Spotify is trying to rebuild how some artists are paid. In a blog post, the company announced it was going to dump resources into a “comprehensive publishing administration system.”
The reason for this move? Clarity:
Music industry licensing and copyright structures are legendary in their complexity – and they change from country to country and agreement to agreement. One of the most difficult challenges is the lack of accurate data as to who owns the rights to a specific track, especially when it comes to songwriter and publisher rights. In many cases, the ownership of the rights are not even finalized when a record is released; in many other cases, rights are held by multiple parties, rights change hands, and rightsholders remain entirely unclear.
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Currently, Spotify sets aside royalties for rightsholders, but sometimes the company doesn’t immediately know who that might be. With this system, Spotify hopes to streamline how artists are paid, and that money will find its way to the right people — quickly.
The company says it’s paid a total of $3 billion in royalties (over the life of the product), and less than one percent of that has been lost in limbo. Bigger artists like Taylor Swift likely wouldn’t feel the pinch, but lesser-known musicians may find Spotify’s plan favorable for being paid quickly.
Unfortunately, the program itself won’t be available any time soon. Spotify says it’s “going to take significant time and effort.”
➤ Spotify Songwriters and Publishers Administration System [Spotify via Billboard]