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Music publishers, like Downtown Music Publishing, Big Deal Music, Reservoir, and Ultra Music, are suing luxury exercise brand Peloton for copyright infringement on more than 1,000 musical works, valued up to around $150 million. David Israelite, CEO and President of the National Music Publishers’ Association, which represents some of the publishers filing suit, responded by saying, “It is frankly unimaginable that a company of this size and sophistication would think it could exploit music in this way without the proper licenses for this long, and we look forward to getting music creators what they deserve.”

Tech companies Apple and Spotify are also in dispute over the App Store, with Spotify claiming Apple charges excessive fees, blocks upgrades, and unfairly promotes its own streaming service. After Spotify filed an anti-competition complaint with the European Commission, Apple responded back by saying the music streamer had cloaked its “financial motivations in misleading rhetoric about who we are, what we’ve built and what we do to support independent developers, musicians, songwriters and creators of all stripes.” Spotify hit back, calling Apple a “monopolist” and its response “entirely in line with our expectations.”

YouTube is making a few changes in manual claiming: The first will include an update that will prevent content owners from filing a manual claim if they already have a Content ID claim pending on the same video. The second will require content owners to provide timestamps, so that videos can be marked exactly where their copyrighted content is located. The feature is set to launch in the next few months and is intended to reduce the time that creators spend on the dispute queue based on creator feedback.

Now, the details...
Compiled by Heidi Seo

Exploration Weekly - March 22, 2019

Music Publishers File $150 Million Copyright Infringement Lawsuit Against Luxury Exercise Brand Peloton

Music publishers, including National Music Publishers’ Association (NMPA) members Downtown Music Publishing and Ultra Music, are suing luxury exercise brand Peloton for infringing more than 1,000 musical works in a $150 million copyright infringement lawsuit. Peloton is known for their thousands of music-driven videos that include music recorded by artists like Rihanna and Bruno Mars. A subscription service is also offered with over 13,000 workouts, and Peloton has recently been valued at $4 billion. NMPA CEO and President David Israelite stated, “Music is a core part of the Peloton business model and is responsible for much of the brand’s swift success...Unfortunately, instead of recognizing the integral role of songwriters to its company, Peloton has built its business by using their work without their permission or fair compensation for years...It is frankly unimaginable that a company of this size and sophistication would think it could exploit music in this way without the proper licenses for this long, and we look forward to getting music creators what they deserve.”

Spotify and Apple Participate in Ongoing Battle over App Store Flap

Spotify and Apple are continuing to battle each other over the App Store. Spotify complains that Apple charges excessive fees, routinely blocks Spotify upgrades, and unfairly promotes its own streaming service in its App Store. As a result, Daniel Ek announced in a blog post that the company lodged an anti-competition complaint with the European Commission regarding the conflict. Apple responded back, taking a swipe at Spotify’s unified appeal with Amazon, Google, and SiriusXM/Pandora against the US Copyright Royalty Board’s decision to raise rates for songwriters, “At the same time, they distribute the music you love while making ever-smaller contributions to the artists, musicians and songwriters who create it — even going so far as to take these creators to court.” Spotify hit back at Apple’s response saying, “Every monopolist will suggest they have done nothing wrong and will argue that they have the best interests of competitors and consumers at heart. In that way, Apple’s response to our complaint before the European Commission is not new and is entirely in line with our expectations.”

YouTube to Require Content Owners to Provide Timestamps When Copyright Claiming a Video

YouTube’s manual copyright claiming tool is going through a few changes. The platform will soon roll out an update that will prevent content owners from filing a manual claim if they already have a Content ID claim pending on the same video. A Help Center post about the changes reported that YouTube is implementing the rule about multiple claims because claims should be made using the “best existing asset, reflecting all relevant co-ownership and policy information.” In addition, YouTube will require content owners to provide timestamps indicating exactly where their copyrighted content is located in creators’ videos. The company posted, “This change is intended, in part, to address feedback that you’d [referring to content owners] like to spend less time managing your dispute queue.” When a video is claimed via Content ID, the YouTuber will see exactly what is being claimed in the video and where. YouTube has noticed a pattern of YouTubers filing unnecessary disputes simply because those creators can’t locate where in the video copyrighted content exists.

Tencent Music Stock Drops Following First Post-IPO Earnings Report

Chinese music streaming service Tencent Music Entertainment (TME) published its full year and Q4 earnings for 2018 - its first earnings report since its IPO on the New York Stock Exchange on December 12. TME shares dipped below $17 on Wednesday March 20, falling over 7% in overnight trading. Its total revenues, on the other hand,  increased by 50.5% year over year to RMB 5.4 billion ($785 million) in the three months ended December 31, 2018. A net loss of RMB 876 million ($127 million), however, was posted. The streaming service has also reported 644 million online music mobile MAUs (monthly active users), up 6.8% from the same time in 2017. From the total MAUs, the number of users paying for TME’s online music services increased by 39.2% to 27 million. In the full year ended December 31, 2018, TME’s total revenues increased by 72.9% to RMB 18.99 billion ($2.76 billion) with a net profit of RMB 1.83 billion ($2.67 million). Reuters has reported in the past that TME owner, Tencent, is mulling an acquisition bid for Universal Music Group.

Spotify Plans “Songwriter Town Hall Meetings” in LA and Nashville

Just weeks ago, Spotify finally launched in India amidst a legal battle against Warner Music Group (WMG). And then more recently, Spotify promptly appealed a Copyright Royalty Board (CRB) decision to increase songwriter royalty rates by 44%. The company explained that it hadn’t “sued” songwriters, as the NMPA had alleged, but few people bought the reasoning, unfortunately. As such, Spotify is reportedly holding a series of public town hall meetings for songwriters in both Los Angeles and Nashville. An email by Mark Beaven, founder and Co-CEO of Advanced Alternative Media (AAM), shared with Billboard that songwriters should be warned against attending. If they do attend, he stated, songwriters should urge the company to allow NMPA President and CEO David Israelite to speak on their behalf. Spotify has not issued a comment as of yet on the report and Beaven’s email warning. Beaven promptly revised the letter for the public a few days later on Variety.

Report: YouTube Generates 40% of Indian Labels’ Digital Revenue

New estimates for the Indian music industry in 2018 were published in a report by business association the Federation of Indian Chambers of Commerce and Industry (FICCI) this week. Recorded music revenues in India grew by 10% to ₹14.2 billion (around $207 million) in 2018, and it is predicted that it will grow to reach ₹19.2 billion (around $280 million) by 2021. In addition, 83% of labels’ revenues in India is accounted for by digital. And YouTube accounts for 40% of those digital revenues. According to the FICCI report, around one million to 1.5 million people in India paid to stream music in 2018, generating around ₹800 million ($11.7 million). MusicPlus, which reported the FICCI publication, suggested, “The music segment needs to be creative in channeling consumers towards a paid subscription model. If the current base of 1% of Indian music pay subscriber, can shift upwards to 2-3%, digital revenues can propel the necessary growth to push the Indian music market towards ₹20 billion and beyond.”

Streaming in France Surpasses Physical For First Time Ever

French music industry body SNEP released its annual report this week, showing a 1.8% bump in overall revenue across recorded music in France, totalling €735 million ($834 million) in its third consecutive year of growth. Digital revenue exceeded physical sales for the first time ever, totaling 57% of global sales, up 23.2% in paid streaming revenue, while CD sales dropped by 20.6%. Subscription revenue was the number one source of revenue inside the digital segment. Paid streaming alone accounted for 41% of music sales, compared to 8% five years ago. Ad-supported audio and video streaming made up another 10%. SNEP additionally reported that nearly half of music consumers (46%) used an audio streaming service, and in 2018, there were 57.5 billion audio streams, up 35% year over year. German counterpart BVMI also announced that streaming had also surpassed physical in terms of revenue, and in Spain, streaming accounts for 75% of all recorded music revenue, according to Promusicae.

South African Artist Files Copyright Infringement Lawsuit Against David Guetta Over “Light Headed”

South African artist Daniel Baron is suing French DJ David Guetta for allegedly ripping off Baron’s 2016 single, “Children of the Sun.” Guetta’s collaboration with Sia, called “Light Headed,” features a vaguely familiar chord riff and melody line. Baron noticed in his research that Guetta was in South Africa in 2017 when “Children of the Sun” would have been on local radio. He added, “Guetta was playing at Ultra that year, so there is a high possibility that one of the other DJs played my song and he heart it.” Not wanting to make a public scene, Baron first consulted with music attorneys, and approached Guetta with a formal legal letter in December 2018 requesting that Baron be credited and compensated for the use of his work. Guetta’s label Warner Music has not responded back to the legal dispute.

Random Ramblings

  • Ed Christman: "Why Spotify's Appeal of the CRB Rate Decision is a Huge Deal for Songwriters and Publishers".
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  • A new musical featuring the music of Britney Spears is coming to Broadway.
  • Juice WRLD debuts atop the Billboard 200 albums chart with "Death Race For Love".
  • Afrojack" conquers the main stage in one of the most famous music festivals on the planet.

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