The current Spotify controversy prompted by a podcaster highlights the many land mines that riddle the new digital media landscape where consumers have multitudes of options, according to University of Miami music industry and business law experts.
Serona Elton, director of the music industry program and associate dean of administration at the Frost School of Music, noted the proliferation of news outlets and social media sites that have shifted the power paradigm for digital media platforms like Spotify.
“Platforms are trying to grow the diversity of content they offer,” Elton said. “More varied content inevitably leads to a greater risk that some of it will be considered offensive to users of the platform and other content creators. From time to time, platforms will find themselves having to pick sides. That is what is happening in this case.”
Elton, who has worked with three different major record label groups for more than two decades, noted the long history of instances and ways that artists have spoken out or taken action to serve commentary on occurrences in the broader culture.
“This is another noteworthy and important example,” she said. “And like many companies before them which have faced public criticism, Spotify has to weigh both the impact from a public relations perspective and the impact, if any, on their bottom line. As a publicly traded company, it also has a duty to its stockholders.”
The current controversy with the leading music streaming service sparked when Joe Rogan, who signed a $100 million contract in 2020 with Spotify for exclusive rights to the “Joe Rogan Experience,” broadcasted perceived inaccurate and misleading information regarding the COVID-19 virus on his podcast. Rogan is the headline act of Spotify’s podcast division, a centerpiece for its new business strategy.
Celebrity musicians Neil Young, Joni Mitchell, and others took offense at what they consider misinformation broadcast on the same platform that generates considerable revenues from their music. The artists deemed the alleged misinformation a threat to young listeners around the world “who think everything they hear on Spotify is true.”
In protest, they persuaded their record labels to direct Spotify to remove their recordings from the platform. Other popular podcasters on the platform—including Brené Brown, Prince Harry, and Meghan Markle—joined a growing list of personalities who also registered their concern.
In reaction, Spotify announced it would begin placing advisories on COVID-19 content that recommended connecting with its health and science channel. In addition, Rogan recently said he will strive to be more balanced in coverage of controversial topics.
“Spotify has to be running the numbers as part of their analysis. When they decided to pay $100 million for the Rogan podcast rights, they had to have calculated how much their subscription and advertising revenue would increase from carrying the exclusive content,” Elton explained, who emphasized that the terms of that contract are unknown and therefore it is unclear if Spotify could terminate the contract even if they wanted to.
“Spotify will now have to also calculate the revenue they might lose from subscribers and advertisers leaving the platform because of the Rogan podcast,” she said, adding that the potential impact of the artists’ protest is still to be determined.
From a legal standpoint, censorship is not an issue in this controversy, according to Ann Olazábal, a business law professor in the Miami Herbert Business School.
“Free speech and its flipside, censorship, emanate from the Bill of Rights and serve to constrain the government—not what private actors like Spotify can or can’t do,” Olazábal said. “Put otherwise, Spotify’s right to suppress or edit Rogan’s podcasts is not limited by the First Amendment.”
That right, if any, is delineated by the parties’ written agreement, she acknowledged, adding that Spotify’s public statements have indicated that the only limits the contract places on Rogan’s podcast is to comply with Spotify’s general content policy, applicable to all its content providers.
“Evidently that policy is fairly flexible, and even then, Spotify probably retains the legal right to waive Rogan’s duty to comply with it,” Olazábal noted. “We have seen other internet platforms bend their rules for high profile content users, that is not unlawful. Free speech is simply not at issue here, at least from a legal perspective.”
Nor does the controversy implicate Section 230 of the Communications Decency Act (CDA), the legislation enacted in 1996 that allows internet platforms like Spotify to post content without having to moderate or police it for harmful effects, according to the business law professor.
“While medical and scientific experts have warned that vaccine or COVID-19 misinformation generally creates public distrust, Rogan’s podcast does not yet appear to have created a specific harm to a specific person who would have legal standing to sue Spotify over it,” Olazábal stated. “If there were, and Spotify were sued, the company could avoid liability by pointing to Section 230. Although some might want to leverage this moment to press for amendment of the CDA to reduce blanket immunity for internet platforms, as the matter stands, the statute just doesn’t apply to this controversy.”
Elton said that the controversy highlights issues of rights management with respect to who has the authority to direct a platform to remove content, a topic she has shared with students in her music industry contracts class.
She explained that recording artists signed to record labels do not have the right to control the distribution of their recordings. “The financial investment made by a record label in the production and marketing of recordings usually buys them the decision-making authority over how to monetize the content in order to make back their investment.”
Does the influence of artists and consumer reaction and response exercise more muscle today when a controversy such as this surfaces?
“When artists and celebrities throw their weight behind a cause, it can make a difference and influence business decisions,” Elton said.
“Today, social media and the vastly increased number of media outlets have given artists much more influence over public opinion than they ever had,” she added. “And public opinion can go a long way to influence a record label or digital platform, even where an artist doesn’t have contractual control.”
On Friday, a compilation video of Rogan using the n-word in podcasts over the past decade was posted on social media platforms. Rogan responded Saturday in a post that the instances were taken out of context and that he hasn’t used the word for years.
Dozens of Rogan’s podcasts have been removed from the Spotify platform in recent days. Spotify CEO Daniel Ek issued a statement this weekend to Spotify staff saying “how deeply sorry I am for how The Joe Rogan Experience controversy continues to impact each of you” and that Rogan’s comments do not represent the company’s values. He reiterated, however, that Spotify has no plans to remove the podcast.
