Spotify and Amazon “sue songwriters” after new row over royalties

The companies are appealing a ruling which effectively amount to "suing" songwriters

Spotify and Amazon are both embroiled in a new row with artists after the two companies launched an appeal against a recent ruling by the Copyright Royalty Board.

The ruling, which agreed to increase streaming royalty rates for artists by 44%, was challenged earlier this week by Spotify and Amazon, a move which The National Music Publishers Association (NMPA) has described as “shameful” and tantamount to “suing songwriters.”

As reported in Music Business Worldwide, the original ruling stated that on-demand subscription streaming would rise by 44% over the next five years. Whilst Spotify and Amazon have appealed the decision, Apple Music has not; Pandora and Google meanwhile, have asked the CRB to “review its decision”.

You can read some of the reaction to the news below:

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An official statement from the NMPA said that this “huge victory for songwriters is now in jeopardy”. Their President and CEO, David Israelite went on: “When the Music [Modernisation] Act became law, there was hope it signalled a new day of improved relations between digital music services and songwriters.

“That hope was snuffed out today when Spotify and Amazon decided to sue songwriters in a shameful attempt to cut their payments by nearly one-third…The Copyright Royalty Board’s (CRB’s) final determination gave songwriters only their second meaningful rate increase in over 110 years.

“Instead of accepting the CRB’s decision which still values songs less than their fair market value, Spotify and Amazon have declared war on the songwriting community by appealing that decision…No amount of insecure and hollow public relation gestures such as throwing parties or buying billboards of congratulations or naming songwriters ‘geniuses’ can hide the fact that these big tech bullies do not respect or value the songwriters who make their businesses possible.”

Spotify

He went on to thank Apple Music for not appealing the decision before adding that his organisation “will fight with every available resource to protect the CRB’s decision.”

In a joint statement, Google, Pandora and Spotify said: “The Copyright Royalty Board (CRB), in a split decision, recently issued the U.S. mechanical statutory rates in a manner that raises serious procedural and substantive concerns.

“If left to stand, the CRB’s decision harms both music licenses and copyright owners. Accordingly, we are asking the U.S. Court of Appeals for the D.C Circuit to review the decision.”

Last year, it was revealed that Taylor Swift signed a new contract with Universal Music Group, which also secured money for other musicians from Spotify.

Following months of industry speculation, Swift announced a multi-year record deal with Republic Records and Universal Music Group (UMG).

Some rumours had suggested the ten-time Grammy winner would be signing a direct distribution deal with music streaming giant Spotify. Instead, Swift successfully negotiated a deal that came with a unique condition –  that the sale of UMG’s shares of Spotify resulted in money to their artists.