Spotify Could be Liable for ‘Tens of Millions’ In Unpaid Songwriter Royalties…

tip_of_iceberg

 

This could be the beginning of a very serious showdown between Spotify, independent labels, publishers, and songwriters, with potentially tens of millions — or more — at stake.  “Victory might be the beginning of something here, [Spotify] might actually owe tens of millions on mechanicals,” one music industry told DMN over the phone last night.

“Guaranteed, Spotify’s lawyers are looking at this very, very carefully.”

Earlier this week, Spotify actively pulled the entire Victory Records catalog following a disagreement over a specific type of songwriter royalty.  Victory, aided by data from royalty-focused startup Audiam, presented data to Spotify alleging under- or non-payment on roughly 53 million song plays, leading to the impasse and total content yank-down.

“After two years I find no evidence that [Spotify has] properly licensed most of the songs that are currently available on the service.”

Now, a very vocal David Lowery — frontman of both Cracker and Camper van Beethoven and a leading artist activist — is accusing the streaming platform of similar subterfuge on 150 different songs.  “I guarantee you that the Victory Records problem is just the tip of the iceberg,” Lowery posted on his site, The Trichordist.

“For the past two years I’ve been trying to figure out how it is that Spotify has legally made available many of the songs that I have published under Camper Van Beethoven Music and Bicycle Spaniard Music. In order to make my songs available on their service in the US, Spotify must enter into a direct license with my companies or an assigned agent.

 

 

“OR they must serve an NOI (notice of intent) to take advantage of the statutory compulsory license.”

 

“After two years I find no evidence that they have properly licensed most of the songs that are currently available on the service. This is the equivalent of a record label releasing an artist’s music without having a contract with the artist (to be fair Apple owned Beats Music may have this same problem as well.)”

 

iraqi

 

Meanwhile, Spotify head of PR Jonathan Prince claims that Spotify simply doesn’t know who to pay, though comments like those could haunt Spotify if this ends up in litigation.  “We want to pay every [fraction of a] penny, but we need to know who to pay,” Prince said.  “The industry needs to come together and develop an approach to publishing rights based on transparency and accountability.”

Meanwhile, Audiam founder Jeff Price is promising to rattle an extremely contentious cage.  Price, co-founder of Tunecore, is now on a warpath to claim and recover royalties from tech giants like YouTube and Apple.

 

More as this situation develops.  Written while listening to Quantic. 

Image by davidkn1, licensed under Creative Commons Attribution 2.0 Generic (CC by 2.0).

25 Responses

    • Spotify does NOT pay labels Publishing Money...

      Please people get educated. Spotify does NOT pay labels any publishing money, not one cent.

      Neither does Pandora. Streaming Services are responsible for paying publishers and songwriters DIRECTLY.

      There’s not one cent of money paid by Spotify for record labels for Songwriters.

      For more than a decade Itunes has paid labels, and labels have paid artists, publishers and songwriters – and you know what? It worked for the most part. The problem now can be explained like this : If apple suddenly started only charging 10 cents per album and 1 cent per song could artists and songwriters survive on that kind of revenue reduction? Probably not, but hey welcome to streaming…

      Reply
        • UGH... Spotify only pays labels master royalties NOT publishing.

          please go take a college course somewhere and get educated. spotify only pays labels master royalties, spotify does NOT pay labels one cent for publishers or songwriters… so where’s that money going? hmmmmmm…

          Reply
      • Yep

        Streaming laws dictate that master side is what generates the most money, which is why writers often see very little money… MASTER SIDE is usually owned by the label, hence yes Spotify does in fact pay the label. Get your story straight OP!!

        Reply
        • You Are Wrong - Spotify Does NOT Pay Labels the Songwriters Money

          You are wrong, Spotify does NOT pay labels any publishing or writers money. FACT.

          Learn a little.

          Reply
          • dcguzman

            You should go to pandora and spotify royalty page and be educated fool! Streaming services pays royalties to the government in form of ASCAP and soundexchange or whatever… While they also pay advances with the labels for the right to stream the songs. If you want anyone to blame, blame the copyright law and dont believe Paul. Pandoira is a 10 year old company. Do you think in all of these years they will go out soon?

  1. PublishingGiuy

    The NMPA is already negotiating settlement with the DSP’s for unpaid publishing royalties and are sing so without making a big public show of it. This is not breaking news to anyone in the biz. Also, this could have been settled without both parties (Victory and Spotify) suffering. Victory is now losing our on sound recording plays because of this action, and Spotify has to suffer the bad press.

    The idea that Spotify would rather pull down these recordings AND not pay for the publishing royalties owed simply does not smell right. There’s more to the story here that we’re not being told.

    Reply
    • spotify

      your last line…

      The idea that Spotify would rather pull down these recordings AND not pay for the publishing royalties owed simply does not smell right. There’s more to the story here that we’re not being told.

      what if there IS something shady going on. like victory doing fraudulent plays with bots or something. then it would make sense as to why the catalog was pulled. spotify wouldn’t want that infomation public because it would lead to thousands of copy cat attempts (like sleepify).

      Reply
      • PublishingGuy

        I think perhaps Audiam is the problem. Why would spotify not pay a publisher they could already identify as being owed?? They even tried a direct deal with Victory but they couldn’t do it because they were with Audiam. Spotify chose to take down the recordings, costing Victory a lot more money than they would earn through the publishing payment, perhaps as an aggressive response to the way they were being dealt with by Audiam. Just a theory.

        Reply
  2. Anonymous

    “After two years I find no evidence that they have properly licensed most of the songs that are currently available on the service”

    Ouch!

    Reply
  3. Journalism police

    This is insane. Paul, you first take your own bias view and put it into an actual quote when mentioning fractions of a penny (that’s called libel), then you publish smut using unnamed sources. One source you deemed “one music industry” ….industry what? I know you re-read your own work pridefully, maybe do it with some attention to detail for once. That or hire someone who can actually polish your turds. maybe they can do some research for you as well. And the photos of a dictator? Are you kidding me? Yes, paying royalty rates set by our own court is the same as lining up children and shooting them against a brick wall. Get over yourself.

    Reply
    • Johnny C

      Maybe the ” Journalism Police”should do a little research of their own before making a statement, picture of a dictator,?
      That’s Baghdad Bob ,press liaison for Iraqi army under Saddam Hussein ,Hell I’m just your average American and even I knew that . I guess the “Jounalism Police” need to fine themselves for “cluelessness”

      Reply
  4. Ari Herstand
    Ari Herstand

    The issue is with Harry Fox Agency. Spotify uses them to calculate and distribute all mechanical (songwriter) royalties. To vilify Spotify for not paying out all royalties is misguided. HFA are the ones who aren’t doing their due diligence. Their one and only job is to figure out mechanical royalties. If they can’t do this properly, then why is Spotify paying them so much to do it?

    The issue is when songs have the same name. Take “Youth” for instance. How does Spotify know that Taryn Southern’s song “Youth” is a cover of the Foxes and not an original? How do they know that Matisyahu’s “Youth” is an original? How do they know it’s not the “Youth” by Daughter or Ben Kahn? How do they know Sydney Carter’s “Youth” is actually by Daughter and not an original of hers?

    The data is completely f’d. But, it’s HFA’s responsibility (at least right now) to fix this. But it’s an impossible task with the way it’s all setup currently. There is no master database of music where Sydney Carter’s “Youth” would trace back to Daughter, back to the writers Igor Haefeli and Elena Tonra. There are so many broken strains of data to get Haefeli and Tonra paid for Sydney Carter’s “Youth” Spotify plays.

    There are literally thousands of other cases like this. No master database = lots of money not paid out.

    This is not a black and white issue. There are not “good” and “bad” guys here. There’s a lack of data and no real solution present today.

    Reply
    • GGG

      Sorry, you’re a DMN writer. You’re not allowed to talk about Spotify payouts in any way that undermines the idea that Ek just drives past bands’ houses in a solid gold car and throws a handful of change onto their lawn, maniacally laughing the whole time. There’s absolutely nobody else involved in that transaction.

      Reply
  5. Steven

    At least in my case steaming is the artists best chance of getting my $s. They need to find a way to make steaming work. Streaming has got to be in the interest of lesser known artists. The days of me spending $10-$20 per CD to decide if I may like an album or artist are LONG gone.

    Reply
  6. Joseph Nicoletti -Global Village music co.

    it is and was Spots, responsibility to Take care of Business, they had NO Problem with keeping the money, they could care less who they owe the money to, a Very Expensive so called mistake LEARNED,..

    Reply
  7. Jim

    Every Artist should have a web site and sell direct to the consumer. Cut out the middle men. Put a clip of your tunes on the page for people to preview. Up date the page with new content frequently so fans keep coming back. If music really is your livelihood, it’s work. It’s not all about writing and recording the tunes. You need an entertainment lawyer more than an agent or record label. Get a good one first before you consider anyone else.

    Reply
  8. dcguzman

    ‘This could be the beginning of a very serious showdown between Spotify, independent labels, publishers, and songwriters, with potentially tens of millions — or more — at stake. “Victory might be the beginning of something here, [Spotify] might actually owe tens of millions on mechanicals,” one music industry told DMN over the phone last night.’

    ” one music industry told DMN over the phone last night.’

    Nice wordplay there Paul. Please post so called news if I ever seen real streaming armageddon here, rather than post fear mongering articles. Just a fact BTW unless the independent labels are popular and viewed millions of streams like Adele label, streaming services just dont care. No one cares for indie labels. Please Paul post some sensible news! We’re still waiting for shut down of streaming services that you blabbering since last 2 years.

    Reply
  9. Mozie

    Just to clarify – Spotify DOES pay publishing ‘direct’ to the writer.
    I’m a member of PRS in the UK and I get payment for every play!
    Trouble is the amount I’m paid via streaming is very low – and that is where the issue lies.
    e.g. I had a TV show that was streamed adding up to a total of 1.5 million minutes of music being streamed.
    This generated about £165 for me.
    If broadcast TV goes down the tubes then we will be left with micro budgets for film and tv composers and that will degrade the quality of music in TV/FILM.
    And quality in other areas – classical / jazz / folk / (and anything on the fringes)
    Moz

    Reply
  10. Anonymous

    “Well, we don’t know who to pay so we’re just not gonna pay anyone.”?!!! What knid of defense is that. Someone sue these bastards.

    Reply

Leave a Reply

Your email address will not be published.

Verify Your Humanity *