Spotify and Other Streaming Services Offer “Lowest Royalty Rates in History” for Songwriters

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You might want to sit down for this one, songwriters.

Owners of music streaming services, including Spotify, Apple, Amazon, Pandora, and Google, all filed documents with the US Copyright Royalty Board (CRB) this week telling them what they think they should pay authors. -composers for the five years between 2023 and 2027.

The Copyright Act requires copyright judges to conduct a process every five years to determine the mechanical royalty rates paid by streaming services to songwriters and publishers.

The current procedure, for the determination of the tariffs and the methods of creation and distribution of phonographic recordings (Phonorecords IV), also called CRB IV, aim to set the streaming royalties for songwriters for 2023-2027.

David Israelite, President and CEO of the National Music Publishers Association (NMPA), previously called CRB IV “the largest CRB trial we’ve ever had.”

Speaking to MBW ahead of the filings this week, Israelite explained that the lawsuit “has dire consequences for songwriters and music publishers.”

He added, “We will fight to dramatically increase what streaming services pay songwriters, and now we will see seamlessly how Spotify, Amazon, Apple, YouTube and Pandora are trying to reduce what little they do. are currently paying.

“Songwriters should all take note of what these giant tech companies have to offer – their submissions prove how much, or how much, they truly value the creators they rely on. “

The files and their contents have not yet been made public, but Israelite tells us today (October 14) that “Amazon, Spotify, Apple, Pandora and Google have offered the lowest royalty rates in history. “.

David Israelite, NMPA

“It’s disappointing, but not surprising, given the way they have treated songwriters over the years, including their continued assault on the rate victory that was achieved in 2018, which they still do. call four years later. “

David Israelite, NMPA

He added: “Not only are they proposing to roll back tariffs and conditions to wipe out all the gains over the past 15 years, but they are in fact proposing a structure worse than at any time in the history of the government. interactive streaming.

“It’s disappointing, but not surprising, given the way they have treated songwriters over the years, including their continued assault on the rate victory that was achieved in 2018, which they still do. appeal four years later.

“The next time you see a billboard, paid advertisement, or token gesture from a streaming service claiming to value songwriters, remember their actions speak louder than any hollow gesture. . This fight has just started.

MBW understands that NMPA, on behalf of music publishers and their songwriters, has come up with a broader four-part formula, including:

  • 20% of turnover; Where
  • 40% of what record companies and artists receive; Where
  • $ 1.50 per subscriber; Where
  • $ 0.0015 per game

Today’s news takes place against the backdrop of the ongoing CRB III legal battle between songwriters, their publishers and certain music streaming services in the United States.

To recap, in January 2018, songwriters in the United States scored a major victory when the US Copyright Royalty Board (CRB) ruled that royalty rates for streaming and other mechanical uses would drop to 44% on the market over the five years between 2018 and 2022..

The decision called for a significant increase in the overall percentage of revenue paid to songwriters from 10.5% to 15.1% over the five years between 2018 and 2022, which would mark the largest rate increase in the history of the songwriters. CRB.

This decision was ratified in February 2019, when the CRB published the final rates and conditions for songwriters.

The following month (March 2019), Spotify, Google, Amazon and Pandora (but not Apple) opposed the decision, which NMPA likened to “suing songwriters.”

Spotify’s move has been criticized by prominent music industry figures and superstar songwriters, while aThe songwriters’ advocacy group Songwriters of North America (SONA), co-founded by songwriters Kay Hanley, Michelle Lewis and lawyer Dina LaPolt, immediately condemned the move.

“There are many fronts to the war for higher and fairer tariffs, but we hope that the entire music industry will unite to support our efforts in these pivotal cases as they will dictate the future. of the streaming economy. “

David Israelite, NMPA

Speaking to MBW ahead of the rate filings for CRB IV this week, NMPA President and CEO David Israelite said: “It is extremely disappointing that we are fighting for higher rates in this lawsuit. , while simultaneously pushing back the call of the latter the increase we won for music creators in CRB III, which is currently being led by some of the world’s largest companies.

“There are many fronts to the war for higher and fairer tariffs, but we hope that the entire music industry will unite to support our efforts in these pivotal cases as they will dictate the future. of the streaming economy. “Music trade around the world

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