Journalist Liz Pelly’s book is a scathing indictment of Spotify
In 1999, the music industry had a near-death experience that radically transformed how we create, share, and listen to music. That summer, two American boys, barely out of their teens, launched an app that allowed people to swap audio files with unprecedented speed and ease. Thanks to Napster, all kinds of songs—old, new, sometimes even barely released—were an Internet connection away. The idea seems quaint now. But back in the era of the scratchy dial-up, it was the first salvo in what many thought was the digital music revolution.
Napster had hundreds of thousands of users within months of its release; a year later, this number mushroomed to tens of millions. It happened to be the biggest—and perhaps the most commercially-minded—entity in a thriving online piracy scene full of anti-copyright activists, anarchist hackers, and precocious teenagers who were in it just “for the lulz.” Those of us who were young and green in the early 2000s—the golden age of Internet piracy—will remember a sense of awe at the sudden opening up of incredible new possibilities that permeated ‘The Scene.’
For many, this wasn’t just empty bluster to justify a song-stealing grift. In a newly-networked age, Internet piracy was part of a broader effort to challenge the hold of power and capital on knowledge. This spirit was embodied by earlier free software movements that sought to defy claims of proprietary ownership. There was giddy optimism about the Internet’s potential to unshackle the world’s art and culture from corporate enclosures of copyright and intellectual property. “Information wants to be free,” was the rallying cry of the day.
The cost of this unfettered access was borne by artists. Some were on board, the lopsided music economy had given them precious little to begin with. Others bristled at the latest blow to their sustenance. The biggest pushback came, expectedly, from a record industry aghast at the sudden crash of its record profits from the CD boom. A ricocheting series of lawsuits, lobbying efforts, and propagandist narratives followed.
By 2002, Napster had been sued into bankruptcy, but there were plenty of other services waiting to take its place. Debates about the ethics of piracy raged across the Internet and in courtrooms. Meanwhile, global record industry revenues reportedly dropped from $39 billion in 1999 to $17 billion in 2009. The music industry was on the brink of catastrophic collapse. Then, the myth goes, came help from unexpected quarters.
It is now popular lore that Spotify—which was launched in 2006, but really came into its own in the early 2010s—rode into the rescue. The Swedish company wasn’t the first to create a music streaming platform. But its offering was the most user-friendly, replete with the convenience and abundance that listeners had come to expect in a post-Napster world. This was a sanitised version of piracy, packaged without the moral conundrum, priced at an enticingly tiny fee or your attention for just a few advertisements.
Over time, Spotify and the model it championed found success and influence, although monetary gains were slower to come. In 2024, when the company reported its first profitable year, nearly half the $28.6 billion that the global music industry earned were accounted for by streaming, of which Spotify owned the largest share at about thirty percent. What’s more, the company claimed to have filled its coffers while reviving the moribund major labels, generating new distribution opportunities for independent musicians, and as founder Daniel Ek never tires of reciting, creating a: “level playing field” for artists. This plucky enterprise had, “saved music,” a 2018 Bloomberg op-ed gushed.
This is the story Spotify has lulled us into. But as the New York-based journalist Liz Pelly illustrates in Mood Machine: The Rise of Spotify and the Costs of the Perfect Playlist, it is a story based on half-truths. Pelly interviewed over 100 people for her book: former Spotify staffers, industry insiders, musicians, label employees, journalists, and researchers. She pored over internal company documents and communication, including Slack messages. She drew from her expertise as a music reporter who has closely followed the rise of Spotify, and as someone who strongly believes in the possibilities of collective, decentralised culture. “I’ve long been confounded by the expectation that we simply accept the dealings of the powerful as unexplainable,” Pelly writes early on in the book.
What emerges is a remarkable interrogation of the ways in which Spotify’s dominance has hollowed out the value of music and musicians. Pelly’s charges, conveyed in lucid prose and anchored by painstaking reportage, are precise. Spotify has increased existing inequities for independent artists. Its playlists often feature low-cost tracks by anonymous artists for hire masquerading as established musicians. The company has fostered a culture of passive listening by inundating its users with an endless stream of what Pelly refers to as inoffensive “platform-optimised pop.”
Suffice to say, Spotify has not saved music. In Pelly’s telling, it has accelerated the commodification of culture to create an asset class for the wealthy. In the name of creating a level playing field, the company has flattened diverse ecosystems into a consolidated winner-takes-all model that impoverishes everyone but major labels and their affiliate stars.
Why should any of this matter to listeners? Because we are left impoverished too, and not only because it is a system that makes us complicit in its injustices. It numbs discerning, differing, often deeply personal tastes to offer us cookie-cutter versions of our choices.
Pelly demystifies Spotify’s processes to find its promises of a “data-driven meritocracy” to be disingenuous. The story of the company, she writes, “is the story of the twenty-first century’s overeager and opportunistic tech solutionists, of billionaires and their overhyped machines, looking around for problems to solve, arrogantly disregarding the social problems left in their wake.” At stake, she notes, is “the very future of music.”
Institutional myths are debunked unsparingly under Pelly’s watchful eye. Take for instance the oft-repeated narrative that Ek and Martin Lorentzon, his investor and co-founder, came up with the idea of Spotify after months of meditation and soul-searching, looking to combat feelings of emptiness particular to the super-rich. “And we always came back to the music business,” Ek told one reporter. But music was not as inherently fundamental to the project as these claims suggest.
In fact, Pelly points out, Lorentzon himself once said during a conference that Spotify’s inception was hinged around revenue from advertisements. Under debate was the source of these advertisements. Ultimately, Lorentzon added, after considering movies and audiobooks, they “ended up with music.” This was partly because of the smaller file size, and partly because piracy was so endemic in Sweden that the industry—which considered the country a “lost market”—was more willing to consider a licensing deal there.
On the one hand, Ek and the company seemed to co-opt the anti-industry aesthetics of the piracy scene, with its product demo full of pirated mp3s from the team’s personal collections. Ek once told a gathering at Stanford University that he didn’t know he needed to license music from labels; at another gathering, Pelly notes, he wore a t-shirt that proclaimed “SUITS SUCK.” On the other hand, Ek was courting the suits, enlisting venture capitalists, and high-powered music industry consultants to help Spotify win over major labels. Depending on who was at the other end of the conversation, Pelly notes, the company either championed piracy or staunchly opposed it.
Spotify’s posturing—corporate altruism as a cover for profit-maximisation—is hardly surprising. But by identifying the company’s raison d'etre as advertising and not the furthering of culture, Pelly helps us make sense of its evolution. The product was always your attention, music was just the means to get it.
In 2012, a year after Spotify launched in the US, a study commissioned by the company suggested that most people often listened to music as the background score to other things they did. This heralded a strategic shift. The streaming service saw an opportunity in “people who wanted to lean back and let Spotify choose things,” a source close to the company told Pelly.
When your route to profitability depends on keeping people on the app for as long as possible—not introducing them to new, interesting, or challenging music—then that incentivises you to serve up the most anodyne tunes you can find.
Pelly’s book shows that this is exactly what Spotify did. In 2013, it bolstered these efforts with a team of in-house playlist editors who curated music by context and mood. The playlist, rather than the song or artist, became the streaming platform’s central commodity. Its purpose was not to entertain or enlighten but to be, as a former employee told Pelly, a “time filler for boredom.” You can see this in the preponderance of vibe-based chill playlists, full of smoothed-out, neo-muzak variations, and with sleep playlists in particular. As Ek once proudly declared, according to another former who spoke to Pelly, Spotify’s “only competitor is silence.”
This relentless focus on music as functional has pushed many artists to focus on making “streambait pop”—data-driven, algorithm-optimising pop that makes not standing out a virtue. Worse, it has trained a generation of listeners to treat music listening as an entirely passive experience—Pelly characterises this “dynamic of passivity” as the major cultural shift of the streaming era. For these listeners, music is no longer something you seek as a way of making sense of yourself and the world. Songs and albums are no longer embedded in the historical and cultural contexts from which they emerge. Instead, music just becomes a delivery mechanism for “vibes”.
If it’s vibes that listeners are looking for, then Spotify sees no reason to shell out money for real artists. Pelly documents how as part of a programme called Perfect Fit Content, which took off in 2017, the company commissions musicians through third party intermediaries to work-for-hire and create songs for its mood-based playlists, at very low royalty payments. Many of these tracks are then attributed to fake names with fake bios, sometimes even fake social media pages. Playlist editors were nudged into adding the songs to their curations. By 2023, Pelly found from internal Slack communication, about 100 official playlists were made almost entirely through such music.
Apart from duping consumers, this practice hurts the artists whose music had helped make those playlists popular, only to be replaced by derivative facsimiles. By some accounts, artists of colour suffer disproportionately. “Because what started happening was—spots for Black and brown artists making this music started getting cut down to make room for a few of these white Swedish guys in a studio,” a Spotify affiliate told Pelly.
Pelly portends a future in which this con will be automated. In recent years, Spotify has tied up with AI startups like Endel, which claim to use data to create “personalised functional soundscapes.” In 2023, Spotify banned another AI start-up because its artificially-generated tracks were revealed to have been streamed by artificial listeners. “Fake mood music streamed by fake listeners: Is that where the arc of recorded music industry ‘innovation’ eventually leads?" Pelly writes.
Then there’s Discovery Mode, the new-age heir to payola—a shorthand for the secretive bribes record producers in the US paid to radio stations for airplay in the sixties and seventies. Artists take as much as a thirty percent hit on their royalty payments for Spotify to be promoted by the app through its radio, autoplay feature, or playlists. Listeners are none the wiser about why they’re listening to the track. This is Spotify’s version of democratisation: an artist can either undermine their worth or risk obscurity if their peers, especially those with deeper pockets, are all signing up. Spotify aims to have between 30-50 percent of its recommendations “influenced by Discovery mode.” So much for a “data-driven meritocracy”.
Pelly’s book covers a litany of issues, familiar to anyone who has followed the music industry in recent years. The unfair and opaque royalty payouts system, the hoovering up and sale of massive amounts of consumer data, the transformation of artists into gig workers whose boss is the app. She is careful to point out that many of these problems are not unique to Spotify. The pre-streaming music industry was no utopia. What’s new is just how comprehensively Spotify has colonised all aspects of our musical lives.
Where do we go from here? “The problems created by venture capital are never going to be solved by more venture capital,” Pelly writes. Spotify isn’t the entirety of a historically exploitative system, just its latest symptom. The work to challenge it cannot involve quick-fix solutions. For systemic change, Pelly looks to community organisation, collective action, legislative lobbying, public archive projects, and universal basic incomes. But what Pelly is really arguing for is a revolution, picking up the threads of the heady 1990s and early 2000s—when a new, more egalitarian world seemed within our grasp until Silicon Valley tech bros betrayed that promise. "Ultimately, we can’t just think about changing music, or changing music technology,” she writes. “That’s not enough. We need to think about the world we want to live in, and where music fits into that vision."
