Business Frame Weekly – Spotify payout changes could be worth $1bn to artists / Tupac’s Iconic ‘Dear Mama’ Slapped with Copyright Lawsuit

Spotify says its payout changes could be worth $1bn to artists

Tupac’s Iconic ‘Dear Mama’ Slapped with Copyright Lawsuit — 28 Years After Its Release

New Mountain Capital to lead acquisition of BMI, affiliates to receive $100m payout

In this newsletter:

• Spotify says its payout changes could be worth $1bn to artists
• Universal Prevails In Lawsuit Alleging It Owed Artists $750M In Spotify Royalties
• Tupac’s Iconic ‘Dear Mama’ Slapped with Copyright Lawsuit — 28 Years After Its Release
• European CMO Collective GESAC Supports Action to Address ‘Coercive Buyout Practices’
• Backbeat Solutions launches global rights and royalty exchange for production music
• New Mountain Capital to lead acquisition of BMI, affiliates to receive $100m payout

November 28, 2023

Spotify says its payout changes could be worth $1bn to artists

Spotify’s plans to change the way it calculates its streaming royalties have been so thoroughly leaked in recent weeks, it would be surprising if anyone in the music industry still doesn’t know about them. However, this afternoon Spotify has officially announced them, and claimed that they could drive “approximately an additional $1 billion in revenue toward emerging and professional artists over the next five years”. As leaked, there are three main changes, which will begin rolling out “in the new year” according to Spotify’s blog post this afternoon. First, the company will begin fining labels and distributors “per track when flagrant artificial streaming is detected on their content” by its systems. This is about cracking down on streaming fraud, which has been a hot topic for the music industry this year.

Universal Prevails In Lawsuit Alleging It Owed Artists $750M In Spotify Royalties

Universal Music Group (UMG) has won a court case against a proposed class action lawsuit that argued the recording company underpaid its signed artists some $750 million in royalties. Andrus Titus and William McLean, members of the 1990s rap duo Black Sheep, filed the lawsuit this past January, alleging that UMG breached its contract with them, and with other artists, when it allegedly accepted lower royalty payments from Spotify in exchange for a tranche of Spotify stock in 2008.

Tupac’s Iconic ‘Dear Mama’ Slapped with Copyright Lawsuit — 28 Years After Its Release

Twenty-eight years after its release, Tupac’s iconic track ‘Dear Mama’ becomes the subject of a copyright infringement lawsuit. The late Tupac Shakur’s legendary hit, “Dear Mama,” has become the subject of a copyright infringement lawsuit, 28 years after its release. Terence Thomas, known as Master Tee, credited as a producer on the track, alleges that producer Tony D. Pizzaro conspired with executives at Interscope Records and its parent company Universal Music Group (UMG) to obscure his role in creating the track and deprive him of his publishing and master recording copyrights.

European CMO Collective GESAC Supports Action to Address ‘Coercive Buyout Practices’

The report calls on the European Commission to propose necessary measures to address such coercive and harmful practices by global players attempting to bypass EU laws. “An important step has been reached with this strong call for a European action against buy-outs from the two technical Committees of the European Parliament involved in the matter and we are thankful to them,” adds Véronique Desbrosses, General Manager of GESAC. “The creators’ community relies on the European legislator to take the necessary measures to stop the unfairness in the market and ensure that global streamers comply with the EU rules and principles when they operate in Europe,” Desbrosses continues. “Retention of copyright and authors right within Europe is essential for the future of European creativity and economy and we look forward to the confirmation of this strong position of the European Parliament in the Plenary vote.”

Backbeat Solutions launches global rights and royalty exchange for production music

Music royalty software provider Backbeat Solutions has launched a global rights and royalty exchange for production music that will streamline global copyright registration. The Backbeat platform covers all aspects of rights and royalty management, with the company’s cloud-based software designed for the modern music ecosystem. While Backbeat caters for both music publishers and record labels, around half of its client base operates in the fast-growing production music sector. The new system, titled G-RREX, will see metadata uploaded to the Backbeat database automatically pushed to sub-publishers around the world and then further to local societies in each territory. The Backbeat client ecosystem that will be part of G-RREX at launch include independent production music publishers such as Belgium’s Stock Music International and the UK’s Motus Music.

New Mountain Capital to lead acquisition of BMI, affiliates to receive $100m payout

New Mountain Capital will lead a shareholder group to acquire BMI. The investment firm, which has more than $45 billion in assets under management, confirmed the move for BMI today. Terms were not disclosed. Headquartered in New York, BMI is the largest performing rights organisation globally. It protects the rights of and advocates for more than 1.4 million songwriters, composers and music publishers. BMI licenses the performing rights in 22.4 million musical works to businesses. Mike O’Neill, BMI’s president & CEO, will continue to lead the company, along with his leadership team, following the closing. BMI moved to a for-profit model last year. New Mountain will acquire the company from the shareholders who own BMI today. The investment firm has also reserved additional capital to fund growth investments, new ventures and technology enhancements to help accelerate BMI’s long-term plan to maximise distributions for its members and improve the service it provides to songwriters, composers and publishers. As part of the agreement, BMI’s current shareholders will allocate $100 million of the proceeds of the sale to affiliates shortly after the transaction closes. The decision was based on the “recognition of the creativity of the songwriters, composers and publishers they have had the privilege to represent,” according to a statement.

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