“Now this is very profound, what rhythm is, and goes far deeper than words. A sight, an emotion, creates this wave in the mind, long before it makes words to fit it ...”
Virginia Woolf
Spotify filed a European antitrust complaint against Apple this week with the European Commission. Daniel Ek, Spotify’s CEO, announced in a Wednesday blog post that Apple applied a series of “technical and experience-limiting restrictions” in the App Store at the expense of the user experience, and he concluded by requesting the EC take action and ensure fair competition.
Not long after Spotify, Google, Pandora, and Amazon filed legal challenges in an attempt to appeal the latest CRB decision to raise royalty rates by 44% to songwriters, Spotify responded in defense of its position in a blog post, pointing out that their issues have more to do with the “complexities” of the CRB’s rate structure. President and CEO of the National Music Publishers’ Association, David Israelite, issued a heated point-by-point response to Spotify’s blog post, calling the appeal “suing songwriters,” and adding, “No one should be fooled by this smokescreen.” He concluded by saying “This fight has just started.”
And YouTube Music and YouTube Music Premium entered the Indian streaming market this week, joining other streaming services like Amazon, Apple Music, Spotify, Gaana, and JioSaavn. The announcement was made by global head of music Lyor Cohen on Tuesday (March 12). YouTube Music Premium will cost 99 rupees ($1.42) a month, and the upgrade from premium will cost 129 rupees ($1.85) per month. The market counts up to 1.3 billion people and 22 major languages.
Now, the details...
Compiled by Heidi Seo
Exploration Weekly - March 15, 2019
Spotify Files Antitrust Complaint Against Apple with the European Commission
Music streaming service Spotify has filed an anti-competition complaint against Apple with the European Commission, the regulatory body of the European Union. Spotify CEO Daniel Ek announced in a recent blog post on Wednesday, “In recent years, Apple has introduced rules to the Apple Store that purposely limit choice and stifle innovation at the expense of the user experience…After trying unsuccessfully to resolve the issues directly with Apple, we’re now requesting that the EC take action to ensure fair competition." He adds that Apple is both the owner of the iOS platform and the App Store, and a competitor to services like Spotify. He cites an example where Apple requires digital services to pay a 30% tax on purchases made through Apple’s payment system, including upgrading from free to premium. Paying the tax would “artificially inflate” the price of Spotify’s premium membership above the price of Apple Music. Ek stated he seeks “the same treatment as numerous other apps on the App Store, like Uber or Deliveroo.” Horacio Gutierrez, Spotify's general counsel and vp, responded when asked whether Spotify will bring a similar complaint in the US, “At this point, we are focused on this action.”
Spotify Defends Appeal of CRB Royalty Rate Rise
Spotify, Amazon, Google, and Pandora have filed legal challenges in an attempt to reverse the CRB decision to raise royalty rates for songwriters by 44%. Spotify defends its appeal by saying it feels it will economically struggle to pay songwriters and publishers more while still paying record labels and artists the majority of its revenues. Based on calculations factoring in the CRB-approved pay rise, between 2018-2022, Spotify - based on its 2018 turnover - would have to pay out $1.54 billion across these five years. That is about $320 million more to songwriters in US royalties. On March 11, Spotify announced in a blog post, “We are supportive of US effective rates rising to 15% between now and 2022 provided they cover the right scope of publishing rights. But the CRB’s 15% rate doesn’t account for all these rights. For example, it doesn’t consider the cost of rights for videos and lyrics.” In addition, the company highlighted the CRB rate rise under “risks related to our business” in its annual financial report to shareholders.
NMPA Issues Point-By-Point Response to Spotify’s Royalty Rate Appeal
Tech companies Spotify, Google, Pandora, and Amazon have received fierce criticism from the songwriting and music-publishing communities after announcing last week that they will be appealing the CRB rate rise of 44% to songwriters. Apple Music is not participating, notably, while Spotify has announced the appeal and explained its side in a recent blog post. David Israelite, president and CEO of the National Music Publishers’ Association (NMPA), has voiced out his criticism of the appeal, amounting it to “suing songwriters”, and this week, he issued a point-by-point response to Spotify’s blog post. He concludes by saying, in part, “This fight has just started.” Spotify and reps for Spotify, Amazon, Google, and Pandora did not immediately respond to requests for comment.
YouTube Music Premium Enters India Streaming Market
YouTube Music has officially launched in India, joining sister service Google Play and other Western-based providers Amazon and Apple Music in the sought-after market of 1.3 billion people. The announcement was made on Tuesday (March 12) by global head of music Lyor Cohen, a launch not too long after Spotify’s entry into the market. There will also be competition with Gaana and JioSaavn in a country that boasts 22 major languages. YouTube Music Premium will cost 99 rupees ($1.42) a month, giving users ad-free access to official songs, albums, singles, and music videos, plus thousands of playlists across any genre or language. In addition, for 129 rupees per month ($1.85), the premium account can be upgraded to include ad-free, background-play access to the entirety of YouTube, including original shows. A free, ad-supported version of the YouTube Music app will also be available for users.
According to an announcement made by the US Copyright Office this week, starting Friday March 15, a new group registration procedure will begin for unpublished works. The Group Registration for Unpublished Works (GRUW) will replace the Unpublished Collections registration procedure. Applicants will no longer be able to submit claims for unpublished collections on the Standard Application or a paper application, and will instead begin to use the new GRUW Online Application to submit electronic deposits for each of the works included in the claim. This new procedure is set to benefit authors of unpublished works by creating a detailed public record of their registration that will identify by title all the works covered by their claim. In addition, every work included in a GRUW application will be separately examined by the Copyright Office’s registration staff. A GRUW application may include up to ten works, and databases, collective works, compilations, and websites are not eligible for this type of registration.
Ad-Supported Hulu Bundled with Spotify Premium at No Extra Cost for US Subscribers
As part of a promotion in the next three months, all Spotify Premium users in the US will get access to Hulu’s streaming VOD plan with ads for no extra cost. Spotify customers must move to claim their free Hulu account before June 10. In addition, the number of Spotify accounts eligible for the offer is limited. Once opted into the offer, Spotify Premium subscribers will have access to ad-supported Hulu indefinitely at the $9.99 per-month bundle price, with no expiration date. A year ago, the two companies teamed up to offer Premium and Hulu for $12.99 monthly. This year’s promotion can be viewed as a temporary price cut of the Spotify/Hulu bundle. Hulu is aggressively pushing these types of promotional deals and discount pricing in order to build up its base in the face of competition from Netflix and other streaming rivals. Last month, Hulu lowered the official price of the ad-supported plan from $7.99 to $5.99 per month.
Maggie Rogers Opens Up YouTube Music’s New Artist on the Rise Content Series
YouTube Music’s emerging artist program Artist on the Rise is expanding with a new content series. The video series will be produced in exclusive partnership with Genius, capturing “intimate interviews” with artists and their reactions to old YouTube videos of themselves. Fans will also be able to “showcase the artists’ evolution and connection with fans on YouTube.” The first episode has launched on Tuesday (March 12) with Maggie Rogers marking the first Artist on the Rise of 2019. It can be seen on her YouTube channel. New episodes will coincide with the launch of each Artist on the Rise featured artist, including 2019 selections Gunna, Dermot Kennedy, and many others. Says Lyor Cohen, Global Head of Music at YouTube, “Every artist has stories that reveal more about who they are and how they’ve found inspiration and influences from their community of fans...There’s no better platform than YouTube for artists to reach and connect directly with fans and through our new Artist on The Rise Content Series, we’re providing a way for emerging artists to share their unique journey with the fans that have been right there with them along the way.”
Spotify and YouTube Both Strike Promo Deal with Samsung
Spotify and Samsung are expanding their partnership by pre-installing the music app on “millions” of new Samsung mobile phones, including its new Galaxy S10 and Fold smartphones. Eligible consumers with select Samsung devices in the US will also qualify for six months of free Spotify Premium, redeemable in app, according to reports by the streaming service. YouTube is also another streaming service with a promotion underway with Samsung. The company announced in a recent blog post, “YouTube is giving Samsung Galaxy S10 customers a reason to celebrate by giving the gift of YouTube Premium! Starting today, users can enjoy four months of free, uninterrupted, ad-free access to YouTube, and our new music streaming service, YouTube Music.” The offer will also be available globally where YouTube’s subscription service is available.
LMFAO Reaches Full Settlement Over “Hustlin” Copyright Case
LMFAO has chosen to settle out-of-court following a lengthy discussion over the copyright infringement case over “Hustlin”. According to Rick Ross, LMFAO stole his 2006 song, “Hustlin”. In 2013, he sued the rap duo over their song, “Party Rock Anthem,” claiming they used the phrase he copyright “Everyday I’m Hustlin’.” LMFAO had slightly modified the song’s lyrics to “Everyday I’m Shufflin’” without permission. US District Judge Kathleen M. Williams found that “Hustlin” was not validly registered with the Copyright Office, and because Ross had not established either legal or beneficial ownership of the exclusive right to prepare derivative works for Hustlin’, his motion for summary judgment was denied and the case was dismissed. Judge Williams, instead, stated the co-writers/producers Jermaine Jackson and Andrew Harr’s copyright claims could head to a jury trial, not Ross’. Reports suggest that LMFAO and Jackson/Harr reached a full settlement ahead of a jury trial.
Global Record Industry Generated $18.8 Billion in 2018
In 2018, the global record industry was up $2.2 billion to generate $18.8 billion, according to the latest analysis by MIDiA Research. Of the three majors, Universal Music pocketed 31% or $5.82 billion, seeing its market share increase by 0.6 points. Warner Music also gained 0.6 points and ended the year with a market share of 18.3%, while Sony lost 1.5 points to end 2018 with a 21% market share. One of the biggest takeaways from the research was that, although the major recorded companies enjoyed a combined 69.2% share of the market in 2018, the Artists Direct segment (artists not releasing music through record label) grew by 35% and earned $643 million at year-end. Artists Direct and Independents combined accounted for 30.8% of the market. Streaming was also up 30% year-on-year to reach $9.6 billion with the format becoming the majority of label revenue (51%) for the first time.
Random Ramblings
- The sound of polychromatic music.
- The 34 hits that have debuted at No. 1 on the Billboard Hot 100.
- Jordan Bromley: “The Music Modernization Act: A Songwriter's Guide to What Matters Next".
- G Herbo's "Wilt Chamberlin" is a top trending video on YouTube.
- Mariah Carey drops a subway ride-themed music video for "A No No" under her fifteenth studio album "Caution".
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