By signing her new global agreement with Universal Music Group, Taylor Swift used her considerable influence to secure a victory for all UMG artists.
"There was one condition that meant more to me than any other point of treatment," Swift posted on Instagram Monday morning (November 19). "As part of my new contract with Universal Music Group, I asked that any sale of their Spotify shares result in a distribution of money to their artists, not recoverable. They have generously accepted this, in what they believe will be much better terms than those previously paid by other major brands … "
While it is not clear that UMG's payment terms are better than those of Sony Music Entertainment, its plan is probably more favorable than Warner Music Group's for some artists. Swift's request that UMG share its earnings in Spotify shares with artists in non-recoverable payments, coincides with what Sony Music Entertainment implemented with its artists and distributed labels when it sold half of its Spotify shares earlier this year for approximately $ 750 million. Some artists received up to $ 1 million in cash.
In August, Warner Music Group sold its entire stake in Spotify for $ 504 million. The $ 126 million that the artists shared from the sale was credited to the artists' accounts in their royalty statements, but they were not recoverable. In other words, if an artist has not yet recovered, the payment was destined to the balance that the artist still owed to WMG, unlike a royalty without commitment. Distributed labels also shared the unforeseen gain on their contracts.
UMG is still the last of the big three to maintain its Spotify shares: its 5% equals around $ 531 million, until June 30. The company has not announced any intention to sell, although in March it said it would. Share the revenue with the artists in case you download your Spotify stock. Making non-recoverable royalty payments, that is, without commitment, regardless of whether an artist still owns the tag money, was Swift's request, although sources say that UMG was leaning that way to begin with. For now, any liquidation is likely to be suspended as UMG's mother, Vivendi, plans to sell up to 50% of the company.
The artist-friendly movement makes sense as labels face increasing competition for talent in the age of streaming, with acts that have more options than ever, including the omission of traditional labels.
This is not the first time that Swift uses his power of persuasion to help all artists: in 2015, Swift wrote an open letter to the CEO of Apple. Tim Cook exhorting the company for its plan not to pay royalties to artists and producers during a 3-month free trial to promote the release of Apple Music. Cook reversed Apple's policy.
Swift's story with Spotify has been awkward: he took his music out of the streaming service for three years, from 2014 to 2017, because he felt that Spotify paid artists too small a royalty.
Swift believes that the consent of UMG "is a sign that we are heading towards a positive change for the creators, a goal that I will never stop trying to help achieve, in any way I can". I am very happy to have Sir Lucian Grainge as a partner in these efforts. "
UMG declined to comment.
Ed Christman and Hannah Karp helped prepare this story.