So I have never even opened Swift’s page on Spotify — let alone played a song (if there are fans here, please don’t come after me). I pay for Spotify. So did you mean to say the largest portion of my monthly fee goes to Taylor Swift?
If you listen to more music than the average listener, those artists get paid out more than what you put in, and if you listen to less, they get less. But on average it all levels out anyway.
Unless people who listen to a particular artist on average stream less music entirely. Which doesn’t seem to be the case.
If you listened to less music than the average person then some of your fee went to the people who listened to more music, and the other way round if you listened to more music. Which is going to average out in the end anyway, while massively simplifying the accounting. Spotify can also tell artists exactly how much they are getting paid rather than having to wait for the end of the billing period to work it out. Only to come to roughly the same amount anyway.
There is no tracing routes with a pooled fund. Only inputs and outputs. And the outputs would seem to be pretty much identical in the pooled system vs individual pools per user.
If payed by total listens Taylor gets 99%.
Now if those 99 listens are from the one user and the other from the other user. Paying by listens ratio per user, Taylor will get 50%.
Over the entire population of Spotify listeners you are going to have high and low listen count users that average out.
1. Put all money in a big pot and pay out depending on all streams.
2. Put your money in a pot and pay out depending on your streams. Do the same for all users.
The total sum of money stays the same. If your audience listens to more music than the average Spotifier then you will get paid less using method 2.
All in all the difference isn’t massive.