Spotify + Amazon Fight Increased Royalty Payout for Songwriters
Earlier this year, the Copyright Royalty Board (CRB) confirmed a model for significant royalty increase for songwriters — nearly 44 percent — as a result of the Music Modernization Act. Now both Spotify and Amazon streaming services have filed an appeal in opposition.
The increased royalty payout was set to increase from 10.5 percent to 15.1 percent over the next five years, as reported by Music Business Worldwide when the ruling was made.
National Music Publishers Association President and CEO David Israelite stated the following (via Music Business Worldwide):
When the Music Modernization Act became law, there was hope it signaled 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 (CRB) spent two years reading thousands of pages of briefs and hearing from dozens of witnesses while both sides spent tens of millions of dollars on attorneys arguing over the worth of songs to the giant technology companies who run streaming services.
The CRB’s final determination gave songwriters only their second meaningful rate increase in 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 insincere and hollow public relations 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.
We thank Apple Music for accepting the CRB decision and continuing its practice of being a friend to songwriters. While Spotify and Amazon surely hope this will play out in a quiet appellate courtroom, every songwriter and every fan of music should stand up and take notice. We will fight with every available resource to protect the CRB’s decision.
Meanwhile, Google, Pandora and Spotify urged the Court of Appeals to look into the CRB's pay model.
"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 licensees and copyright owners. Accordingly, we are asking the U.S. Court of Appeals for the D.C. Circuit to review the decision," said the companies in a collective statement.
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