Summer is in full swing, and one of the things I look forward to the most during the summer season is spending more time with my family. And I know I’m not the only one: kids are out of school, parents can take vacations, and life seems to slow down a little bit. Check your social media and you’ll see it – friends are posting photos of family vacations, or of family reunions, or maybe just lazy afternoons with the family at the neighborhood swimming pool. Family.
But summer is also the season of sequels, and after making a big splash this spring by contesting a royalty rate increase for songwriters, Spotify is back with a new blockbuster in their effort to underpay creators that rivals any horror film. And it hinges on that same word: Family.
You may recall that in March, Spotify announced that it would challenge a ruling by the Copyright Royalty Board (CRB) that raised payments to songwriters and publishers by nearly 44 percent, the largest increase for songwriters in the history of the CRB. While that challenge is pending, last week Spotify announced that according to the new, higher rates, it has actually overpaid songwriters.
When establishing the new rate increase, the CRB also provided a discount on the rate for family subscription plans offered by digital streaming services like Spotify. Instead of counting every member of a family as a subscriber, a family plan only counts as 1.5 subscribers. So Spotify went back and recalculated all of its payments since the rates went into effect and decided they want to use the “family discount.”
Businesses use “family discounts” to help make life just a little bit easier for families. A family discount might mean you can all go out to a nice dinner once in a while or stretch your dollar a little further when you take a trip. Similarly, a family subscription plan may make it easier for a family to pay for all the music they listen to, but Spotify has turned the idea on its head to make life harder for the families of working songwriters who rely on the royalties they receive from streaming to make a living.
Think about that for a moment. Spotify has taken an idea that’s intended to help families, and twisted it into something that will punish songwriters and their families. As the Recording Academy’s Daryl Friedman put it, “Spotify’s so-called ‘overpayment’ is simply the latest example of a company seeking to pay as little as possible for the music that drives its business. The irony is that they’re using their ‘family plan’ to justify this move, while the only family plan for songwriters is planning how they can feed their family on Spotify royalties.”
I like to think of the music community as a kind of family too. Songwriters, performers, studio professionals, labels, publishers, and streaming services all come from different places and do different things, but we all rely on each other to thrive and to create and deliver music to fans. After the historic passage of the Music Modernization Act, we demonstrated that when we treat each other like family, we can be successful and achieve things that will benefit everyone. Music creators are eager to keep moving forward, but Spotify insists on extending songwriters a fist instead of an open hand. Spotify must stop reducing songwriters to another cost of doing business and start embracing them like family.
