In March 2016, the popular music streaming service, Spotify, reached a settlement with the National Music Publishers Association (“NMPA”) to cover billions of unlicensed streams from member publishers dating back to the service’s U.S. launch in 2011. Spotify will pay $25 million to publishers and songwriters and $5 million in punitive damages—a sum many are calling an easy break for the billion dollar streaming service. Those who had their mechanical license rights infringed had until June 30, 2016, to opt-in to a settlement agreement between the NMPA and Spotify. The NMPA negotiated the settlement with Spotify on behalf of its members.The pros and cons of opting-in have been hotly debated as class action lawsuits, such as those brought by singer David Lowery and singer-songwriter Melissa Ferrick, have been filed.
YouTube Music Pass, the new Google-owned music service, has indicated that it intends to block content from independent labels that have not signed up for its subscription music service from its current free service. YouTube Music Pass is a new streaming service that will allow people to download music to their mobile devices and watch and listen to music videos without ads, even when not online. On June 17th, YouTube’s head of content and business operations, Robert Kyncl, confirmed that independent artists could disappear from YouTube if their labels do not sign up for the new service.
Spotify has launched a new commission-free service that permits music artists to make their merchandise and live concert tickets available to fans through the Spotify platform. Through Spotify’s partnership with direct-to-consumer marketing platform, Topspin Media, artists will now be able to link from their Spotify artist page to a webstore, enabling them to provide fans direct access to CDs, vinyl records, t-shirts, posters, stickers, writstbands, and other merchandise through Spotify. Participating artists will manage “preview” merchandise images, item titles, and descriptions that will be linked to the applicable webstore. Spotify will moderate submissions to ensure the authenticity of offered merchandise. It is anticipated that the merchandise offerings will appear on an artist’s page 24 to 48 hours after submission by the artist. Currently, the service limits artists to offering a maximum of three merchandise items at a time.
The Sports, Arts & Entertainment group at Foster Garvey provides full service legal representation on sports, entertainment and business matters, including handling transactions related to brand management, licensing, joint ventures, venture capital, private equity, technology, the Internet and new media.