Songs Music boss Matt Pincus has warned that if digital services adopt a ‘two-class’ system for paying large and small publishers, the songwriting industry as a whole will suffer.
He cites the direct deals being offered to publishers by digital music services as a pitfall in waiting.
“Behind the headline rates lies a grave threat to the music publishing business: the possibility that shares of songs controlled by larger companies could earn more for digital uses than shares controlled by smaller companies or by self-published writers,” he wrote in a Billboard op-ed.
“There has never been a two-class system in music publishing. If one develops, it will stifle competition in our industry and the creativity and ingenuity that come with it.”
Pincus notes that Apple’s publisher deal for Apple Music offered a higher rate than the statutory rate for on-demand streaming in the US – 13% compared to 10.5% – but did not include a most favoured nations (MFN) clause to ensure parity across the board.
“I am now being approached by other large DSPs, which lack Apple’s track record, looking for deals with no MFN protection. The likely result? More money to bigger companies, less money to everyone else…”
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