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February 3, 2022updated 04 Feb 2022 8:58am

Spotify share price falls amid misinformation controversy

By MarketLine

Spotify, the world’s largest music streaming provider, has faced significant criticism due to its lack of action over misinformation surrounding COVID-19. The company’s shares fell 18% in the wake of the incident(s) before recovering to record a smaller loss in value.

Music stalwarts have removed catalogues over misinformation

Music icons, Neil Young and Joni Mitchell have removed their music catalogues from Spotify libraries to protest the platform’s inaction over misinformation. In a statement posted to his website, Young called the streaming giant, “the home of life-threatening Covid misinformation”. He also revealed that 60% of his streaming revenue came from Spotify. Joni Mitchell said in a post on her website, “Irresponsible people are spreading lies that are costing people their lives.”

It is thought that surviving polio in the 1950s not long before a vaccine became available influenced the decision of both musicians. The removal of the catalogues was prompted by the claims made on the ‘Joe Rogan Experience’ podcast. Assertions made on the podcast, which Spotify purchased the rights for in a deal totaling $100m, include the claim that vaccines are a form of ‘gene therapy’ which alter a patient’s DNA. Another claim was that young people are at greater risk from the vaccine than from COVID.

The backlash has instigated action from Spotify and Rogan

Since facing backlash for these claims, Joe Rogan has pledged to offer more balanced views on his podcast. Spotify, in response to criticism over its lack of anti-misinformation policies, has since introduced a new guideline for labelling content that includes discussion over COVID-19 and the option to remove or suspend users and podcasts that promote falsehoods. CEO Daniel Ek also pledged those new warnings will direct users to a coronavirus fact page.

Critics claim the action has come late and only as a response to extensive media coverage and that the platform should have acted in conjunction with policies enacted by YouTube, Twitter, and Facebook. However, Spotify claim monitoring and labelling audio content is not as easy as flagging images or text posts. Furthermore, Spotify claim to be the first podcast platform to introduce anti-misinformation protocols.

Spotify have downgraded forecasts

After the company’s shares fell during in-hours trading, the company revealed it had missed initial expectations that the streaming platform would reach 183 million paying subscribers in the quarter. However, Spotify claim missing the target was due to uncertainty related to the pandemic and not linked in any way to the removal of music catalogues and the misinformation controversy.