Spotify Exiting Uruguay Market After Fair Pay Bill Legalized There

[RAMROD 104,915]

Spotify has confirmed that it will end its service in Uruguay, after the country's Parliament approved an amendment to its copyright law that would require "equitable remuneration" for artists.

A spokesperson confirmed yesterday (Monday 20) that Spotify will begin to "phase out" its service in the country from January 1, 2024 — will all operations ceasing by February.

The bill, which is titled "Rendición de Cuentas," was first introduced by Uruguayan Society of Performers (SUDEI) earlier this year, proposing to amend Articles 284 & 285 of Uruguays copyright law.

The modification, which was approved by the Uruguayan Parliament last month, is set to introduce a requirement for "fair and equitable remuneration" for artists in regards to their recorded material.

The bill also introduces a requirement for "social networks and the Internet" to be treated as "formats for which, if a song is reproduced, the performer is entitled to financial remuneration."

The streaming giant had first threatened to end its service when the bill, titled "Rendición de Cuentas," was first tabled in July — claiming that the proposed changes "lack clarity" and “an additional mandatory payment for music services”.

In a letter sent to Uruguay's Minister of Education Pablo Da Silveira, a spokesperson for Spotify said: "If the proposed reform became law in its current form, Spotify's business in Uruguay could become unfeasible, to the detriment of Uruguayan music and its fans," claiming that the amendment would force it to "pay twice" the amount of royalties. 

In its statement confirming the end to its services in Uruguay yesterday, Spotify said: “Without clarity on the changes to music copyright laws included in the 2023 Rendición de Cuentas law – confirming that any additional costs are the responsibility of rights holders – Spotify will unfortunately begin to phase out its service in Uruguay effective January 1, 2024, and fully cease service by February."

“Spotify already pays nearly 70% of every dollar it generates from music to the record labels and publishers that own the rights for music, and represent and pay artists and songwriters," it continues.

“Any additional payments would make our business untenable. We are proud to be their largest revenue driver, having contributed more than $40B to date. And because of streaming, the music industry in Uruguay has grown 20% in 2022 alone." 

Speaking to El Observador last month, SUDEI spokesperson Gabriela Pintos insisted that the organisation "was not against platforms" but instead wants royalties "to be distributed fairly."

https://mixmag.net/read/spotify-end-service-uruguay-copyright-law-change-artists-fair-pay-amendment-news

 

[River 106,355]

They will come back when more countries will follow.

Streaming is a hot topic right now and all the credits and royalties issues should be address with the law.

[RodeckDanny 2,237]

Spotify are EVIL!
and big applause to Uruguay

[Red 95,081]

Good, another step at Apple's worl... I mean, streaming domination

[Natalia Kills 377]

I’m approaching this with a huge pinch of salt.

Sure, artists may get a sweeter deal, but the only realistic solution is raising prices for consumers or cutting staff (which has already been done).

By default, consumers don’t want to spend more money on music otherwise they’d purchasing copies of music they like. I don’t think the average consumer wants to have their subscription prices go up.

It’s sort of a given for artists and record labels that money can no longer be made from creating music alone. It’s the trade off these platforms give in promoting artist visibility. Even Spotify is barely just getting a profit and that’s mostly down to cuts.

So even if Spotify came back with a better deal, it wouldn’t be enough. It’s touring, meet and greets, advertising, social media sponsorships that drive cash flow etc.