Spotify has paid for the catalogs of the major record labels by giving out a lot of their stock. AFAIK, there never was a whole lot of cash involved.
From the record labels' point of view, Spotify is excellent. Artists tend to have contracts where their paycheck is related to the number of records sold and times their songs are played in the radio. Some countries even have laws to protect the artists in this. However, there is no mention of online streaming, so artists don't really have to be compensated for that.
When you pay for or listen to ads in Spotify, you're mostly giving the money to the record labels and pretty much nothing to the artist. That money is going to spent for lobbying for laws that will life-support the deprecated business model of the record companies. Of course this is a bit exaggerated but in my eyes paying for Spotify is kinda like supporting SOPA.
