Spotify could be going public in the next year, and it’s apparently hoping to rejig its deals with major music companies before then.
The music streaming company is now negotiating with record labels, looking to shave some percentage points off what it pays them, reports the Wall Street Journal. The publication adds that Spotify is said to pay 55 percent of its revenue to the big three labels,Universal, Sony and Warner.
For comparison, Apple gives 58 percent of its Apple Music revenue to the labels, according to Music Business Worldwide. That publication notes that Spotify is out of any long-term contract with the three companies, operating on month-to-month contracts with each of them during the negotiations.
Spotify has been criticised by some for underpaying artists. Taylor Swift had her music taken off the streaming service in protest, and other artists, like Britney Spears and Frank Ocean, give their new albums timed exclusivity to Apple Music. Similarly, Beyonce’s Lemonade album is exclusive to Tidal, the music streaming service owned by her husband, Jay-Z.
Looks like record labels may be on their way out soon!