Like others in this thread, I naively assumed this was how Spotify already worked, and wondered why the payouts tended to be so low. Now it makes sense, and puts the numbers here ( http://www.spotifyartists.com/spotify-explained/ ) in context. Realistically, it would be both hard to change structurally and a hard sell for major labels to give up what is effectively a subsidy of popular music by indie fans. Let’s take…
But there's an impedance mismatch here. The copyright holders are being paid per-play but the users are paying all-you-can-eat. That's always going to be an imbalance. The only way to "fix" that would be to charge "Terry" a cent per listen like a jukebox. This is a bit like being a vegetarian at a buffet and complaining about your admission fee paying for steak which all those other people are eating. It's true, but…
This scheme is similar to the proposal to calculate artist pay independently for each user, but I think it's a little simpler, since you still only calculate the artist pay out of the global pot, you're just weighing each play by the user's total monthly plays. And you can put a minimum on it too, so the per-play weighting doesn't take effect until the user listens to more than a given number of tracks per month (this way the user who has a subscription but just occasionally listens to a song here and there isn't paying the artist $1 per play, which is to say, until you reach a certain point, listening to other songs won't "devalue" your previous tracks).