@FeaturedArtist’s Lucie Caswell calls for “due reward” to artists from Spotify equity windfalls

[And what about the songwriters?]

As the trading floor eyes up Spotify’s float, the attention of the music industry is on its licensors. None more so than music makers, who created the assets which make Spotify and its rivals, the billion-dollar businesses they are today. In theory, those assets are due for a windfall as option agreements become exercisable and paper value crystallises into cash. This is potentially a moment which proves the extraordinary opportunities of our digital age, the borderless, boundless bounty of music, the leadership of music innovation and, the enormous value in this business we love, music.

Whose value and how much however, is the conversation of the day. Spotify floating as the New York Stock Exchange takes a hit, is hopefully not prescient of the rewards to the music value chain, through rights-owners and rights licensors who included equity in their licensing deals. Premium-priced initial sales would suggest otherwise. Those licensing deals intrinsically exist for the protection and monetisation of copyright – the music rights and songs artists entrusted to those licensors, for the best advantage to achieve fans and revenues. Rights-holders, distributors, aggregators and services like Spotify, all make money from that transaction and, that trust. Surely it is only sound business that the trust will be repaid and the creators receive due reward from those valuable assets, when money is made.  Whether marketing them, streaming them, building a business upon and around them or licensing them, this industry is sustained and sustainable only, with those songs and recordings.

How much value, will be a matter of the deal at hand and the hour at which the licensor cashes in (something which it seems, will be a tightrope dance of timing over the initial roller-coaster period of trading). From that point, the licensor must decide how to distribute the win across all of the assets it has licensed. Notice I say all. There is apparently some discussion of who should be included, of what repertoire may or may not feel the windfall and who is more valuable.

At this stage we point, as we have before, to the demonstrative WIN FairDigitalDeals Declaration. This landmark calling-card for fair play by rights-holders has come of age. Principle statements are now to become practice. This simple document, signed up to by a growing, global swathe of independent labels, is indicative of how good practice is the fair, transparent and creator-led business we strive for as the FAC.  Good players are many but they also provide precedent that business can be done with equal revenue shares, clear reporting and by fit for purpose, full and fair distribution of wealth to those who create it. Now is the time for all labels and licensors to really demonstrate good intent for artists, ensuring that our ecosystem is sustainable in practice and principled throughout.

Read the post in Music Week

Spotify Is Deeply Integrated With Facebook: How Safe is Your Streaming Data? — The Trichordist

Spotify is stalking you (advertising campaign image by Spotify) The public has woken up to the fact that Facebook is a spying and privacy violating machine. Governments in half a dozen countries have announced some sort of investigation into the company. What most people don’t realize is that Facebook is not unique. Virtually every […]

via Spotify Is Deeply Integrated With Facebook: How Safe is Your Streaming Data? — The Trichordist

Barf. Just Barf. — The Trichordist

[Editor Charlie sez:  The Music Modernization Act really is the Spotify IPO Preservation Act, as we suspected!]

David Israelite of the NMPA and Mitch Glazier of the RIAA have penned an op-ed for Variety Magazine, in which they extoll the virtues of various copyright reform proposals before congress. While I agree with them about the Classics Act (fixes pre-1972 loophole) AMP act (helps producers/engineers receive royalties from digital royalty streams) every day […]

via Barf. Just Barf. — The Trichordist

@andreworlowski: Spotify wants to go public but can’t find Ed Sheeran (to pay him)

Nor Drake. Nor Bruno Mars. You’d think they weren’t trying very hard

Spotify has ended five years of speculation about an IPO, and has filed for a public share offering likely to make its founders – and large record labels – extremely rich indeed.

But although that giant payday is built on the back of songwriters’ “sweat and precog”*, Spotify still has trouble finding them to pay them. Even when they’re as world famous as Ed Sheeran…

For more than a year, music services have been exploiting a loophole in US copyright law. Instead of sending a cheque for mechanical royalties, they’ve been filing a statutory “notice of intention” to pay them instead. The NOI is a piece of paper which isn’t redeemable for cash. (The curious can peruse the most recent NOI filings – and Spotify is not alone in filing them! – with the Licensing Division of the US Copyright Office here**).

Millions of NOIs have now been filed. How come?

Amazingly, the law does not oblige the user of the music, Spotify, to do a diligent search on who wrote it. Nor does the law oblige them to maintain and use their own records. So you can be sure that Spotify knows exactly how to find Ed Sheeran to pay him his performanceroyalty. However, in a display of insolence that Kevin The Stroppy Teenager (pictured) would envy, it manages not to find Ed Sheeran to pay him his mechanical royalty. Ed who?

Read the post on The Register

@andreworlowski: The Great Bulgarian Streaming Scam may well have been scummy, but Spotify got paid

An unknown Bulgarian has become the talk of the music industry after a sophisticated and apparently successful attempt to game Spotify.

Thanks to a fascinating exposé by Tim Ingham at Music Business Worldwide we learn that the perpetrator may actually have been playing by the rules, bringing to light a little-noticed characteristic of the streaming model.

The scammer, who has not been identified, uploaded more than 400 sub-one-minute tracks to Spotify and arranged them into a playlist, Ingham reports. Many were a little over 30 seconds, the minimum length of listening time that Spotify requires to pay out a royalty payment. These were then streamed continuously to some 1,200 paid Premium accounts….

Spotify has paid $5bn to rights holders over a decade, and streaming accounts for half of UK music consumption, according to the BPI’s annual fact sandwich. But Spotify’s payouts to creators went down even as its revenue increased last year, according to this report. Spotify maintains overall payments increased. How much hard-earned cash are subterranean robo royalty schemes extracting?

Read the post on The Register

@musicbizworld: THE GREAT BIG SPOTIFY SCAM: DID A BULGARIAN PLAYLISTER SWINDLE THEIR WAY TO A FORTUNE ON STREAMING SERVICE?

[Tim Ingham tells a story of a Spotify royalty scam run by a “Bulgarian playlister” (…stop right there and go no further…who was running what are obviously scam playlists of snippets by manipulating Spotify subscription accounts.  As Tim notes, the fact that the “Bulgarian playlister” was able to manipulate a large number of “paying” subscription accounts, raises yet more important questions about Spotify’s subscriber numbers.  This is obviously of vital importance to potential buyers of Spotify’s stock–what subscriber numbers are real.  Perhaps the Securities and Exchange Commission will question the man behind the curtain.]

A Bulgarian playlist-maker scammed the Spotify payout system for months last year – and could well have made themselves a millionaire off Daniel Ek’s platform.

That’s the shock claim being made by multiple high-level industry sources to MBW this week.

Music Business Worldwide can today reveal details of the alleged shakedown, which reached its height at the end of last summer.

The evidence we’ve gathered strongly suggests that one party sucked a vast amount of money – as much as $1 million-plus – out of the Spotify royalty pool, and away from legitimate artists and labels.

And the best/worst part of all? They probably didn’t break any laws in the process….

Spotify tells us it’s now “improving methods of detection and removal”. But the big question remains: are the scammers out there improving their methods too?

Are there others, like our Bulgarian friend, purchasing multiple premium Spotify accounts and rinsing playlists stuffed with cheap music to which they own the rights?

If so, how many of these Spotify scammers exist – and how much money are they generating?

Are they operating at a lower commercial level than The Bulgarian and, therefore, not outing themselves by appearing on weekly top global playlist charts?

Crucially: what does all of this mean for the solidity of valuations for music’s biggest companies?

And even more crucially… what does it mean for the veracity of Spotify’s paying audience as the company begins its high-stakes escalation towards the New York Stock Exchange?

Read the post on Music Business Worldwide

 

@artistrightsnow: Content Creators Coalition: Spotify’s Wall Street Cash Out Leaves Artists Behind

PRESS RELEASE

Washington, D.C. – The Content Creators Coalition (c3) released the following statement on Spotify’s plan to go public on the New York Stock Exchange:

“Spotify’s founders had an opportunity to pioneer new models and partner with artists on ways to make the music ecosystem work for everyone – services, artists, and fans.  Instead, they cashed in – enriching company owners and deep pocketed investors and doing nothing for working artists who continue to chase pennies online.  This IPO chooses a short term payday over long term progress and will only weaken the streaming ecosystem, burdening the art of music with Wall Street’s bottom line first mentality and erecting new barriers between creators and their fans.

“Spotify’s algorithms and curated playlists have already failed artists and songwriters, making haphazard and emotionally stunted connections between supposedly ‘related’ acts and pushing costly advertising tools as the best way to reach new fans.  The result is the worst of all worlds – at one end artists and independent rights holders have no meaningful input into how their work is presented and promoted on the service and at the other end, they are paid grossly substandard wages for the airplay they do receive.  And it will get worse as Spotify’s managers focus more and more on shareholders and less and less on music.

“Artists stand ready to embrace streaming models that work for all.  But we will always reject corporate greed and ‘too big to fail’ models that squeeze the soul out of our work and distances us from our fans.”

About c3:

The Content Creators Coalition (c3) is an artist-run non-profit advocacy group representing creators in the digital landscape. C3’s work is significant to anyone who creates and makes a living from their creations. c3’s objectives are two-fold: First, economic justice for musicians and music creators in the digital domain. Second, ensuring that the current and future generations of creators retain the rights needed to create and benefit from the use of their work and efforts. C3 has grown into a national organization based on representation, advocacy, and mobilization for sustainable careers in the digital age.