Spotify and Napster see mass exodus of record labels
Dance music distribution, manufacture and management company ST Holdings has withdrawn all of the content it looks after from Spotify, Napster, Simfy and Rdio. Out of the 238 labels it distributes, only four requested that they remain on the streaming services.
The company believes that these subscription platforms cannibalise the revenues of more traditional digital services, and cites both its own recent turnover coupled with a report published by the NPD Group and NARM. It finds that more "access" to content reduces a consumer's need or passion to buy that content outright in what is termed "discrete purchasing" - using online retailers, such as iTunes. And this was standard across all demographics, from die-hard music fans to casual listeners.
Clearly also, the revenue opportunities offered through streaming services cannot make up for loss of earnings through poor sales. Especially for specialist record labels.
ST Holdings, therefore, has made such a drastic decision to remove (almost) all of its managed labels from the services: "As a distributor we have to do what is best for our labels," it says in a release statement. "The majority of which do not want their music on such services because of the poor revenues and the detrimental affect on sales. Add to that, the feeling that their music loses it’s specialness by its exploitation as a low value/free commodity."
Of the labels, which includes Hyperdub, home of 2008 Mercury Music Award nominee Burial (with his album Untrue), one even stated, "Let’s keep the music special, fuck Spotify."
All bar four of them have now been removed.