The Death of Spotify: Part II

Music is now tap water. You should be focused on selling Fiji.

A couple days ago, I published a piece quoting Jimmy Iovine’s claim that streaming services are “minutes away from being obsolete.”

The article went viral. My inbox caught fire. The comment section was impressive to say the least. It was a thing of beauty - reading through them was like reading a collective love letter to the history of music consumption.

People wrote viscerally about the emotional experience of physical media. They talked about the feeling of peeling the shrink wrap off a new vinyl, reading the liner notes cover to cover, hearing that initial crackle of the need dropping, and being locked into an album for 45 uninterrupted minutes. True, intentional, active listening. A dying art, but those people still exist. Goosebumps.

Then there were the purists - the people who proudly stated they never even joined the streaming wave. A bit pretentious, but I respect the hell out of it. They only listen to music they’ve downloaded or ripped themselves. Their libraries are meticulously curated, entirely intentional, and beautifully theirs. Nobody can take it away from them with a server update. True ownership of product.

And then there was the third group of commenters. This is the group I am addressing today.

They pushed back, semi-harshly about my original argument. They essentially boiled down to three main points:

1. “Jimmy Iovine is just an oldhead planting seeds to promote his own business.” Entirely possible, considering his recent ties to the acquisition of Complex, who is introducting new D2C infrastructure and is essentially the solution to the problems Jimmy introduced. His underlying math on the streaming margins, however, still doesn’t lie.

2. “Going back to buying physical media and direct-to-fan is an artist fantasy land.”

3. “Spotify isn’t going anywhere. Consumers love it”

Let’s address that last point. Because, quite frankly, those people are right.

I’ll admit it. I use Spotify every single day. I have over 300 playlists curated over the years. I use it to send music to my friends, and I even catch myself watching what my friends are listening to on the desktop app in the middle of the workday. What I want, when I want, how I want. My account syncs seamlessly from my laptop to my phone the second I walk away from my desk. It is an incredible piece of consumer technology.

Let’s be brutally honest. The mass market and the average consumer do not give a shit that Spotify is paying artists fractions of a penny. They don’t care that Daniel Ek is gatekeeping listener data, or that the platform actively prevents artists from building true communities. Consumers will always choose convenience over morality.

Spotify is not going to magically go bankrupt and disappear just because the music industry hates them.

But saying “Spotify isn’t going anywhere” is incredibly short-sighted. Do you remember 2004? We all thought Blockbuster was the absolute pinnacle of cinema access. Thirty years ago, nobody saw Uber taking over the taxi industry.

Spotify is not becoming obsolete because people will stop listening to it. It is becoming obsolete as a business model for artists. And more importantly, Spotify is currently shooting itself in the foot by refusing to adapt.

To understand why, you need to understand the difference between Tap Water and Fiji.

The Fiji Water Theory

As Jimmy Iovine pointed out, music on DSPs has been exponentially commodified. It is now a utility. It is indistinguishable from tap water.

Do we need tap water to carry on with our everyday lives? Yes. It’s cheap, it’s accessible, and it flows endlessly out of the faucet. That is Spotify. You turn it on when you’re doing the dishes, driving to work, or hitting the gym.

But will people still pay $9 for a bottle of Fiji water? Also yes.

Am I going to buy Fiji water every single day of my life? No. But when I’m out for a nice dinner, or on a vacation, or taking a road trip, I buy it. Because it gives me comfort, it makes me feel good, and it elevates the human experience. It is a premium, intentional choice.

The critics in my comment section completely misunderstood my point last week. Direct-to-fan isn't about ignoring the tap water. It’s about realizing you need to sell Fiji.

Because music has been commodified to zero, managers and artists can no longer survive selling tap water. We need to focus on selling Fiji water to superfans, while letting the tap water exist for the masses.

The Data: According to industry reports, superfans make up only about 15% of the general music-listening population, but they account for a massively disproportionate amount of music spending. If you are optimizing your career for the 85% who only want tap water, you will go bankrupt. You are leaving the real money on the table.

How Spotify is Bleeding Out (The Dumb Pipe)

Here is where the business model completely falls apart for Spotify, and why they are vulnerable to the next major tech disruption.

If we know that artists must sell Fiji water (high-margin merch, VIP experiences, vinyl, fan-club access, private listening parties) to survive, why is Spotify actively preventing them from selling it on their platform?

It is incredibly foolish of Spotify not to develop new pipes and paths to sell the premium water. Look at the platform right now. My questions to Spotify:

• Why are artists prevented from directly messaging their fans?

• Why aren’t artists able to access their own fan data (emails, phone numbers, geographic density of superfans)?

• Why is there no native social or community component?

• Why can’t artists sell goods directly and seamlessly on the platform? (And no, clunkily linking a Shopify account to the bottom of an artist profile so fans have to click away to a third-party site does not count).

Why does Spotify force artists to use Laylo for texting, Discord for community, and Patreon or Substack for subscriptions? Why do we need to build communities on other platforms?

By refusing to build these tools, Spotify is forcing the most valuable, high-margin interactions in the music business to happen completely off their servers.

Spotify wants to own the listener. They are terrified that if they give artists the data, the artists will leave. But by gatekeeping the data, they are turning themselves into a "dumb pipe." They are effectively saying: "We will handle the low-margin tap water, but we refuse to let you build a high-margin business here."

That is exactly how you invite disruption. That is how a new platform sneaks in, offers artists full data ownership, a built-in community interface, and the ability to sell Fiji water natively. Spotify is great for consumers, but until they allow creators to actually run a business on their platform, they will remain vulnerable.

That, is why Spotify becoming obsolete is entirely possible.

A lot of us think Spotify is holding us hostage because it has our libraries, our playlists, our personalities. I get that. But third-party apps are already allowing users to transfer things like playlists onto other DSPs (see SongShift, FreeYourMusic, or TuneMyMusic).

Even though it’s hard to wrap your head around, Spotify is not invincible.

The Fandom Funnel: How to Actually Sell Fiji Water

So, if Spotify is just the tap water, how do we actually build a business in 2026?

You build the Fandom Funnel.

The artists who are actually building sustainable, six-figure touring businesses right now aren’t boycotting Spotify. They are leveraging it to feed a three-step ecosystem.

Step 1: Discovery (The Tap Water)

• The Platforms: Spotify, Apple Music, TikTok, YouTube.

• The Goal: Reach and algorithmic discovery. You want casual listeners to hear you in the background.

• The Reality: If you don’t have an audience yet, this is where you start. But here is the massive secret the industry doesn’t want you to know: you don’t actually need the tap water to be the driving force forever. I know artists who have a “measly” 15,000 monthly listeners on Spotify, yet they sell out multi-hundred capacity rooms in multiple cities across the continent. Why? Because if you already have a core base, the algorithm doesn’t matter. You just need to master Steps 2 and 3.

Step 2: Capture (The Bridge)

• The Platforms: Laylo, Linktree, Mailing Lists, Website capture.

• The Goal: Moving them off the rented land. If someone streams your song three times, you need to offer them something in exchange for their Email or Phone Number. Make it frictionless. Open the front door to your house. You cannot sell Fiji water on Spotify, so you have to walk them across the bridge.

Step 3: Monetization (The Cultural Hangar)

• The Platforms: Bandcamp, Shopify, Patreon, Substack, Medallion FM, Laylo drops.

• The Goal: ARPF (Average Revenue Per Fan).

This is where the magic happens. Once they are in the Cultural Hangar, how are you keeping them there? What value are you providing to them?

It’s not just about asking them to buy a CD. It’s about exclusive access. It’s paid subscriptions. It’s hosting IRL listening parties in your hometown. It’s inviting your top 50 superfans to hang out at soundcheck before the doors open at a venue. It’s letting them hear the demo tape before it goes to the mixer.

1,000 passionate fans is a business model. If you don’t have those people yet, the tap water is important to find them. But if you already have that core, you can almost ignore the algorithm entirely. Just focus on Step 3, make getting into Step 2 completely frictionless, and build the house.

To the artists: stop worrying about whether Spotify is going to go bankrupt or change its payout structure. You cannot control Daniel Ek. You can only control your funnel.

Let them drink the tap water. But make sure you are in the business of selling Fiji.