CMU Digest

CMU Digest 08.03.21: Tidal, SoundCloud, COVID-19, Apple, Viagogo

By | Published on Sunday 7 March 2021


The key stories from the last week in the music business…

Jack Dorsey’s Square company bought a “significant majority” stake in the Tidal business for $297 million. Dorsey, best known as CEO of Twitter, said that Tidal and Square would now work together on “finding new ways for artists to support their work”. Some industry observers noted that one way for Dorsey to help artists support their work would be for Twitter to start paying for the music that streams on its platform rather than relying on the copyright safe harbour to avoid liability. As part of the deal Jay-Z – who bought Tidal back in 2015, of course – will join Square’s board. [READ MORE]

SoundCloud announced it would shift to a user-centric royalty distribution system for the 100,000 independent creators on its platform. It means that subscription and advertising monies due when those creators’ content is streamed will be distributed on a user-centric basis, rather than using the current service-centric system. However, monies due to labels, distributors, publishers and collecting societies whose music is on the platform will continue to be distributed under the conventional model. There have been increased calls of late, of course, for a user-centric approach to royalty distribution to be applied to all the streaming services. [READ MORE]

The music industry welcomed the news that various COVID support schemes in the UK were to be extended, but said a government-backed insurance scheme for major events was still urgently needed. With COVID restrictions in the UK set to be in place until at least June, various support schemes previously due to end in April have now been extended, many through to September. That includes the furlough and self-employed support schemes, and VAT and business rates relief. There will also be additional specific funding for the cultural industries. However, the industry argues that for festivals and other large scale events to return this summer they need government-backed cancellation insurance, and that was not part of the new package of COVID support announced by Chancellor Of The Exchequer Rishi Sunak this week. Concerns also remain about the number of freelancers not actually eligible for the self-employed support scheme. [READ MORE]

The UK competition regulator launched an investigation into Apple’s App Store rules, amid reports that the European Commission could send a statement of objections to the tech giant over its allegedly anti-competitive conduct. That statement of objections stems from the formal complaint Spotify made against Apple in 2019. Like other major app-makers, Spotify objects to App Store rules which mean that it has to use Apple’s commission-charging payment platform if it sells subscriptions through its iOS app, and it can’t direct users to alternative payment options elsewhere on the internet. Sources told Reuters and Bloomberg that the EC’s response to Spotify’s complaint should be issued this side of the summer. [READ MORE]

Viagogo was given permission to hold off paying a AUS$7 million fine pending its appeal of legal action pursued against it by the Australian Competition And Consumer Commission. Based on the ACCC action, in 2019 a court ruled that the often controversial secondary ticketing website had made false or misleading representations and “engaged in conduct liable to mislead the public”. Last year it was ordered to pay the AUS$7 million fine in relation to those violations. However, Viagogo is appealing the original court ruling and asked for permission to postpone paying the fine until that appeal has gone through the motions. It cited the challenges posed to the entire ticketing sector by COVID and said that paying the fine now would result in further job losses at the ticket resale company. Based on those arguments, the court approved the postponement. [READ MORE]

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