We at Indigenous Tunes are committed to empowering and educating our artists. We’re
writing to let you know about a major shift in the music streaming sector that may have
a big effect on your royalties. We want to make sure you know what this implies for you.
A recent court decision in the United States gave Spotify a legal victory over a case
brought by the Mechanical Licensing Collective (MLC).
The Court Case: Spotify’s Strategy for Bundling
Spotify recently unveiled a new Premium plan that is categorized as a “bundle” since it includes 15 hours of audiobook access in addition to music streaming. They were able to pay publishers and songwriters a reduced mechanical royalty rate as a result of this action. This was contested in court by the MLC, which advocates for music rights holders, who claimed that Spotify was underreporting royalties due to musicians.
Nonetheless, the court decided in Spotify’s favour, finding that its bundling approach complies with copyright regulations in the United States.
Your Royalties Are Affected by This:
1. Decreased Royalties
Spotify can keep paying a lower mechanical royalty rate for its packaged services because of the court’s ruling. As a result, artists in the industry may receive smaller royalties. According to projections, this decision may lower industry-wide payouts by about $150 million in the upcoming year. The per-stream payout can drop even though the streaming volume might remain constant.
2. Possibility of Upcoming Cuts
The decision allows Spotify and possibly other streaming services like Apple and Amazon to use similar bundling tactics, even though the company has said that overall payments to publishers and rights holders will rise in 2024. In the future, this might result in even fewer per-stream rewards.
3. Industry Reaction
To stop additional cuts in composer compensation, groups like the MLC and the National Music Publishers Association (NMPA) are already thinking about filing an appeal or advocating for legislative changes. The current structure is in place for the time being, although this could result in new discussions or changes to policy.
As an Indigenous Tunes Artist, What Are Your Options?
1. Expand Your Sources of Income
Even if streaming royalties are a significant source of revenue, depending only on them is dangerous, particularly considering recent developments. We advise you to investigate alternative sources of income. To diversify and augment your income, think about publishing partnerships, live performances, licensing agreements, and direct-to- fan sales. These sources of income can shield you from the unpredictability of streaming earnings.
2. Keep an eye on your royalties
Take the initiative to monitor your monthly income. Do not hesitate to contact us if you observe inconsistencies in your payouts. We are dedicated to making sure you receive the royalties you are due and to being transparent about your earnings. We’ll keep providing advice and assistance to help you deal with any shifts in the market.
3. Continue to Participate in Industry Conversations
The field of music royalties are always changing. It’s critical to keep up with changes in the industry and to back campaigns calling for a more equitable allocation of royalties. Staying up to date with these debates will guarantee that independent musicians like you have a say in these crucial issues and help mold the future of the music business.
The Promise of Indigenous Tunes to You
We at Indigenous Tunes are committed to ensuring that our artists receive just compensation for their labour. We’re keeping a careful eye on the situation with Spotify and other streaming services, and we’re looking at ways to support you during these transitions. If you have any questions about your royalties or any other issues, our staff is available to help.
As more information on this topic becomes available, we will keep you informed. We urge you to continue producing, developing, and expanding the possibilities of your art in the interim. As a community, we will continue to develop and prosper together.