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Spotify offers advances to indie artists who directly license music

They'd get a larger cut in return for skipping the publishers.
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Reuters/Dado Ruvic

Apple might not be the only streaming music giant eager to cut out the middle managers. Billboard sources claimed that Spotify has offered advance fees to indie artists and managers in exchange for licensing some of their songs directly to Spotify. They'd get 50 percent of the per-stream revenue. That's less than the 54 percent under conventional arrangements, but the absence of a publisher would give them dramatically more money. Right now, they typically only receive 20 to 50 percent of the label's share -- they'd get a pay raise even as Spotify took a larger slice of the pie.

The deals wouldn't be exclusive or otherwise hand over important rights. Musicians could still license their tracks to Apple or other platforms, and they'd still own their recordings. They'd just have to negotiate separate deals with other services. Spotify couldn't do this with major artists as it would represent direct competition with big labels and violate their licensing agreements.

Spotify didn't have a comment on the report. However, this would potentially save the service some cash even as it offered indies yet another incentive to sign up. It could simultaneously increase the chances that Spotify strikes gold. If an up-and-coming indie proved to be successful, Spotify would both reap extra rewards and give that artist a financial reason to stick around.

Source: Billboard
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