{"id":84379,"date":"2024-05-22T12:06:13","date_gmt":"2024-05-22T16:06:13","guid":{"rendered":"https:\/\/www.cyberlego.com\/web\/2024\/05\/22\/the-nmpa-spotify-and-the-battle-of-the-bundle\/"},"modified":"2024-05-22T12:06:13","modified_gmt":"2024-05-22T16:06:13","slug":"the-nmpa-spotify-and-the-battle-of-the-bundle","status":"publish","type":"post","link":"https:\/\/www.cyberlego.com\/web\/2024\/05\/22\/the-nmpa-spotify-and-the-battle-of-the-bundle\/","title":{"rendered":"The NMPA, Spotify and the Battle of the\u00a0Bundle"},"content":{"rendered":"

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\n\t\u201cWar!\u201d a singer once shouted. \u201cWhat is it good for?\u201d Well, that depends. In the music business, what can seem like grand ideological conflicts are usually just messy public negotiations over money. That doesn\u2019t mean they\u2019re not brutal, though. And sometimes the amounts at stake turn out to be very much worth fighting over. \u00a0<\/p>\n

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\t\t\t\t\tRelated\t\t<\/p>\n<\/h3><\/div>\n

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\t\t\t\t\t\t\"Apple,<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n

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\t\t\t\t\tSpotify to Pay Songwriters About $150 Million Less Next Year With Premium, Duo, Family\u2026\t\t<\/p>\n<\/h3><\/div>\n

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\n\tThe latest industry imbroglio is the National Music Publishers Association\u2019s conflict with Spotify \u2014 call it the Battle of the Bundle \u2014 which could be worth about $150 million next year<\/a>. On March 1, Spotify added access to audiobooks to its standard subscription to create a product that it says qualifies as a bundle under the terms of its 2022 legal settlement of the Phonorecords IV rate-setting procedure with the NMPA. Then, as the settlement says it can do, it allocates part of the subscription cost to the audiobook piece of the bundle in order to qualify for a lower payment to publishers.\u00a0<\/p>\n

\n\tWhether or not Spotify has a legitimate bundle, it sure has chutzpah<\/em> \u2014 converting all of its U.S. subscribers to bundle customers is a bold move. Now it also has a war on its hands. Already, the NMPA has sent the company a cease and desist for alleged unlicensed content<\/a> and the allied Mechanical Licensing Collective (MLC) filed a lawsuit about the bundling<\/a>.<\/p>\n

\n\tThis is only the response to the attack, though. By trying to cut payments to publishers, Spotify essentially attacked the NMPA, with which the streaming services settled, as well as its president and CEO David Israelite<\/strong>, who actually seems to enjoy this kind of combat. Just to be clear, I don\u2019t think that Israelite literally loves fighting, but I do think he gets a certain satisfaction out of being good at it \u2014 he was a champion college debater and he\u2019s a talented amateur poker player. He\u2019s the kind of opponent who thinks strategically, sees several moves ahead and fights on a number of fronts at once.\u00a0<\/p>\n

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\t\t\t\t\tThe MLC Sues Spotify for Bundling, Cutting Royalties for Publishers and\u00a0Songwriters\t\t<\/p>\n<\/h3><\/div>\n

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\n\tThe obvious fight will be the lawsuit filed by the MLC, which is likely to be long and expensive \u2014\u00a0think of it as a long slog of a ground war. The expense of that will be borne by the streaming services, though, since they fund the MLC\u2019s operations under the provisions of the Music Modernization Act. But Israelite will attack on other fronts as well. The cease-and-desist letter marks the beginning of probing attacks, each one small. Spotify now licenses the works it uses but are there a few hundred uses of some works that might have slipped through the cracks? At a maximum of $150,000 per work in statutory damages for willful infringement, those oversights add up fast. Just as important, a slowdown in licensing for other uses, including video, could keep Spotify from moving forward with some of its plans to compete with Apple and Amazon. \u00a0<\/p>\n

\n\tIsraelite will also move forward with what one might call sanctions, by trying to organize different parts of the music business against Spotify, much as Universal Music Group did with TikTok. Most years, the June NMPA Annual Meeting includes the music business version of\u00a0Two Minutes Hate<\/a> for an online company that\u2019s not paying or underpaying rightsholders. That\u2019s in less than a month. It\u2019s hard to know how successful this will be, but it seems reasonable to assume that Spotify is going to have a much harder time booking acts to play its party during next year\u2019s Grammy Week. \u00a0<\/p>\n

\n\tIsraelite has also said he plans to take the fight to Capitol Hill<\/a> with a legislative proposal to give publishers and songwriters more negotiating power. (If war is just the continuation of policy by other means, as Carl von Clausewitz<\/strong> has it, can\u2019t the reverse also be true?) The odds of passing this legislation soon\u00a0don\u2019t seem all that\u00a0high \u2014 right now the odds of passing any <\/em>legislation soon don\u2019t seem all that high \u2014 and if publishers and songwriters had the power to make it happen, they would have been trying already. But it starts a conversation that the NMPA wants to start, and it opens a front where the NMPA can fight at an advantage, partly because Israelite, a former Hill staffer, would fight on his home turf. Could the NMPA could get a hearing on the topic of songwriter pay that would embarrass Spotify? The company could argue that it needs margin relief, and it does, but how would that look on TV?\u00a0<\/p>\n

\n\tIf this sounds like an incredibly elaborate and expensive way to figure out the definition of a bundle, you\u2019re missing the point. Because it is, but also because no one cares. The point, for the NMPA, is to force Spotify to concede, through some combination of litigation, legislation and PR. Strong spotlights create a harsh glare. From Spotify\u2019s perspective, looking for copyright infringement that fell through the cracks might seem like an aggressively-literal reading of the law. But isn\u2019t an automatic bundle aggravatingly literal in its own right?<\/p>\n

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\t\t\t\t\t\t\"David<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n

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\t\t\t\t\tSpotify\u2019s Bundle Plan Is a \u2018Betrayal.\u2019 The NMPA Will Make a Legislative Proposal to Fight It (Guest&nbsp\u2026\t\t<\/p>\n<\/h3><\/div>\n

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\n\tThere\u2019s also a theory that Israelite needs to get music publishers out of a situation he got them into, since he backed the 2022 settlement that allowed for bundles, but this is unfair. Under the decision in the rate-setting case before this, Phonorecords III, bundles were allowed and could be accounted for by subtracting the value of one from the total price, then using the remainder to calculate royalties. Under the Phonorecords IV\u00a0settlement, bundles must be accounted for proportionally, which is far from ideal but a bit better. Obviously, Israelite and the NMPA thought they could get a better deal by settling the case than fighting it out in court, at great expense, and the NMPA board approved it. Arguably, they\u2019d have ended up fighting either way. \u00a0<\/p>\n

\n\tThat brings up another question: Phonorecords IV only covers the period through the end of 2027. Before that, both sides will go back to rate court, each more inclined to fight and less apt to settle. Whatever happens, the publishers will lose predictability and Spotify will look bad, especially compared to its rival streaming services. There could be a long, grinding Cold War that really will be good for nothing.\u00a0<\/p>\n<\/div>\n<\/div>\n

Aller \u00e0 la source<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

\u201cWar!\u201d a singer once shouted. \u201cWhat is it good for?\u201d Well, that depends. In the music business, what can seem like grand ideological conflicts are usually just messy public negotiations over money. That doesn\u2019t mean they\u2019re not brutal, though. And sometimes the amounts at stake turn out to be very much worth fighting over. \u00a0 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[17],"tags":[],"class_list":["post-84379","post","type-post","status-publish","format-standard","hentry","category-musique","et-doesnt-have-format-content","et_post_format-et-post-format-standard"],"_links":{"self":[{"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/posts\/84379","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/comments?post=84379"}],"version-history":[{"count":0,"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/posts\/84379\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/media?parent=84379"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/categories?post=84379"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.cyberlego.com\/web\/wp-json\/wp\/v2\/tags?post=84379"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}