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What Did Spotify Know and When Did They Know It?

January 21, 2016

Kiss me once, then once more.
What a dunce I was before.
How long has this been going on?

From How Long Has This Been Going On?
Music by George Gershwin, Lyric by Ira Gershwin from Funny Face

If you have been following the separate class actions for songwriter royalties brought against Spotify by David Lowery and Melissa Ferrick, a question might have occurred to you as it has to me:  How long has Spotify known about its songwriter royalty problem?

Given reports that as much 25% of Spotify’s music offering is unlicensed, surely this didn’t happen the week before the first class action was filed.  That’s millions of songs and that kind of mistake takes some time to get to scale.

Thinking back, I remembered the meetings that Spotify hosted in October 2014 as part of its artist outreach campaign.  Those meetings were held in New York, Nashville and Los Angeles.  If Spotify knew at that time that it had this major songwriter royalty problem, what a perfect opportunity to ask for help from artists and songwriters (and of course artist-songwriters).

We asked Blake Morgan what he remembered about the New York meeting he attended.

MTP:  What’s your take on the songwriter class action lawsuits against Spotify brought by David Lowery and Melissa Ferrick (respectively)?

Blake Morgan: Well, I love it when artists and songwriters stand up to the Goliaths of the world in any fashion, and these two lawsuits are no exception. These are courageous and righteous stands being taken by courageous and righteous people in my opinion. And, they’re stands on behalf of multitudes of music makers––not for personal gain––which is what makes them so powerful, and welcome, in my view. Oh also––I really hope David, Melissa and the songwriters win. There’s that, as well.

MTP:  It’s a little early to say definitively when Spotify started having this unlicensed problem, but it seems to have been happening for a while, perhaps for years.  I remember Spotify’s #thatsongwhen Twitter promotion in 2014 backfired because songwriters used it to speak out about low royalties on Spotify.  I don’t recall any songwriters complaining that there were some songwriters who got no royalties paid by Spotify, do you?

Blake Morgan: That’s right. And here’s the major (and unbelievably simple) problem I think Spotify has here: their attitude seems to have been––again, possibly for years––to just go ahead and use music as they wish first, and maybe, gee whiz, get permission for that music later if they really have to. It’s so arrogant. Why didn’t they just do this instead: “if we can’t find the right holders for a musical work we just won’t stream that musical work.” Done. It’s amazing to me that they really bought into that adage, “it’s better to beg for forgiveness than ask permission.” Hey Spotify, how’s your “forgiveness-asking-campaign” looking now?

(Oh, and by the way…they couldn’t “find” David Lowery? Or Melissa Ferrick? Seriously? Goliath doesn’t know how to use the internet? Who’s the luddite now, Goliath?)

MTP:  Billboard reported that you attended the 2014 New York meeting of Spotify’s outreach campaign that was moderated by Paul Pacifico (CEO of the Featured Artist Coalition) and I believe included a number of people from Spotify, correct?  This is the one where they had a private meeting with managers and then let the artists in?

Blake Morgan: Yes, sad but true. It was an offensive meeting to everyone who was in the room, with the exception of the people from Spotify itself, the people they invited to shill for Spotify in an attempt to get the artists in attendance to drink the Kool aid, and the people from the MMF, who seemed to love the meeting almost as much as they love Spotify. I doubt there was an artist who was there, for whom the meeting was held, who wasn’t incensed.

MTP:  Did Spotify ever ask for help at that meeting in identifying songwriters because they were using unlicensed songs?


Blake Morgan: 
Of course not. The subject never even came up. Here’s what they could have done: “Hi Blake, thanks for coming. We’re here with iPads and clipboards right in the doorway of the meeting because we want to make sure––I know it seems micro-managing of us––that we get the most accurate and up-to-date informations for every artist and songwriter we encounter. So, can you write down your Name, address, PRO, label (if you have one), and publishing company? Thanks!” Never happened.MTP:  They had similar meetings in Nashville and Los Angeles, did you hear that Spotify asked for help at any of those meetings?

Blake Morgan: I know for a fact that they did not. They were, apparently, too busy informing all of us at each of these meetings that our “per stream rate will never go up,” and that “Spotify is Spotify’s product.”

MTP:  Did you get the impression at the New York meeting that Spotify was sitting on 10% to 25% of their tracks without mechanical licenses or payments to songwriters or publishers?
 
Blake Morgan: I honestly had no idea.
[In fairness, Paul Pacifico saw the New York meeting differently according to MusicAlly (“Spotify Admits Its US Tour Encountered Some Problems“):
[T]he Featured Artists Coalition’s Paul Pacifico claims that Morgan was one of “two or three very, very vocal people who came with a strong agenda to deliver some messages to Spotify, as opposed to what we hoped would be more of a dialogue”.]
  1. January 23, 2016 at 14:24

    This whole case brings me to a couple of questions. First, if they have been using mass amounts of music without consent, how do artists who do sign with Spotify know the number of streams of their work Spotify claims occurred is accurate? And how can we trust their per stream calculations? What oversight do we have to guarantee this? Secondly I have a very general question that has to do with tech businesses in the internet age. If I operated a non tech business where I distributed goods that I had no right to, as soon as it was found out I would be in big trouble and so would my business. Why is it that the tech businesses seem so immune to common sense laws that non tech businesses must adhere to?

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