah. How are you doing?
-Yeah, well… I'm alive. -Yeah, great.
Discovery Max looked… I saw some test results. They were…
Hey, this is the deal. I need you to do something.
Okay…
I need you to call Bobbi Thomasson.
I want you to explain to her that this thing she's doing,
it can only ruin things.
It's based on a complete misunderstanding of how Spotify works.
I haven't seen Bobbi for about ten years, I think.
I can try to get hold of her contact details, and then you can…
Hold on… Try?
-Yes, I can try to get hold of… -She was your artist.
You were the one who signed her. You promoted her.
-You can contact her. -No, I can't.
I get it.
You use them, sign them, earn money from them,
and when you're done, you forget them.
When Bobbi is upset about her earnings,
does she turn to Universal or BMG?
Does she turn to any of the people who are responsible for what she earns?
No, she and her fucking friends set up camp outside my office,
throwing all their shit at me.
Did I sign her? Did I encourage her?
Did I encourage any of these millions of people who live in that fantasy
that you have sold them, that they will be the next Drake, Taylor Swift,
getting them to sign shameful contracts they are too young to understand?
But who do they hold responsible? Me!
But you don't care! Of course not! Why would you?
You and the record companies got what you wanted, 70% of everything we earn.
You've got a great deal there.
And you got a stupid bastard who agreed to it all.
I'll be a while, but you can wait here.
At a bistro in Rågsved?
-Why are you here, Daniel? -I think we should talk.
Now? When I have a gig?
I don't care that other people protest. But you, Bobbi, you know me.
That's why I joined them. If you don't know someone, you won't listen.
But what is it you want me to listen to?
People who refuse to accept the world has changed?
Nothing has changed! It's a fucking nightmare.
Maybe you haven't understood how to make the most of Spotify.
-Please, don't do this. -Listen to me. I'll just say one thing.
If you let me… I will show you how to make the most of Spotify.
And then? Will you tell all the other 1.5 million artists your secrets, too?
You remember how it was? You told me that Pirate Bay uploads all of your songs.
So we should be grateful that they aren't stealing from us like 15 years ago?
No, that's not what I mean.
You're talking about your journey…
But what about our journey?
All the millions of musicians who have no control of the payments.
It can't be my responsibility to help the careers of all the artists.
Why not? You are the most powerful person in the music industry right now.
You are the system and that's what you wanted.
You wanted to create the biggest music platform.
-Bobbi, it's time. -Okay.
-Nice place… -It's crap.
This place… The whole point is that nobody listens.
Bobbi, let me help you.
Bobbi, come on.
-Okay. -Thanks.
Thank you for staying for the whole gig.
What's wrong?
I understand that you want me to… to change Spotify.
But the changes that you want me to do… would be our downfall.
It doesn't have to be that way.
You have your songs, Bobbi…
Your music… That's what Spotify is to me.
Everything I am is a part of that.
And it doesn't matter what you say…
I will never let anyone take that away from me.
Scratch the Record.
…is now spreading around the world.
The Swedish artist named Bobbi Thomasson...
Scratch the record.
This is bullshit.
You know they only brought us here to humiliate us.
The US Senate are meant to humiliate us.
I'm not supposed to be here. I'm not American.
Daniel, you've got this.
You know what it is? It's theater.
You're the CEO, Daniel.
You run the company.
If we lose this argument in front of the committee,
our whole business could be screwed, so please, just don't resist.
Yeah? Focus. Stay cool and calmly answer everything they throw at you.
We're here.
What kind of power does this committee have?
The kind that can recommend a fixed price of a stream,
regulate everything and destroy our business model.
You have to focus on a Senator Landy. This is her hearing. She pushed for it.
She's staked everything on this. Don't let her win.
Daniel?
What the fuck is she doing here?
Forget about her. She's irrelevant.
She's here as a representative or some shit. Who cares?
You have to shut Lanley down.
What about the other guys?
Keep them engaged. As long as they make eye contact with you, we're good.
As soon as they start avoiding your gaze, we're fucked. And Daniel…
you can do this.
Do you swear to tell the truth, the whole truth and nothing but the truth,
-so help you God? -I do.
Could you please identify yourself for the committee?
My name is Daniel Ek and I'm the CEO and co-founder of Spotify.
Mr. Ek, you previously described Spotify's mission as:
"To unlock the potential of human creativity
by giving a million artists the opportunity to live off their art."
Yes.
How is your progress towards that?
Excellent. Our top tier club of artists who can support themselves from streams
has doubled in the last three years and tripled since 2015.
That's impressive…
So, at your current rate of growth,
you would hit that one million figure in… just under 75 years?
Your business model just doesn't work for musicians, does it?
That's not true.
What are the average earnings of an artist not in your top tier?
Well, the number of artists changes so fast for us, you know.
Mr. Ek, from your own data, I can see here that the figure is…
12 dollars a month.
-Could you live off that? -Well, that number is not verified.
It's taken from your own results.
Excuse me, Madam Chairwoman. Mr. Ek…
Isn't it the case that Spotify is just one platform among many?
Yes, that is correct. Spotify is one platform among many,
and artists have several platforms to earn an income from.
It's not fair to put all that on Spotify.
What percentage of the streaming market does Spotify control?
I believe it's around 25%, Senator.
You control almost 45% of the US market alone.
In some countries, your share is as high as 60%.
Five times as many users as your nearest rival.
To all intents and purposes… you are a monopoly.
We are not a monopoly.
No artist can take themselves off your platform,
no artist can risk losing exposure to your audience.
You control streaming and you control the fate of musicians.
I'm sorry, Senator. Was there a question in there, or…?
Do you believe the size of your business model creates a problem for artists?
Spotify is about partnering with the artist,
and build the music industry with them and create a future together.
When the Copyright Royalty Board awarded songwriters
their first raise in almost 50 years, how did Spotify react?
-We sought clarification. -You sought clarification?
You took them to court. You lodged an appeal against them,
and you got lawyers to argue for a cut in what they're paid.
Does that sound like a company that supports artists?
It sounds like a company that has its own approach,
but we support songwriters.
We partner with them, we champion them.
You use your size and marketing budget to silence your critics, Mr. Ek.
At every opportunity, you do everything you can to drive down
the share you pay musicians.
Don't you think you have a responsibility to these people?
I believe that musicians need to understand
that I'm the best friend they've got.
I'm the only one who's not lying to them.
I'm the only one who's honest about the fact that we can't go back,
that this is a completely new industry with new rules and new principles.
I'm the one working day and night to create the opportunities
they need to achieve their dreams.
What is Discovery Max?
Discovery Max is a perfect example.
It's a service that helps artists.
Discovery Max is a service,
in which you take a bigger share of the artist's royalty,
and in return offer them extra promotion.
Well, Discovery Max is an exchange between Spotify and the artist.
It is straight up music industry payola, and it has to stop.
You're splitting hairs, Mr. Ek.
You reduce the artist's royalty and in return you fix the game.
We're not fixing anything.
The major record companies own almost 20% of Spotify, don't they?
It's possible. That's… It's around that number, yes.
So, the musicians are on the labels,
the labels own part of Spotify, Spotify decides which musicians get promoted,
and then the income from the streams goes straight back to those labels.
What part of that does not sound like a cartel?
We're not a cartel.
You control the market.
You're in bed with your suppliers.
And then, at every turn, you use your reach and your technology
to drive down the share that you pay musicians,
the people that depend on you and your platform to make a living wage.
Can you seriously sit there and tell me that in any other part of the world,
this would be considered acceptable?
There's a lot of negative comments. The word cartel seems to resonate.
It's a few voices on social media, nothing to…
Let's hope they put her under the kind of pressure they put you under.
Would you please identify yourself for the committee?
My name is Bobbi Thomasson.
I'm a musician, but I'm here today
as the US and global head of a musicians group called "Scratch the Record".
That's a musicians' advocacy group?
Yes, that's correct.
And what are you advocating?
When our music is used, when it's streamed,
we argue that musicians deserve to be paid a fixed price per stream.
And we want that to be recognized in law.
We would all like to get paid more, but that doesn't mean we can change the law.
Musicians have lobbied streamers for a decent cut,
but all we ever get are words. We need a law.
In every generation, there are winners and losers.
And people say that's just how it is.
But this Senate has always been able to tell the difference
between change and exploitation.
Miss Thomasson, with all respect,
you're not a front line worker, you're a musician and you chose to do that.
So you want musicians to accept that music is precious,
but they're interchangeable?
-That's not what I said. -It is what you said.
It's what everybody always says.
But if you want to enjoy something,
you have no right to ignore the conditions it was made in.
Spotify is… It's just a platform.
Spotify churns out a product to millions of phones and laptops,
like a factory,
and the workers that supply that product are musicians.
Spotify is always telling us how grateful we should be for that exposure,
but I'm here to say that you can't pay the bills with likes.
We don't care how many analytics you build,
how many different ways you tell us
we have more listeners in Boston than Stockholm.
When our work is used, we want to get paid.
Why is that this Senate's business?
Why is that not for the market? Or for the consumer?
Because, in 1938,
this was the Senate that introduced a statuary minimum wage for the employees
of the new steel and oil industries.
Senators saw that the world had changed.
A new law was needed.
That minimum wage looks obvious now.
But the bosses fought it.
Law makers had to see that the oil companies simply had too much power.
That is exactly where we are today. This is about the big monopolies of today.
It's about whether we have the courage to see that musicians
are no different to oil and steel workers.
We deserve the same rights…
the same recognition… and until we acknowledge that…
streaming will always be exploitation.
Bullshit. Exploitation? The law? Who the fuck does she think she is?
She's someone who knows she's got the support of several senators.
So what if she does? So do we. We have…
Lobbyists. We have influence. Do not go and talk to her, Daniel.
I can't just ignore her anymore. Just… stay calm.
Hi.
Well, that was… You were impressive.
-I know you don't mean that. -Yes, unfortunately I do.
I'm just the messenger.
But the message, Bobbi, you can't be serious.
Exploitation?
You compare Spotify to an oil company.
I remember what you said at the start…
I remember your promise that everybody would benefit from Spotify.
Think about that.
-Daniel. -Yeah?
-It's done. -What's done?
I just spoke to the bank and they agreed. Another billion. You got the loan.
Okay…
What do we do about all this?
Do you think the bank cares about what a bunch of activists or senators think?
In all this chaos they heard only one thing: 45%.
You control the market. That's all they care about.
What do you think?
Maybe you're right.
I might have been in politics too long.
But listen… This is the last loan we can take out.
You have to figure out the business model.
If you can't do that, don't take the money.
Thanks.
Are you all right?
Did you see where Bobbi went?
You know what I regret the most with Spotify?
That I didn't leave the negotiations.
When we sat there in the first talks about the rights…
I should have said, "This is the future.
If you want to be a part of it, it has to be on our terms."
That would have been so damn beautiful.
So what you're saying is that everything will get better…
if you listen even less to other people?
Yes.
Okay, guys! That was the last shot for me and you too, guys!