Why Exactly Is Spotify Being Sued and What Does This Mean?

Spotify

On December 28th, 2015 long-time streaming foe, David Lowery, who runs the Trichordist blog and fronts the bands Camper Van Beethoven and Cracker, filed a class-action lawsuit seeking at least $150 million in damages against Spotify. The lawsuit alleges that Spotify knowingly, willingly and unlawfully reproduces and distributes compositions without obtaining mechanical licenses.

Ok, so those are the facts, but what does this mean?

Just for some basic background which will come in handy in a bit:

Labels represent artists. Artists record sound recordings.
Publishing Companies represent songwriters. Songwriters write compositions.

This is a very important distinction.

Every recording has two copyrights: one for the sound recording and one for the composition.  The only way Spotify (and all other streaming services like Apple Music, Rhapsody and Tidal) get music for their service is from distributors.  Every label, major or indie, works with distributors.  Every unsigned, self-released artist works with a digital distributor (like DistroKid, CD Baby and Tunecore) to get their music to streaming services.

+Want To Know Who The Best Digital Distribution Company Is?

These distributors get paid from Spotify royalties for the sound recording, NOT the composition.  Spotify (and all streaming services) worked out the sound recording rates they pay labels and artists (via the distributor) directly.  The compulsory royalty rates for compositions, however, are set by the US government.  Streaming services, however, don’t have to get permission to use a composition, but they do have to obtain a license for it.  A license can either be obtained directly from the publisher or they can send a Notice of Intent (NOI) to the publisher just saying that they intend to use the composition (30 days prior to releasing the song on the service).

If the streaming service doesn’t know who the publisher is, they could send an NOI to the Library of Congress as well.  But, from my understanding, no service actually goes that route.

But then, of course, the streaming services have to actually pay the mechanical royalties for the composition.  Mechanical royalty rates for downloads and sales is simply 9.1 cents per sale.

For streaming, however, the rates are much more complicated.  Harry Fox Agency (HFA) (who calculates this information for Spotify and Apple Music and pays out the publishers on behalf of Spotify and Apple Music) has these very helpful, albeit confusing, charts to calculate the streaming mechanical royalty rate per service.

Anyway, the lawsuit alleges that Spotify not only hasn’t paid all of the mechanical royalties, but that they didn’t obtain the proper licenses either.  Meaning, they didn’t negotiate directly with the publishing companies for the mechanical license nor did they send out NOIs either.

Jeff Price, founder and CEO of digital rights collections company, Audiam, has been dealing with these issues since they began collecting mechanical royalties two years ago.  He told me over the phone today:

“I have tried for years to have Spotify sit down with me to help with these problems.  I’ve sent them millions of lines of data.  I’ve shown them everything and they’ve done nothing.” – Jeff Price, CEO Audiam

Spotify’s global head of communications, Jonathan Prince stated, “We are committed to paying songwriters and publishers every penny.  Unfortunately, especially in the United States, the data necessary to confirm the appropriate rightsholders is often missing, wrong, or incomplete.  When rightsholders are not immediately clear, we set aside the royalties we owe until we are able to confirm their identities.  We are working closely with the National Music Publishers Association to find the best way to correctly pay the royalties we have set aside and we are investing in the resources and technical expertise to build a comprehensive publishing administration system to solve this problem for good.”

Price said that this is a “misleading statement” and is “not accurate.”  He said “you don’t need data to know if it’s licensed or not.”

This seems like a war of words and that Spotify is issuing some doublespeak, but let’s break it down what exactly this all means and what’s going on.

The music industry has been battling tech since as far back as Napster in 2000.  And, instead of working with tech to solve these problems, they have been fighting big tech, to what I assume, is hope that they’d just go away and we could all get back to the glory days of selling plastic discs for $18.99 again.  Completely ignoring progress and the consumer.

Believe me, as an artist and songwriter, I want to get paid all the royalties I’m owed from Spotify (and Apple Music). But I also understand the system, as it is today, is broken.

There aren’t clearly defined villains.  Spotify is not the villain.  They have just been a bit negligent.  Labels and Publishers, we all know, aren’t saints either.

When Spotify launched in the US in 2011, they tried to launch a streaming version of iTunes.  And they thought they could just get the same licenses iTunes had to get.  The problem, though, was with US Copyright law which hadn’t caught up with tech. Instead of waiting for the laws to catch up, Spotify got licenses from the labels for the sound recordings, but didn’t get all the licenses for the compositions.  Regardless if they know how or not, they didn’t.  Period.  And that’s illegal.

iTunes doesn’t need to send mechanical royalties directly to publishers because, in the US, the mechanical royalties are built into the sale.  iTunes sends all of the money for the sale AND the mechanical royalty to the label.  It’s the labels’ responsibility to pay the publishers the correct mechanical royalties.

But streaming is different. Streaming services (yes, Apple Music too) are required to pay publishers mechanical royalties directly.

Apple Music is most likely just as at fault as Spotify is.  Apple Music will probably get sued for the exact same infringement once they start making payments and publishers begin auditing their numbers.

On a personal note, I (like Mr. Lowery), represent my own publishing in the US.  I don’t have a publishing company.  So, technically, Apple Music and Spotify (and everyone else) should have sent me NOIs for my music.  My songs are registered with the US Copyright office and with ASCAP (with proper splits).  I receive NOIs regularly from Music Reports Inc. (HFA’s competitor), representing a myriad of companies, like Amazon, but I’ve never once received an NOI from HFA, Spotify or Apple Music.

So, Spotify and Apple Music are infringing.  Plain and simple.

But I sympathize with them, somewhat.

There is no global music database in existence.  There should be one master list which contains every song ever written and every recording ever released with all of the proper data: recording artist, label, distribution company, publishers, all songwriters with correct splits, every backup musician, producer(s), ISRC code, ISWC code, name and addresses of all rights holders, and so on.

This list doesn’t exist yet.  So, yes, it’s tough to track down all of this information.  But that’s no excuse.

Spotify (and Apple Music, Tidal and Rhapsody) should require all distributors to provide all metadata for every track they receive.

It’s not as tough for the distributor to require this information from artists and labels as it is for streaming services to track down this data for the millions of songs in their database.

If you search “All Along The Watchtower” on Spotify, hundreds of tracks appear. Only one is actually Bob Dylan, the artist, singing Bob Dylan, the songwriter’s, song.  So the hundreds of other releases, by Jimi Hendrix, Dave Matthews Band, Eddie Vedder, Neil Young, and so on, all earn Bob Dylan (the songwriter) a mechanical royalty.  But how does Spotify’s data system know that “All Along The Watchtower” by Bobby Womack is the Bob Dylan composition and not a song, by the same name, by a different songwriter?  Titles can’t be copyrighted.

 

Screen Shot 2015-12-30 at 2.30.05 PM

 

There are a bunch of songs titled “Butterfly,” but how would anyone know that the Jason Mraz “Butterfly” isn’t just a cover of Mariah Carey’s “Butterfly”?  Walter Afanasieff co-wrote the Mariah Carey version.  So every cover of their song earns Walter and Mariah a mechanical royalty.

 

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The only real way to distinguish (currently) is to actually listen to the song and determine if it is an original or a cover.

So, that’s why the streaming services should require distribution companies to provide this information.  It would solve all of these problems (for new releases).

But since there are millions of songs already on Spotify which have incomplete data, the industry needs to figure out a way to deal with this.

Sources have said that Spotify has put aside $17-25 million for pending and unmatched songs to pay publishers who come forward and request their mechanical royalties.

But, regardless, the law states today that streaming services must obtain mechanical licenses within 30 days of releasing the songs on their service.

And if it’s proven that Spotify has knowingly infringed, they could be on the hook for $150,000 PER INFRINGEMENT.  That’s per song that has been registered with the US Copyright Office.  That could be quite a bit of money.

If Lowery and company, win this class-action lawsuit for the asking $150 million, every songwriter who falls within this class (all those who haven’t received NOIs, given Spotify a direct license or been paid all of their mechanical royalties) will be entitled to an equal split of the $150 million – regardless if they’ve released one song for 0 streams or 100 songs for 100 million streams.

And it’s not just Spotify.  Apple Music and the rest better get their books in order and start to come up with a solution because they could be next.

Ari Herstand is a Los Angeles based singer/songwriter and the creator of the music biz advice blog Ari’s Take. Follow him on Twitter: @aristake

 

Photo is by Sorosh Tavakoli from Flickr and used with the creative commons license.

About The Author

Ari Herstand
Writer, Musician, Whiskey Drinker

Ari Herstand has been a DIY musician for over 10 years, has performed over 600 shows around the world and released 4 studio albums and 2 live albums. He has had songs featured on multiple TV shows, commercials and films and has shared the stage with Ben Folds, Cake, Matt Nathanson, Joshua Radin, Eric Hutchinson, Milk Carton Kids and Ron Pope. He created the music business advice blog, Ari’s Take in the Spring of 2012 to help DIY musicians navigate the independent world of music. Herstand was born and raised in the Midwest and got his start in the Minneapolis music scene. He rose to prominence locally and consistently sold out the 800 capacity Varsity Theater. He became the go-to musician in the scene for music business advice before he moved to Los Angeles in the Summer of 2010. Currently residing in West Hollywood, Herstand still spends a good portion of his time on the road touring. When at home he splits his time writing music, writing articles, writing his book (out November 2016 with Norton Publishing), playing shows at the Hotel Cafe and acting in TV shows (see him in his co-star appearances on Mad Men, 2 Broke Girls, The Fosters, Sam & Cat, Touch and others).

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57 Responses

  1. Kool-Aid Killer

    “Spotify is not the villain. They have just been a bit negligent.”

    Ari, when are you going to stop apologizing for these assholes? They care ZERO about your welfare as an artist yet you are constantly giving them praise and saying they’re the future. This company is Goldman Sachs, Sean Parker (ie, Napster heard of it), major labels (20 percent share) and…. Ari for crying out loud! They care nothing about whether you’re getting paid or not!

    I repeat: they DO NOT care about whether you or any other artists are getting paid correctly. Only if you SUE them do they care.

    They DO care about getting billions off this company.

    Reply
  2. Anonymous

    Ari, you are correct on almost everything you say above and I appreciate the detail. One thing I will add is that in the real world, wrongdoing of the type that Spotify is admittedly guilty, is rarely rectified through litigation, particularly when Spotify has been actively taking steps to rectify. Their ongoing negotiations with the NMPA on the issue have been by all accounts constructive.

    Spotify and other services had been lax about publishing because they thought they could be, no different than other industry leaders who cut corners to gain market share (Uber and AirBnB are good examples, moving into new markets faster than regulators could keep up with them). They need to be dealt with and songwriters need to be paid, but I can assure you of two things:

    1. They are not going away anytime soon
    2. Litigation is a dead end as the current negotiations will prove that settlement of the grievance can be achieved without clogging up the courts

    Reply
  3. Honk

    It’s neither correct not fair to label Lowery a “long-time streaming foe” when he has made so many statements to the contrary. His and most other musicians’ contention is not with the technology itself or its users, but with the lack of ethical business behavior in the models of certain streaming services, including their abysmal rates.

    Spotify is not artist-friendly. If it were, it would have addressed all of this before launch. It would have created a sustainable model for the musicians that are the core of their business. Instead they chased a valuation in the billions.

    Do you side with music-makers or the corporate entities that monetize their work? Until the latter do what is right, those are your choices. Until then, you can’t have it both ways.

    Reply
    • Roshambo72

      I’d be pretty surprised if Ari had ever heard of, or at least listened to, Camper Van Beethoven or Cracker before this lawsuit was filed. He can say all he wants to the contrary, but the fact that he discovered Adele via Target makes me think CVB is waaaaaaaay too underground for his worldview. Most likely he read a few articles and jumped to conclusions.

      Reply
      • ThomasH

        Because music taste is the deciding factor whether one understands the business of music. Solid reasoning there good sir.

        Reply
        • Roshambo72

          Lord no, I agree with you. I wasn’t critiquing the article as a whole – it’s actually pretty good, although I do agree that he’s being too easy on Spotify in general. My comment was in direct response to the comment before it – “Honk” questioned Ari’s assertion that David Lowery was a “long-time streaming foe.” My presumption is, Ari’s probably never listened to Camper Van Beethoven or Cracker before, and therefore doesn’t know that much about David Lowery and labeled him a long-time streaming foe without doing much research. I could be wrong, and if I am, that’s great, cuz both of those bands are awesome.

          And in fairness, on the grand scheme of things, it’s the least essential part of the article. It does paint David Lowery right from the start, but it doesn’t matter that much.

          Anyway, Happy New Year everyone!

          Reply
  4. Anonymous

    Your bad writing is so tiresome.

    Do you have any evidence that Apple Music is also guilty of infringement due to not paying mechanicals?

    Reply
    • Ari Herstand
      Ari Herstand

      I haven’t received an NOI from Apple Music (or received any mechanical royalties). So, for at least one artist, they are infringing. And my sources tell me that they have only done direct deals with publishing companies. So the thousands of artists who are self-released without a publishing entity (like David Lowery), never issued a mechanical license or are being paid mechanicals.

      Reply
      • Anonymous

        Apple Music hasn’t even been a service long enough for a royalties period to pass.

        BAD WRITING.

        Reply
        • Teddy

          The law states NOIs must be issued 30 days prior to a song going live on the service. If Lowery or Herstand haven’t received an NOI and it’s on the service for just two days it’s technically illegal.

          Not understanding why so many are against Spotify but cheer on Apple for the same negligence.

          Reply
        • Play Fair

          Better yet, let’s step away from the biased, uneducated rants and take a look at what this says about your understanding of the music business and the importance of honoring one’s own copyright to ensure that artists can be properly compensated.

          So much is wrong.

          In an industry all about demanding fair compensation, while at t4he same time decrying that it is that claims it’s “too difficult” and “too expensive” to provide efficient data about the music and those who make it, the mechanics of actually LICENSING and monetizing the precious works always ends up an afterthought.

          Whether it be simply registering with the Copyright Office or participating in collective licensing efforts, there is nothing that most independent musicians do to earn anyone’s respect or engender anyone’s help.

          Musicians get screwed largely because they ALLOW THEMSELVES to get screwed.

          Reply
  5. Santiago Sanmiguel

    Ari,
    Mechanical royalties wete created for reproduction publishing rights. Streaming is technically a public performance not a reproduction. The songwriter should be paid all the same, don’t get me wrong. But I’m not sure the ROI and other requirements apply equally as a mechanical reproduction.

    Great post!

    Reply
  6. Santiago Sanmiguel

    Ari,
    Mechanical royalties were created for reproduction publishing rights. Streaming is technically a public performance not a reproduction. The songwriter should be paid all the same, don’t get me wrong. But I’m not sure the ROI and other requirements apply equally as a mechanical reproduction.

    Great post!

    Reply
    • Ari Herstand
      Ari Herstand

      Actually, streaming earns both a public performance AND a mechanical royalty. The PROs collect and pay out the performance royalties and HFA is supposed to be calculating and paying out the mechanicals (but, clearly, they aren’t doing a thorough job of it). You can see how to calculate streaming mechanicals here.

      Reply
      • You Need to Be Precise

        It really bugs me when folks “reporting” on this stuff clearly do not understand it.

        “Streaming” does NOT bear both a public performance and a mechanical royalty to HFA and the PROs.

        To be clear:

        a) i) ALL “streaming” generates a public performance license for the SONG (as does radio airplay) -and ii) also for the SOUND RECORDING (which radio does NOT pay).

        b) NON-INTERACTIVE streaming DOES NOT generate any sort of “mechanical” for the song, at all (neither does radio airplay).

        c) INTERACTIVE STREAMING (i.e. “on-demand, like Spotify, where you can pick the songs) DOES generate a mechanical royalty for the song, along with the public performance royalty mentioned in a, above.

        Reply
        • Ari Herstand
          Ari Herstand

          Since we were solely discussing interactive streaming services, I am explaining the royalties for these services explicitly (like Spotify, Apple Music, Tidal interactive streams – not their radio services).

          Digital radio (non-interactive streaming) does pay performance royalties for the sound recording (via SoundExchange). Just not for terrestrial radio (FM/AM). Important to make that distinction between digital and terrestrial when discussing radio.

          Reply
        • Paul Resnikoff
          Paul Resnikoff

          Just taking a step back, I’ve always wondered how streaming could truly generate a mechanical, which was originally a license for physical reproduction. I think that’s part of the problem: old, antiquated licenses and royalties being shoved into modern-day formats that bear little-to-no resemblance to the past. It’s like the ringtone generating a performance right, or at least the arguments by PROs to make it that way.

          Reply
          • JTVDigital

            If my memories are correct, the reason it generates mechanicals is that most streaming services use the device cache memory for “pre-loading” the audio, to avoid too much play cuts / overall stream instability or decrease of quality and also avoid consuming too much bandwidth (that’s progressive download using local buffering vs. direct streaming)
            This temporary “storage” of the file on the device is considered as a physical (= mechanical) reproduction.
            This is extremely far-fetched and was basically a way for PROs / rights collecting agencies to tax something somewhere and try making money (for them and the writers and publishers they represent) from this “new” streaming thing.

          • You Need to Be Precise

            the fact that a guy who runs a site called “Digital Music News” says he’s “always wondered how streaming could truly generate a mechanical, which was originally a license for physical reproduction” is just too rich.

            Of course, a huge part of the problem is old, antiquated licenses and royalties being contorted to fit modern-day formats that bear little-to-no resemblance to the past. And of course, the gaps left in this imprecision is seen as an opportunity by every legacy organization – PRO’s tried to characterize every download and digital sale as a “performance” and HFA and publishers tried to claim that every stream is a “reproduction.”

            JTVDigital:

            The “reason” interactive streaming generates mechanicals is not that most streaming services use cache memory. If that were the case, non-interactive streaming and HD radio would have to pay mechanicals, as well, as they use the same technology to deliver smooth playback. There isn’t a technological difference between the way interactive and non-interactive radio is delivered. There is only a difference in the end-user experience.

            In addition, the argument that cacheing invokes a “reproduction” that must be licensed was (at least in large part) put down by the Cablevision case, which noted that simply cacheing a small portion of a work for the purposes of rendering it smoothly doesn’t rise to the level of “fixation [that is] is sufficiently permanent or stable to permit it to be perceived, reproduced, or otherwise communicated for a period of more than transitory duration.”

            The real reason is simply that digital services agreed with the music publishers to not have that technological argument. They agreed that fully on-demand services are, in some measure displacive of physical sales. If a consumer can ask for any song they want to be performed, then the consumer’s motivation to purchase a true physical reproduction is somewhat attenuated.

            Digital services agreed with this perspective, to the extent that publishers also greed that, for interactive services only, a mechanical would be paid, but it would be reduced by the amount of the public performance royalty also paid, on that on-demand performance.

          • JTVDigital

            Thanks for the additional info, these are some of the differences with US copyright regulations and our “droit d’auteur” here in France.
            Mechanical royalties are “generated” and paid for various types of distribution here, including web radios / non-interactive streaming services.

  7. Anonymous

    Ari, thanks for the explanation.

    Spotify establishing an escrow account (of sorts) for royalties owed suggests good-faith practices. If the database that oversees publishing licensing is impossible to sort through, as you’ve pointed out, it seems unlikely that a court would find Spotify liable especially if it’s an industry-wide problem and Spotify is willing to make restitution. Even if the case went to court would a jury of music consumers, and perhaps Spotify users, side with David Lowery’s group? I don’t think they would.

    Reply
    • Ari Herstand

      Right. I sympathize with Spotify on this. It is difficult to track down the tens of thousands of unmatched tracks. However, the law is on the side of Lowery et al. There are varying amounts of infringement. “Willful infringement” is $150,000 per song. “Innocent infringement” could reduce it down to $750 (or lower). But my sources tell me that there are tracks which they issued NOIs (meaning, they actually knew who to pay), but didn’t pay them all of their royalties. So, in that case, it seems that it is willful. But again, Spotify doesn’t have a system in place to be able to figure out cover versions. So, they may be paying some mechanicals to the proper publishing entities, but not all.

      It’s quite complicated. Again, it’s far from black and white.

      I think we need to come together as an industry and work WITH the tech industry to solve this problem. From what I hear, some entities (like Audiam) have tried to work with Spotify, and Spotify has refused, so maybe a lawsuit was the only way for them to actually put some effort into this.

      Reply
  8. Uncle Fester

    I did some theme music for a TV network startup, funded by VC guys, just like Spotify. I got paid for the tracks, but when I tried to collect royalties I was told that they never made an agreement with any PRO. A friend on the inside told me that their business model was to avoid paying until the societies came after them. By the time they had to pay something, it would never be the full amount owed. The backers of this venture were huge, rich as shit. This is how these guys operate. It’s exactly like Spotify. The way they roll is to NOT do the right thing, cause that is much less profitable! Ari you give them way too much credit…and you are the chump.

    Hope they lose this lawsuit and have to raise their prices, and are forced to get rid of their bullshit ad-supported tier. Oh wait… can’t do that cause it might hurt their big IPO. That’s all they really want.

    Reply
    • Ari Herstand
      Ari Herstand

      I feel like a chump sometimes. Thanks for that.

      I wouldn’t lump every tech entrepreneur together. That’s like saying because this metal band trashed my dressing room, I’m going to treat the folk duo like assholes when they come through because I had a bad experience with musicians one time.

      I believe streaming entities should pay every penny they owe, but I also understand how broken the system is and if Spotify entrusted Harry Fox Agency to handle all of the calculations and reporting, then HFA should be held somewhat responsible. It’s unfair to demonize Spotify when they tried to do what was right (hire an “expert” in the field). If you know of another company who can do it better than HFA, then by all means, let Spotify know (actually, Music Reports Inc may be the way to go after this…).

      Reply
    • Anonymous

      They like to call it “permissionless innovation”, which is really just a euphemism for “we figured out a new way to rip you off”.

      They’re greedy slime. Nothing more.

      Reply
      • Troglite

        I really don’t want to jump on the Ari-bashing bandwagon here, but I also feel compelled to speak my own truth.

        Complying with the law by sending NOI’s is NOT difficult. It only becomes difficult when your business plan depends upon making huge catalogs of songs available within a very short window of time. In other words, its the business plan of these streaming providers that creates a situation where complying with the law becomes difficult. They created the problem that they are now trying to use as a defense. The quality of the publishing data is a complete red herring in this context.

        The facts and bullshit can co-exist. Case in point, its true that assuming that every silicon valley start-up is intentionally breaking the law is unfair. But, that doesn’t mean that isn’t exactly what has happened.

        Put another way, what is easier to believe: that the scores of music industry experts hired by Spotify and Apple didn’t know that sending ROI’s was required or that Spotify thought they could get away with ignoring this aspect of the law and that setting the unpaidr royalties aside in a “lockbox” would provide sufficient legal protections if they get caught? Taken one step further, if you were preparing to launch a new streaming service like Apple Music and knew that Spotify had avoided the costs and delays associated with sending ROI’s would you put yourself at a competitive disadvantage by sending ROI’s?

        Reply
    • Sarah

      Now I guess I kinda feel like a chump, because I’m here with a streaming startup and we’re freaking killing ourselves sorting out licenses with the publishers and PROs prior to launching…. it never even occurred to us that just using people’s property without permission (statutory or otherwise) was an available option. Who knew? 😛

      Reply
  9. A-J Charron

    As so many others have mentionned, Spotify is not artist-friendly. And calling this negligence is a joke. They didn’t get the authorizations and still used the songs; that is not negligence. If they had wanted to play ball, they would have waited to get the proper licenses before using songs, but they didn’t care, they just wanted to have as much material as possible in order to make a buck on everybody else’s back.

    Why do you keep defending these guys??? As an artist, they are not working in your best interest.

    Also, that bit about the music industry fighting tech rather than working with it shows that you know absolutely nothing about the industry. Sure, the industry was fighting Napster who were ripping off the labels, the distributors, the artists, the producers… But they were also working on a solution (including signing new digital contracts with all artists, ie, making downloads legal) at the same time. At this moment, there are plenty of things happening that people are not aware of. It’s just that labels need to sign deals with their artists before they proceed whereas these techs just bully their way onto the scene without a complete disregard for everybody working in it.

    Reply
    • Anonymous

      It’s important for people to realize why Spotify chooses not to be an activist against piracy. By holding the threat of piracy over artists’ heads, they use that as leverage to pay out the lowest possible amount to creators. Piracy might be useful to them right now, but if Spotify ever wants to survive, make a profit, or have an IPO, they will have to come to the realization that pirate sites are hurting them as much as musicians.

      Reply
  10. JTVDigital

    Ari, great article as always, but please allow me to “correct” and comment a few things

    – “Every label, major or indie, works with distributors”: not exactly, major record labels are designing, building and managing their own digital supply chain systems, they don’t necessarily go through distributors.

    – “If the streaming service doesn’t know who the publisher is”: and there is no way for them to know who the publisher is. They just don’t receive this data from the entity supplying the content to them (since the publisher or writer info is not a mandatory metadata in most cases)

    So these guys want to make Spotify pay for issues created by others?
    Fine, they may succeed since judges are certainly not experts of these things and we have various big mouths all around spreading confusion on these topics.
    Just remember who is not (almost never) able to supply this information in the first instance.

    Reply
    • Yep

      This issue is an epidemic across the entire publishing world. If Spotify gets sued, then every single company who has any interest in any publishing rights could get sued.

      Ye see, the data is not accurate ANYWHERE! PRS, Apple, Spotify, SACEM, Universal, Peer Music….you are all guilty of having errors or omissions within the composer fields. No?

      Pointing the finger at one service is not healthy for the industry. I am sure they are doing their best to fix it.

      The only light at the end of this tunnel is at Google. The ‘Melody ID’ technology is one positive step away from relying human generated data, and into using fingerprints.

      This tech has some way to go, but one day it will correct these lost royalties.

      Reply
      • JTVDigital

        Agree. Data in music industry is “broken” at almost every step of chain. It starts with the recording studio assistant or label rep trainee not filling in the Label Copy properly, missing some not-so-important-for now info or making typos…but it would be too easy to blame the small guys, when (almost) nobody in these labels have a clue of what they are doing here and how “digital” works.
        All attemps made so far to fix the metadata miserably fail: costs too much, too long, too much data, it is unmanageable to do this in a manual way. And automations / scripts usually generate more issues.
        Suing some of the actors of this ecosystem won’t help at all since it will bring in more distraction, rather than letting companies, labels, publishers and PROs work on solutions to fix these issues (what they’ve always done but without much results).
        Having bad data is not fun for anyone, and even if there is a short-term financial interest to have holes everwhere in the databases (it allows to retain the money since you don’t know who to pay), this is not done on purpose. It would make everybody’s lives wayyy easier to have a chance to rely on accurate data and information.
        Content ID-like technology may be the solution, eventhoug it has some imperfections, but at least could help to progressively identify all the Works currently in the limbos.

        Reply
  11. Name2

    Labels represent artists. Artists record sound recordings.
    Publishing Companies represent songwriters. Songwriters write compositions.

    This is a very important distinction.

    And in many cases, utter bullshit. Labels don’t represent artists. This doesn’t even have to be argued in 2016.

    And Publishing companies’ relationships with works and songwriters are all over the map.

    There’s “Keep it simple”, and then there’s just lazy and stupid.

    I started my NY resolutions early and stopped reading right there.

    Reply
      • Name2

        You know, I originally crafted a careful, thought-out response, but it’s a new year, and you’re Anon, so fuck it. And in the future, do your own homework.

        I’ll just leave this here, because it’s easiest to understand: any label with an investment in a streaming company is putting its own interests ahead of the interests of its “artists”. Because it’s in the investors’ best interests to have 0 people stream 0 songs all month. All that sweet sweet profit floats like cream to the investors/labels. No dirty busking hippies have to get paid, no grabby/grubby publishers. Just a hot shot of cash right to the suits, the way God intended.

        Reply
        • Name2

          Actually, IIRC Spotify has not gone public, but several of the other streamers gave the labels a piece of the pie in exchange for taking a meeting. My bad.

          Reply
        • Anonymous

          You flunk.

          Here, I’ll even give you one: Victory Records.

          Now, there are hundreds of other successful record labels.

          Name another label that “doesn’t represent its artists”.

          Do it. Or are you completely full of sh*t?

          Reply
          • Name2

            Flunking out of music-biz school, but succeeding as a decent human being.

            Somehow, I’ll sleep at night.

  12. Erik Johansson

    The biggest costs for me is tracking down who I should pay money to, it can take tens of emails and months of looking to find out who should get the money. Anyone who has worked with music licensing must sympatize with Spotify on this. In the end it’s almost impossible to get licenses to stream/download music,

    But music is not my biz, so it might be all crystal clear to you guys. But for me this $150 million suit is clearly a statement that the music industry, small and big, has no intention in making it simple to actually sell music for anyone else than big industry like Apple/Sony/Spotify that can afford to fight cases like this.

    I’m not sure how to make my disdain of the music industry as a license seeker more clear.

    Reply
  13. FarePlay

    Let’s step away from the details and take a look at what this says about Spotify’s understanding of the music business and the importance they place on honoring copyright and compensating the artists who support their business.

    So much is wrong.

    In an industry that’s all about efficiently and inexpensively moving data around, music and those who make it, always end up an afterthought. Whether it be signing contracts to remove CDs from Starbucks or being the music service for Uber, there is nothing that this company does to earn my respect or want them to remain in business.

    Reply
    • Jane

      Yes FarePlay, you are correct. Nothing really to add. I agree with everything you’ve said.

      Reply
  14. Play Fair

    Better yet:

    Let’s step away from the uninformed attacks and take a look at what this says about your understanding of the music business and the importance copyright owners should place on honoring their own copyrights so that they can be compensated by the businesses who they rely on.

    So much is wrong.

    In an industry that’s all about claiming that they should be “fairly compensated” for their work, where one can efficiently and inexpensively provide data about what rights one has, to potential licensees, those who make music always treat licensing as an afterthought. Whether it be registering their copyrights or joining licensing collectives, there is nothing that most musicians do to earn respect or make people – especally politicians, the DOJ and businessmen – want to help them.

    Reply
  15. TripJ

    Ari, What does this mean for the artists who release a cover version. The artist gets licenses for Download and CD. But what about streaming? It seems from this article that the streaming service is responsible???

    When an artist tries to get a license for a cover in the streaming category, the cost is twice as much as what Spotify and apple music pays out per track. And the tracking of these streams through someone like Tunecore is very vague… Which tracks were skipped, skipped a few seconds in, or streaming completely?

    CD and Download licenses for cover songs seem pretty cut and dry…. but I just can’t wrap my head around the streaming.

    Reply
  16. Brian

    Spotify and Apple pay .0018 per play and groove music (Xbox music) pays .048 per play on average to me so who is a con-artist/ villain

    Reply

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