Sony BMG, Universal Music, Warner Music, EMI and Merlin (the body which represents Europe’s independent labels all own shares in Spotify, shares the company offered the labels for an aggregate €8.8 million – presumably as part of the negotiation to secure permission to stream their music online.
Together, the labels own 18 per cent of Spotify. Sony BMG took the lion’s share, now owning 5.8 per cent of the service.
Founded by Daniel Ek & Martin Lorentzon (pictured), Spotify is a refreshing breath of air after the partially major-label owned MySpace Music apparent unwillingness to treat indie labels as peer partners for its somewhat confusing music service.
Indie music labels have slammed the artist royalty scheme announced by Last.fm yesterday, with the global rights body for independent music (Merlin) issuing an all-points bulletin in which it suggested Last.fm has been guilty of using music illegally in the past.
“The Program announced today does not appear to offer any compensation for any past illegal use of repertoire. It is unclear to us whether or not the terms and conditions of the Program are intended to prevent master owners pursuing such compensation. Last.fm yesterday announced a scheme in which unsigned acts could join its Artist Royalty Scheme, under which they get paid each time a track of theirs is streamed and played. The scheme has been ongoing, and was already available to major and indie labels and their acts. While Last.fm’s move is to be welcomed, indie label body Merlin has also been attempting to negotiate a non exclusive blanket licence and a settlement agreement for previous instances in which Last.fm has offered music for streaming without permission. However, those negotiations stalled, “in part because Last.fm has not been willing to admit to or to compensate for any prior illegal use of music,” Merlin said.
Merlin represents over 12,000 indie labels who between them hold a US music marketshare of 8 per cent. Independent sector global market share 2006 is 27.5%, )source Music & Copyright, Jul 2007).