Spotify Wins Process on the controversy of packages that have reduced payments to composers

Juiza presented the cause on Wednesday, months after Spotify was pursued to have reduced the royalties of the composers including audiobooks in their premium signature

THE Spotify Last year he was victorious in a cause against the company due to a controversial package strategy, which led to the reduction of the payments of the royalties to the composers.

A federal judge presented the action on Wednesday, who marked a significant victory for Spotify in his dispute with the music publication industry. The process began in 2023, when the platform introduced a new audiobook package in its premium signature. With this change, Spotify began to pay a lower royalties fee to the composers, claiming that the decision was in accordance with an agreement signed with musical publishers in 2022 through the Royalty Board of Copyright. The agreement allowed streaming services to pay less when they offered signatures that combined music with other products.

THE Collective of mechanical licenses (MLC), a non -profit organization responsible for the concession of mechanical licenses for streaming services, sued Spotify in May 2024, claiming that the platform ranked the package incorrectly and unilaterally reduced to rates up to 50%without any notice.

In the Memorandum presented on Wednesday, the Court concluded that Spotify was in its rights, stating that the rule of packages was “unequivocal”.

The only plausible application of the law supports Spotify’s position “, The judge wrote Torres analyzes. “On the basis of the facts presented, Audiolivros streaming is a product or service distinct from the musical flow and has more than a symbolic value. The premium service, therefore, is correctly classified as a package and the accusations of the action do not plausibly suggest the contrary. “

The dispute has become one of the most ferocious clashes in the music sector last year, with the defenders who criticize the practice to devalue the composers, who already have difficulty carrying out profits in the streaming era.

The MLC presented this action to contest the unprecedented measures of Spotify to significantly report less royalties to the MLC ” declared the organization in a declaration. “We are still concerned that Spotify’s actions are not aligned with legislation and that today’s decision does not comply with the central facts and legal principles of this case. We are analyzing the decision and evaluating all the options available, including our right to appeal. “

In response to Rolling stoneA spokesperson for Spotify celebrated the decision:

We are satisfied with this result, which shows that after a careful revision of the Court, the Spotify premium service has been correctly classified as a package and offers precious content together with the song.

The decision occurs a few days after Spotify closes a new agreement with the Universal musical group and its publication division, Umpg. At the beginning of the week, David IsraeliteCEO of National Association for Music PublishersHe ranked the new contract as “a clear sign that Spotify has heard the negative repercussion of his strategy of the package”.

Spotify mentioned this new agreement in his declaration on the presentation of the Wednesday trial:

“We know that the regulations can be complex, but there is space for collaboration”The company said.

This article is a translation by American Rolling Stone, written by Ethan Millman and published on January 29, 2025. Read the original version here.

Source: Terra

Earl

Earl Johnson is a music writer at Gossipify, known for his in-depth analysis and unique perspective on the industry. A graduate of USC with a degree in Music, he brings years of experience and passion to his writing. He covers the latest releases and trends, always on the lookout for the next big thing in music.