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Spotify to pay $21M in Missing Royalties to Publishers & Artists

March 17, 2016 - Written By Alexander Maxham

Spotify, perhaps the most popular streaming music service, has been a bit of hot water as of late. Since word came out that Spotify hadn’t paid out all of the royalties that they should have, many haven’t been too happy with the service. Especially artists that were missing their royalties. However, today Spotify and the National Music Publishers Association have reached an agreement over the missing royalties and damages for this whole issue. Spotify will pay around $21 million to resolve this issue. This money will go to both publishers and songwriters in this new deal. The settlement breaks down as $16 million being set aside for royalty payments with $5 million bonus fund for publishers and songwriters who decide to opt into this deal.

The National Music Publishers Association or NMPA, President and CEO David Israelite, stated that this deal is considered a win for publishers and songwriters. In addition tot hat Israelite also stated that the NMPA will continue to push for digital services and streaming services such as Spotify, to properly pay out royalties to all those involved. Something that is important in this day and age where many aren’t buying the physical music on CD’s and such. And often times not even buying the song from an online store, but simply streaming it when they want to do so.

With this deal, Spotify is covered for all content that they have streamed since being created back in 2006 and all the way until June 30th, 2017. The music streaming service hopes that the deal here will also eliminate the complaints from publishers and songwriters. So that Spotify will be able to move on from these lawsuits. YouTube struck a deal like this with the NMPA in 2011, and after the deal was set, many of the lawsuits were dropped.

For those publishers and songwriters affected by the unpaid royalties, they’ll be able to claim their unpaid royalties beginning in April and for the three months following that. Spotify will be setting up a portal for those parties to claim. If there is any money left over from this deal, it will be split with publishers and songwriters based on their market share on Spotify.