How Spotify Pays (Or Fails To Pay) Songwriters

Here longtime copyright attorney Stephen Carlisleattempts to get to the bottom of Spotify's failure tocontact or pay his client, despite the prominence of said client's music on the popular streaming service.

Two months ago, the Wall Street Journal ran an article reporting that Spotify had failed to pay a significant amount of royalties due to the music publishing company associated with Victory Records. 1 Rather than make nice with Victory Records’ publishing arm, Spotify responded by pulling Victory’s catalog off the music streaming service.

This was immediately followed by several articles by David Lowery, (a songwriter for the indie bands Cracker and Camper Van Beethoven) on his website, The Trichordist. There, he stated that Spotify was playing more than 150 songs of his without permission or payment and published an open letter to the Attorney General of the State of New York calling for an investigation.

Spotify responded to these reports in the Wall Street Journal piece by stating:

““We want to pay every penny, but we need to know who to pay,” Spotify spokesman Jonathan Prince said in an email. “The industry needs to come together and develop an approach to publishing rights based on transparency and accountability.”

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Could it be possible that Spotify was streaming these songs without ever contacting us or paying the client?

I called up my son, who has Spotify, and asked him if this musician was available on Spotify.

“Yeah,” he said. “They’ve got a whole page of him.”

I asked him to take a screen shot and email it to me.

I opened up the screen shot and looked at it in disbelief. There, listed amongst his other songs, was a song owned by my clients that had 642,558 streams. To make matters worse, the song had only the one writer, and so was owned 100% by my clients. Therefore, the possibility that a co-writer’s publishing company had issued a license did not exist. A quick email to the client publisher’s accountant confirmed my suspicions.

Spotify had not paid a penny in royalties.

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This is where the whole “we don’t know who the songwriters are or where to find them argument” falls flat. Every record company has a department that does nothing but license the musical compositions which appear on their recordings. They know who the songwriters are, what the percentage splits of the copyright are, and most importantly, where to send the royalty payments.

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And certainly, Spotify knows who the musician is. His name and picture appear on the Spotify listing. Spotify took the time to set up a page and post a picture to attract listeners but couldn’t take the time to properly license the songs?

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That’s not the way it works, and has never been the way it works. You don’t use someone’s copyright until you have the right to do so. Licensing is your responsibility, Spotify. If you don’t have a license, don’t stream it. It’s really that simple. Don’t get into the music business if you have no clue how the music business works. Record companies have full-time licensing departments. Why don’t you?

Plus, there are, right now, huge searchable databases of musical compositions, their composers and their respective publishers. They are run by ASCAP, BMI and SESAC. The problem is that the U.S. Department of Justice enforces consent decrees that legally prevent ASCAP and BMI from issuing the very kind of licenses Spotify wants. The Registrar of Copyrights has proposed removing those restrictions. That might be a good first step.

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#Streaming #Spotify