Music Industry Battles for a Piece of the Financial Pie

Christopher Sabec SpotifyA recent article in The Guardian talks about recent news in the courts regarding US music copyright. The battle is between the music industries powerful lobbying giants vs. the major online music streaming companies. Both are fighting for their piece of the financial pie. The two major players recently combating against one another are the Recording Industry Association of America (RIAA) and Spotify. There are other major music licensing groups in the midst of all of this. Everyone is saying that major revisions are needed considering the changing music industry.

The article states that Christopher Springman, who teaches copyright law at NYU, states that there is not much interest between these major players and the public interest. The main goals for all entities at hand are to make sure that their finances are appropriately in order.

Whereas organizations like Ascap and BMI are attempting to increase the royalty rates given to songwriters, streaming services like Pandora and Spotify are fighting to keep those rates so that they can become profitable. Music is an industry where there is a giant piece of the pie that people are more fighting over than trying to figure out how to make it bigger.

Another point of contentions comes with the mechanical statutory rates, which gives record labels the right to reproduce and distribute songs at an agreed upon price. This gives more power to record labels because they are able to negotiate higher rates, whereas publishers have to stick to the government rates.

Record labels are silent in the midst of all of this turmoil because they don’t have much to complain about. They don’t mind licensing the music that they represent to these interactive services because they are able to negotiate prices for themselves. Musicians, on the other hand, are seeing less and less of the pie as their compensation does not seem to increasing along with the record labels.

This article is based off of this article.