Music Publishing, collection societies
Tensions between Spotify and National Music Publishers Association are reportedly rising in the USA with the arguments now focussing on the so called ‘mechanical right’ which generates a mechanical royalties on Spotify streams – and which cannot be collected bu US collecting societies BMI and ASCAP which only represent the performing rights in songs.
Spotify can benefit from the compulsory licence schemes for mechanical rights Stateside, and hired The Harry Fox Agency (previously owned by the NMPA) to manage the process, but a group of independent songwriters and music publishers who were not represented by HFA went unpaid, and this resulted in class action litigation led by musicians David Lowery and Melissa Ferrick – a battle where the NMPA intervened as a peace maker: as the legal battle began in early 2016, the NMPA announced a settlement deal with Spotify over previously unpaid mechanicals. Subsequently Lowery and Ferrick’s class actions were settled in May this year.
But now reports say that the NMPA has been pushing for new commitments from Spotify (not least as the major recorded music groups have equity stakes in the soon to be listed streaming giant – unlike the major music publishers) and are challenging the streaming company’s often used excuse that it cannot always pay mechanicals royaties as there simply isn’t an accurate database of music rights owners to access. The NMPA has stated in a recent letter that it knows of examples where mechanical royalties went unpaid on songs where the ownership information for said works was clearly listed at the US Copyright Office. Will legal action follow?