What is On-Demand Music Streaming?

On-demand music streaming contrasts with non-interactive webcasting because it is an interactive service, meaning the user is able to listen to any song in the Digital Service Provider (DSP)’s database without any restrictions on time or playback capabilities. The user can pause, skip, rewind, and create playlists—but not copy the digital file.

Popular on-demand music streaming services include Spotify, Tidal, SoundCloud, Apple Music, and Bandcamp. In the world of computing, such DSPs are considered “cloud servers,” meaning they operate via remote servers which store data and allow users to access them wherever there is access to the internet.

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In this newsletter:

Pandora has responded to a lawsuit filed by collecting society MLC in a dispute over whether or not the streaming platform’s personalized radio service should be classified as interactive or non-interactive.

SAG-AFTRA has reached a tentative multiyear agreement with major music companies. The deal includes guidelines for the use of artificial intelligence in the industry.

The Latin Grammys are returning to the United States this year, with Miami hosting the 25th annual ceremony on Nov. 14 at the Kaseya Center. Nominations will be revealed on Sept. 17.

Now, the details...

Exploration Weekly - April 19, 2024
Compiled by Ana Berberana

MLC Lawsuit is “Wild Overreach” Says Pandora, Accusing US Mechanicals Society of “Legal Frolics”

A lawsuit filed against US streaming service Pandora by the MLC is “a wild overreach” of the US mechanical rights collecting society’s remit. Or so says Pandora, in its response to that lawsuit. As well as disputing the claims made against it - the MLC “apparently thinks it knows better than the entire music publishing industry”, it says - Pandora reckons that the society, paid for by the digital platforms, isn’t meant to use its funding to “pursue legal frolics and detours”. Expanding on that theme, Pandora argues that the MLC is not “authorized to play judge and jury over a streaming service’s legal compliance”, nor can it “insist that Pandora fundamentally change its approach to licensing an entire tier of its service solely because the MLC has taken upon itself to press a legally incoherent position at odds with the view of the rest of the music industry”. This dispute centers on what licenses Pandora requires when it comes to the songs that its users stream. With on-demand streaming, like Spotify, it is agreed that services exploit both the performing rights and the mechanical rights of songs. In the US, collecting societies like BMI and ASCAP license the performing rights, while the MLC administers the compulsory license that covers mechanical rights. Pandora offers an on-demand streaming service which is licensed in that way. However, the core Pandora product - Pandora Free - is an ad-funded personalized radio service which doesn’t allow users to pick tracks on-demand except in certain circumstances. Under the US system that is classified as ‘non-interactive’ and it has generally been agreed that, in that scenario, only a performing rights license is required. Users of the free personalized radio service can access 30 minutes of on-demand music in return for watching an advert via a promotion called Sponsored Premium Access (SPA). And Pandora accepts that, when a user does that, for 30 minutes they are using an interactive service during which time mechanical rights are being exploited. However, the MLC argues that the availability of Sponsored Premium Access means the entire personalized radio service should be classified as interactive, and therefore mechanical rights are in play. That would require Pandora to pay mechanical royalties to the MLC for all usage of the personalized radio service, and not just when a user opts into Sponsored Premium Access. Justifying that position in a lawsuit filed in February, the MLC stated, “Users of Pandora Free can select and receive streams of particular sound recordings on-demand at any time." In its response, Pandora argues that the MLC is misrepresenting the law and going against years of music industry convention. “For over six years Pandora has offered its users of free internet radio service the ability to access Sponsored Premium Access sessions. At no point during that time has anyone else in the music publishing or recorded music industry alleged that the limited availability of SPA sessions to Pandora’s free-tier users turns the entirety of that tier into an interactive service like Spotify or Apple Music”.

SAG-AFTRA and Major Labels Reach Deal for Artificial Intelligence Protections

SAG-AFTRA, the union representing roughly 160,000 actors, dancers, singers, recording artists and other media professionals, and all three major music companies reached a tentative multi-year agreement last week that includes guardrails for the use of artificial intelligence technology across the industry. A successor to the SAG-AFTRA National Code of Fair Practice for Sound Recordings, the new deal received unanimous approval from the guild’s executive committee and, if ratified by member vote, will cover the period beginning Jan. 1, 2021 through Dec. 31, 2026. Participating labels include Sony Music Entertainment, Universal Music Group and Warner Music Group, as well as Disney Music Group. The AI guidelines require that the use of terms such as “artist,” “singer” and “royalty artist” only refer to actual humans, plus the deal calls for clear consent, minimum compensation and other stipulations prior to the release of a sound recording using a digital replication of a real artist’s voice. The tentative contract also includes increased minimums, health and retirement improvements, and an increase in the percentage of streaming revenue to be covered by contributions. “This agreement ensures that our members are protected,” said Duncan Crabtree-Ireland, SAG-AFTRA national executive director. “SAG-AFTRA stands firm in the belief that while technology can enhance the creative process, the essence of music must always be rooted in genuine human expression and experience. We look forward to working alongside our industry partners to foster an environment where innovation serves to elevate, not diminish, the unique value of each artist’s contribution to our rich cultural tapestry.”

Latin Grammys Will Return to the U.S. With 2024 Show to Take Place in Miami

The Latin Grammys will happen in Miami this year, marking the Spanish-language awards show’s return to the United States just one year after it made a controversial move to Spain. The 25th annual show will air live from the Kaseya Center on Nov. 14. Nominations will be announced on Sept. 17. The 2023 iteration of the Latin Grammys was held in Sevilla, Spain as part of a multi-million dollar deal between the government of Andalusia and the Latin Recording Academy. This was the first time in the 23-year-long history of the Latin Grammys that the ceremony was held outside of the United States. The show is known for its international reach — supporting Ibero-American artists and/or those who record in Spanish or Portuguese. However, the move to Spain was fairly unexpected, and largely critiqued, considering how many of the nominees come from the Americas. “Since our first awards presentation in the year 2000, the Latin Grammys have provided an international spotlight for Latin music second to none and provided iconic performances that have become part of global music and pop culture history. We are thrilled to celebrate our 25th anniversary in Miami” said Manuel Abud, CEO, the Latin Recording Academy. “Miami has evolved to become the epicenter of Latin entertainment and we are grateful for the community support and enthusiasm we have received.” This is the third time that the ceremony will be held in Miami, where the Latin Academy’s headquarters are based.

The Recording Academy & Coursera Launch Grammy Go

The Recording Academy has partnered with Coursera to launch Grammy Go, an online initiative to offer classes geared towards music creators and industry professionals. As part of the Academy’s ongoing goal to serve all music people, this program empowers the next generation of the music community with content that provides wisdom for both emerging and established members of the industry. It will offer a plethora of topics tailored to creative and professional growth, and will include courses taught by Recording Academy members, as well as Grammy winners and nominees offering real-life lessons learners can put to work right away. “Whether it be through a Grammy Museum program, Grammy Camp or Grammy U, the Grammy organization is committed to helping music creators flourish, and the Recording Academy is proud to introduce our newest learning platform Grammy Go in partnership with Coursera,” says Panos A. Panay, President of the Recording Academy. “A creator’s growth path is ongoing, and these courses have been crafted to provide learners with the essential tools to grow in their professional and creative journeys.” Enrollment is already open for the first Grammy Go course, “Building Your Audience for Music Professionals.” The course will be taught by international music/marketing executive Joey Harris, and will also feature Rock & Roll Hall of Fame inductee Jimmy Jam, 10-time Grammy nominee Janelle Monáe and three-time Grammy winner Victoria Monét. Participants in the course will gain the skills, knowledge and confidence to build a strong brand presence and gain a devoted audience.

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