Spotify and Universal Unveil Far-Reaching Deal That Improves ‘Bundling’ Payment Structure

variety.com:

Jem Aswad Executive Editor, Music Universal Music Group, the world’s largest music company, and Spotify, the world’s largest paid streaming service, announced on Sunday new, multi-year agreements for recorded music and music publishing “focused on growth, innovation and the advancement of artists’ and songwriters’ success,” according to the joint announcement.

It also marks the first direct license between Spotify and a major publisher in several years. While terms of the deal were not announced, sources confirm to Variety that the deal improves at least some of the payment structure of Spotify’s controversial music-audiobooks “bundling” deal, announced last year, which meant a lower mechanical royalty for songwriters and was so roundly condemned by rights-holders that the National Music Publishers Association filed a legal complaint against the streaming giant in June.

Sources tell Variety that although the new deal does not completely ameliorate that payment reduction, it does improve it; considering that Universal Music Publishing CEO Jody Gerson was one of the loudest voices criticizing the bundle, the terms must represent at least some significant improvements.

A Spotify rep said in a separate statement, “Spotify maintains its bundle, but with this direct deal [with UMPG], it has evolved to account for broader rights, including a different economic treatment for music and non-music content.” The unusual Sunday-afternoon timing of the announcement was due to the news leaking to Music Business Worldwide, which was first to report the deal.