The UK-based Music Managers Forum has applauded Sony’s Spotify equity payout — the details of which were revealed last week.
The terms under which Sony will share its spoils from the sale of 50% of its Spotify stock – amounting to around $750m – have been deemed a “progressive move” by MMF CEO Annabella Coldrick.
Sony will pay out its Spotify money to all eligible artists and partner labels, regardless of what is decreed in their individual contracts.
In addition, the major label has committed to ignoring all unrecouped balances (for both artists and labels) in relation to its share money payouts.
Coldrick said: “The Music Managers Forum has long campaigned for the income from Spotify equity to be shared with artists whose music the labels traded.
“We’re very pleased to hear from Sony that they will be doing this both directly and with artists signed to distributed labels, and not off-setting it against recoupment.
“This is a progressive move which we hope to see reflected more widely in the industry and across other non-attributed income such as Facebook.”
annabella coldrick, mmf (pictured)
“This is a progressive move which we hope to see reflected more widely in the industry and across other non-attributed income such as Facebook.
“The music industry is changing and the future will be different from the past. Labels will work increasingly in partnership with artists and not be “owners” of their rights.
“This shift should see more equitable shares of all revenue going to the artists and songwriters, not just on a royalty basis.”
Coldrick is clearly calling on Universal and Warner to match Sony’s generosity with their Spotify equity payouts to artists and partner labels – but that ‘s not as easy as it sounds.
As we noted in this piece the other day…
Sony has laid down the gauntlet to its main rivals here. Will Universal and Warner be able to match its financial self-sacrifice?
It may prove difficult.
For example, Warner has already said it won’t be sharing its Spotify windfall with all of its partner labels – only those who have a stipulation in their contract regarding this money.
If Warner sticks to this policy, I give it weeks before Sony’s business development hounds are on the phone to the disappointed parties.
Universal’s issue is less about what it’s already said, and more who it has to convince.
Vivendi is currently looking at an IPO, part-IPO or part-sale of UMG – for which the major’s EBITDA margin will prove all-important.
If Sir Lucian Grainge feels his company now has to match Sony’s moves RE: Spotify equity – especially in terms of ignoring unrecouped balances and taking no percentage from indie label payouts – Vivendi may prove difficult to convince.Music Business Worldwide