More than 100 professional songwriters and producers in Sweden have signed an open letter to the likes of Spotify demanding bigger payouts from streaming services, at the debate around how music royalties are divided hots up.
The letter points to a November 2014 study in US, which suggested that songwriters were receiving just 3% of revenue from streaming services in the territory – though what’s not mentioned is that this research was exclusively based on data regarding online radio services such as Pandora, rather than ‘all-you-can-eat’ platforms such as Spotify.
As you can read in the full translated letter below, the Swedish writers claim that the “allocation of revenue in the EU surely doesn’t differ substantially”.
The letter appeared today in Aftonbladet, one of Scandinavia’s biggest-selling newspapers, according to The Guardian.
Creatives who have worked with the likes of Britney Spears and The Saturdays have put their name to the essay, entitled ‘It’s time to say thank you for the music’.
Rather than relentlessly browbeating streaming services, the writers call for a pragmatic end to the way royalties are currently apportioned between labels, artists, publishers and songwriters. They demand a “more balanced and sustainable distribution of revenues from services such as Spotify”.
The writers claim that the seeds were sown for disproportionate royalties shares during Spotify’s beginnings in 2008. “Several of the major record companies demanded touch conditions to license their music: part ownership of Spotify and a large piece of the revenue pie,” they write.
“Music publishers and STIM, representing songwriters, joined on bad terms just to [help] Spotify get started. No-one wanted to stand in the way of technological progress, or the ability to [smack] pirate services on the fingers.”
The group, whose members include hit artist/writers such as Andreas Johnson (pictured) and EagleEye Cherry, also call for a shutdown of NDAs between Spotify and collection societies, and ask streaming services to add writer and producer credits to tracks.
The petition echos the efforts of BASCA’s The Day The Music Died campaign in the UK, which is calling for a broadcast license-style 50/50 split of streaming payouts between artists/labels and writers/publishers.
It comes less than two years after songwriters in Sweden threatened to the sue major labels if they didn’t agree to a more balanced royalty division.
A recent study by record company body SNEP in France estimated that major labels keep an average of 73% of Spotify’s total payouts after tax, with artists holding onto 11% and writers and publishers sharing 16%.
It’s time to say thank you for the music
During the autumn, the debate [around streaming royalties] became hot after Taylor Swift’s decision to remove her catalogue from Spotify.
Swift, currently the world’s best-selling recording artist, claimed that Spotify devalues music’s value, mainly by offering subscribers an ad-supported free service but also by giving too little back to those whose work Spotify has built its business model on: songwriters.
Daniel Ek, Spotify founder, responded that the company gives back 60-70 percent of their revenue to the music industry, and chairman Martin Lorentzon announced that he had “zero understanding” of artists and authors’ demands for better compensation.
According to a survey from November 2014, only 3% of the Spotify’s revenues that go to the music industry in the United States gets back to the songwriters. No similar study has been made in Europe, but the distribution deviates certainly not differ significantly from that in the US.
Despite this, most of the debate has centered on the artists and record companies. Songwriters voices are seldom or never heard.
But the vast majority of chart music, which is streamed the most, is created by songwriters who are not artists. They are unable to tour, selling merchandise, or otherwise compensate for the loss of revenue in this digital market.
The inevitable result is that record companies and other industry players in danger of sawing off the branch they sit on – then very few will be able to afford to write songs outside a hobby.
“The vast majority of chart music, the most-streamed [genre] is created by songwriters who are not artists.”
Ten years ago, when the downloading debate was at its peak, the record companies were on their knees because [of piracy]. When Spotify presented their business idea, there were few in the industry who believed that it would have any major impact. Moreover, it would of course mean that they sold even fewer CDs.
Several of the major record companies demanded tough conditions to license the music: part-ownership of Spotify and a large piece of the revenue pie.
Music publishers and STIM, representing songwriters, joined on bad terms to let Spotify get started. No-one wanted to stand in the way of technological progress, or the ability to [smack] pirate services on the fingers.
Today we see the consequences. The digital revolution has meant that record companies drastically reduced their costs of production and distribution of music.
In recent years, the record industry in Sweden flourished thanks to Spotify, and indications are that Europe and the rest of the world will follow suit. But the songwriters, investing time and money into creating the music service offering, have not received anything back. It is therefore high time to create balance in the distribution of digital revenues.
Songwriters organization Cabinet has today, February 16, invited music industry players to a meeting. We want to discuss how we can work together to create a more balanced and sustainable distribution of revenues from services such as Spotify.
“We need an allocation model that allows the whole industry to thrive, not just record labels and distributors who live on the value we musicians produce.”
The first step should be greater transparency. Spotify, other digital services and record companies make use of so-called NDAs – Non-Disclosure Agreements – to prevent transparency in the distribution [of royalties].
STIM and the other collecting societies are forced to sign these confidentiality agreements and can’t even reveal the breakdown to their members. Their suppliers – the songwriters – must not know how much they get paid for their products… the songs.
The second step should be to find an allocation model that allows the whole industry to thrive, not just the record labels and distributors who live on the value we musicians produce.
A third step that should be discussed is that very few of streaming services endeavored to add credits of songwriters and producers [to tracks]. We think it is not right that those who created the music also should get credit for it.
Sweden has come a long way in the development of digital music services. It is also reasonable that we, with our relatively small music market and the history of the spirit of consensus, showing the way to a more sustainable and equitable model.
Let us ensure that today’s meeting will be a door opener.
Lasse Andersson
Tomas Andersson Wiij
Johan Becker
Johan Bejerholm
Daniel Bengtson
Anoo Bhagawan
Arnthor Birgisson
Peter Boström
Jonas von der Burg
Niclas von der Burg
EagleEye Cherry
Robert “Strängen” Dahlqvist
Adrian Davinski
Joy Deb
Linnea Deb
Moh Denebi
Ana Diaz
Niklas Edberger
Olle Ekberg
Per Eklund
David Elfström Lilja
Jade Ell
Lina Eriksson
Mårten Eriksson
Peter Alexander Esbjörnsson
Annika Fehling
Oscar Fogelström
Mikael Frithiof
Tobias Fröberg
Magnus Funemyr
Aleena Gibson
Daniel Gidlund
Daniel Gilbert
Håkan Glänte
Irya Gmeyner
Thomas Gson
Robert Habolin
Peter Hallström
Thomas Hanna
Oscar Harryson
Mats Hedström
Uno Helmersson
Patrik Henzel
Louise Hoffsten
Anton Hård Af Segerstad
Henrik Janson
Martin Jarbeck
Niklas Jarl
Niels Jensen
Andreas Jismark
Andreas Johnson
Karina Kampe
Magnus Kaxe
Jackie Kavan
Niclas Kings
Jörgen Kjellgren
David Kruger
Jimmy Lagnefors
Anders Larsson
Tim Larsson
Caroline Leander
Peter Lemarc
Ari LeTennen
Mattias Lindblom
Helienne Lindvall
Martin Lorentzson
Patrik Lorentzson
Tobias Lundgren
Niclas Lundin
Malin Maggie Lybeck
Bernard Löhr
Rikard Löfgren
Viktor Löfgren
Henrik Lörstad
Awa Manneh
Erik Martensson
Andreas Mattsson
Peter Jacobsson Morén
Per Magnusson
Tony Malm
Maria Marcus
Johan Moraeus
David Myhr
Anders Nilsson
Henrik Nordenback
Johan Norrby
Erik Nyholm
Mats Nyman
Thomas Nyrre Nyström
Pauline K Olofsson
Emanuel Olsson
Ollie Olsson
Per Olsson
Jonas Quant
Eric Palmqwist
Miqael Persson aka Hicks
Niklas Pettersson
Eddie Rahmati
Johan Ramström
Sigurd Resnes
Anders Ringman
Elias Ringquist
Leah Muscat Rodo
Åsa Rydman
Anders F Rönnblom
Sigurd Røsnes
Hanif Hitmanic Sabzevari
Erik Sahlen
Ken Sandin
Jerry Sillah
Fredrik Sonefors
Linda Sonnvik
Nicklas Stenemo
Dan Sundquist
Markus Svensson
Andreas Söderlund
Fredrik Söderström
Anna Ternheim
Fredrik Thomander
Max Thulin
Peo Thyrén
Johanna Toth
Mats Tärnfors
Samuel Waermö
Johan Vegna
Christian Waltz
Pär Wiksten
Anders Wikström
Henrik Wikström
Anders Wollbeck
Jonas MoonChild Zekkari
Fredrik Fredro Ödesjö
Frida Öhrn
Stefan Örn
Music Business Worldwide
