This is pretty much the default answer to all such questions, unless directly proven to be otherwise.

The last thing they would want is for Spotify, or anyone else, to effectively become a record label in their own right.

Plenty of companies will mass upload your music to all of the streaming sites for like $20-30/year which sounds pretty cheap compared to the old days of needing a record label to do anything other than play in bars. Those companies aren't considered record labels, they are distributors which is almost what Spotify is doing. Some of those distributors offer engineering and marketing services too but it still doesn't make them record labels. There are so many record labels out there that there really isn't an issue with another smaller one popping up.

I'm sure they're fine with the small fish. But with Spotify, Apple, and others who might have the financial muscles to become a threat if given the chance? I'm not so sure.

I worked at Spotify and I am very close with several folks there who worked on this initiative. This is almost certainly the fault of the labels.

Could you elaborate a bit? Do you think it's because of copyright issues, or because labels don't want Spotify to become a popular distributor that publishes exclusively to itself?

I doubt copyright issues had an impact here. There is always a much larger perspective the labels have over the industry than what we can talk about here.

Ultimately, it is about control. Every decision from the ads you hear to the choice of music you get in your Discover Weekly playlists (or any made by Spotify) come from the influence of label control over the company (and industry). Songs that appear or can be heard near or in sequence of each other to an end user are not really that random.

We as consumers forget that the entirety of Spotify is a heavily curated experience. This includes the features available to us on various devices which directly impact how and what (pod casts) we can listen to and when (free tier on mobile)

It's unfortunate that the influence is becoming more and more apparent. Stories like this make me wonder what's to become of Spotify in the future. https://www.billboard.com/articles/business/8517869/when-you...

I've always thought Spotify could be the Steam of music: To bring artists and listeners together, but I now believe Bandcamps done more in that regard and Spotify might end up being a data harvesting tool for the labels.