Universal Music Group is yet to sell any of its Spotify shares which, according to MBW’s calculations, are currently worth around $850m.
That’s led to much discussion in the artist community about what will happen when UMG does bank its 3.5% stake in the streaming company.
One question has been asked louder than any other: will Universal follow the lead of Sony Music and pay its artists a share of this cash without withholding money owed by their individual unrecouped balances?
Today (November 19), we got our answer, courtesy of Taylor Swift.
Writing on Instagram to announce her new deal with UMG, Swift wrote: “There was one condition which meant more to me than any other deal point. As part of my new contract with Universal Music Group, I asked that any sale of their Spotify shares result in a distribution of money to their artists, non-recoupable.”
“As part of my new contract with Universal Music Group, I asked that any sale of their Spotify shares result in a distribution of money to their artists, non-recoupable.”
She added: “They have generously agreed to this, at what they believe will be much better terms than paid out previously by other major labels. I see this as a sign that we are headed towards positive change for creators – a goal I’m never going to stop trying to help to achieve, in whatever ways I can. I’m so happy to have Sir Lucian Grainge as a partner in these efforts.”
In the same post, Swift confirmed that, as part of her new UMG deal, she will retain ownership of the masters of her future recordings.
Sony announced in June that it would be dismissing any individual unrecouped artist balances when it came to paying out proceeds from its 5.7% Spotify stake.
Since then, Sony has sold 50% of this stake, banking $768m in total.
Warner Music Group, meanwhile, announced in August that it had sold its entire Spotify stake for gross proceeds of $504m.
WMG handed 25% of this money to its artist accounts, but did not ignore their unrecouped balances – meaning that a significant proportion of this cash actually remained at WMG.
This isn’t the first time that Taylor Swift has been credited with working magic on behalf of the wider artist community: in 2015, she publicly called on Apple to compensate artists for music played by Apple Music users during their free trial of the service.
Apple’s Eddy Cue later announced that the company was bowing to Swift’s request.
[Pictured: UMG’s Sir Lucian Grainge, Taylor Swift and Republic’s Monte Lipman via Swift’s Instagram account.]Music Business Worldwide